By John Waters, Publisher
Aurcana Corporation, parent company of the Shafter Silver Mine in Presidio, has lost the faith of its investors.
The stock of Aurcana, traded in Vancouver, British Columbia, lost 26% in value May 21, and traded at a low not seen since July 2010.
In heavy trading, over 1.1 million shares changed hands May 21, about five times the usual volume.
The stock, near the end of trading was at C$2.06. Aurcana had traded as high as C$10.08 in 2012. The stock has lost nearly 80 percent in value since 2012.
In early trading on May 22, the stock recovered slightly and was trading at C$2.14
Several factors have led to the stock decline: silver prices are currently near two-year low; recently, the company restated financial reports as requested by the British Columbia Securities Commission; and the stock has been downgraded by Canadian investment firms.
Stonecap Securities downgraded the stock from “outperform” to “sector perform.”
Reuters has reported, RBC cited, the “continued slow ramp-up of Shafter silver price weakness and balance health weakness” as reasons for downgrading Aurcana stock.
The Toronto Globe and Mail reported, “RBC Dominion Securities analyst Dan Rollins downgraded junior miner Aurcana Corporation to ‘underperform’ because of its ‘tight balance sheet’ and the falling silver price. ‘We are cautious regarding Aurcana’s ability to meet its capital commitments and obligations through internally generated cash flow,’ he said.
Aurcana, which once had a market capitalization of C$550 million now is worth C$120 million. Currently one Canadian Dollar is worth about .974 in U.S. Dollars.
According to a recent statement by Aurcana CEO Lenic Rodriguez there are 153 employees and an additional 20 contractors at the Shafter Mine.
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