LSTG Stock Rebounds
Gold made a nice rebound today, and a further move higher could impact gold penny stocks like Lone Star Gold (LSTG:OB). LSTG is based in Albuequeque, New Mexico and is an exploration stage company that also is attempting to grow via acquisition.
LSTG has properties here in the United States and also in Mexico. The company’s signature property is the La Candelaria project. LSTG owns 70% of the gold and silver project. The property is almost 2000 acres and by some accounts, has massive potential. Some have stated that the potential value of the underlying gold and silver is in the billions.
Shares of LSTG are currently a promo play, and the stock closed up at $1.12, which was a little under a 3% gain on volume of a little over 626K. The activity was better than normal, but no records were set.
LSTG Stock Risky Investment
On a technical basis, LSTG faces strong resistance at the $1.35 level, but has decent short term support around the “psyche level” of $1.
At this point, a wise speculative trader should be keeping his eye on PR’s, volume and the direction the underlying commodities of gold and silver. Also, forget the lofty valuation comparisons to mid cap and large cap gold names. LSTG is just too unproven at this point. The company has a market cap of roughly $129 million and just 12k in cash.
However, as many of you have read in our alerts, there is money to be made in hot penny stocks if you view them solely as trading vehicles.
Now if you are into speculative gold related spec names, add the company to your penny stock list. Just keep in mind that history tells us that Lone Star Gold (LSTG:OB) LSTG is risky and probably won’t be a blue chip stock by next year.
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