Stockhouse Ticker Trax pick Geomega Resources (TSX:V.GMA, Stock Forum) has had its wings clipped after an impressive run by virtue of a private placement offering.
Shares in the company dropped from $0.71 down to $0.61 after it was announced that a $3 million offering would be made at $0.60.
Geomega had been trading at $0.10 at the start of 2014, but jumped significantly as Ticker Trax columnist Danny Deadlock began talking about the potential of the company. It peaked at $1.06 before settling over the last few weeks at a $0.65-$0.70 range.
The company successfully concluded tests this week confirming the physical separation of neighbour rare earth elements (“REE”) based on free flow electrophoresis technology. Testing proved that 100% purity separation of HREE is possible in a single pass, 100% purity separation of medium to LREE is possible in two passes, and 100% purity separation of LREE is possible in a continuous loop in the current process condition.
Deadlock had pegged the demonstration of the physical separation technology as being a big catalyst for the firm going forward, saying this technology “has explosive Biotech style potential” that, if commercialized, “has the potential to dramatically lower capital and operating costs for the rare earth industry plus significantly reduce the environmental footprint.”
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