Minerco Resources Inc (OTCMKTS:MINE) witnessed sharp decline in its share price in the past few weeks. MINE stock price dropped over 13% earlier in the week. The decline on Monday was then followed by gains of 7% at share volume of 21.55 million. As a matter of fact, the share prices have remained quite subdued from past one week.
The press release
In the last issued press release, Minerco highlighted that its wholly owned subsidiary increased its stake in Avanzar Sales and Distribution, LLC. It bought additional 21% stake and with it, the total stake in Avanzar increased to 51%. Scott Vanis, the Chief Executive said that increasing the stake in Avanzar Sales and Distribution is a part of the company’s strategic plans. The prime objective of the company is to increase investor value by investing more in cash flowing assets.
The last press release didn’t result in any excitement amongst the shareholders. There is a major reason why after the positive news the investors opted for a silent reaction. There is a hidden disadvantage in the deal. As per the deal, Minerco will make structured payment of amount $400,000 in 2015 to complete the acquisition process. It is evident from the decision that the total liabilities are going to increase in FY2015. The hidden disadvantage prevented the shareholders from getting excited about the news. The company would have to take several initiatives to fetch attention of people.
The other details
Minerco Resources Inc (OTCMKTS:MINE) cannot instill any confidence in shareholders after it released its 2Q results. It even announced that it plans to list on a reputed exchange. Vanis addressed the shareholders and said that the company recorded strong growth in last quarter. The revenue surged to $740,000 in 2Q from $502,000 in 1Q2015. It indicates a massive jump of 47% QOQ.