Can you make sense of Nuinsco? Year to year their their shares continue their pitiful performance, I still hold them, hoping against hope .
Thanks for your good work,
Thanks for the assignment and your encouragement. They are both greatly appreciated. Nuinsco Resources Ltd. (NWI TSX) has been in the mineral exploration business for forty years and holds property in Ontario, Saskatchewan, and Turkey. The company also owns shares of Victory Nickel Inc. (NI TSX), and Chalice Gold Mines Ltd. (CXN TSX). In addition NWI has a 50% interest in a private company CBay Minerals Inc.
The thing that you need to come to grips with concerning this investment is that has been shredding shareholder value since its all time high near $6.25 in September of 1987. After that the last spike was at $1.47 in February of 2007. I think that the best value to come out of an analysis of this stock will be the lessons learned to avoid hanging on to a boat anchor when you are struggling in the water.
In many cases investors get trapped in denial that they made the wrong call and then become frozen when it comes to deciding to take the loss and move on to another investment with the capital they have preserved. Your first loss is usually your best loss! Preservation of capital is the salient lesson to be captured from your investment in NWI.
An examination of the charts will add further depth to your evaluative process.
The three-year chart offers a number of patterns that when observed should put a caution flag on the track. The first is the downtrend that has been in place since late 2011 when the stock traded near $0.12. The form of each candlestick on the chart indicates that there is a limited number of trades that represent the greater portion of volume. When you get fewer players at the table it skews the market.
Other factors that you need to keep in mind is the market capitalization of NWI. With only $4.43 million in market capitalization you have to appreciate that the stock has a higher risk profile. Average daily volume over the last thirty days is reported as 169,274 shares. With a trading price of $0.01 per share you can see that there isn’t a lot of money tied changing hands on a daily basis.
The six-month chart doesn’t offer any substantial evidence that NWI is offering anything other than an opportunity to sell it for a tax loss. Over the last three years the stock provided many opportunities to sell and preserve capital. If you take anything from this analysis be sure to nail capital preservation on the wall so you can review the lesson regularly.
Make it a profitable day and happy capitalism!