As the popular saying goes “fool me once, shame on you; fool me twice, shame on me,” and for those investors who have bet on Spectrum Acquisition Holdings, Inc. (PINKSHEETS: SPAH) in the past only to see their entire investment wiped out the latest activity surrounding the new technologies engineering business focused on the development of bio-mining technology may only serve to conjure up bad memories of an ill-advised gamble.
It was just over a month ago that shares of SPAH climbed to a high of 0.83 but a massive sell-off sent those same shares crashing down to a low of 0.015 late last month. Now SPAH, once again the subject of a promotional campaign, has begun to trend upward, hitting a high of 0.04 on Tuesday with trading volume surpassing the 15.6 million mark before noon. The question is, are there actually investors who believe this climb is sustainable?
There are a number of issues that would indicate that the answer to this question is a simple no. For starters SPAH hasn’t issued a press release since January 26, 2012; two days after shares sank to that 0.015 low. Looking at that release, SPAH didn’t mention anything groundbreaking, just a statement saying they plan “to commence micro-drilling and core sample analysis for gold, silver and platinum on its three (3) gold mine property rights in the historic ancient rivers of gold in the Shasta Cascade region near the Oregon and California borders.”
Now it’s hard for an investor to ignore a company that could be developing technologies that open the door to massive potential and this is what SPAH appears to be targeting. Essentially what they are trying to convey to investors is that their bio-mining technology, consisting of Laser Guidance Systems for Diamond Wire Stone Cutting, an Apparatus for Digesting Metal Ore with Bacteria and new Green Mining technologies that represent sustainable green mining innovations, will afford them the opportunity to actually capitalize on mining properties that have been halted due to the negative impact of traditional mining methods.
This belief is clearly stated by company President/CEO A. Dale Henry in the January 26, 2012 press release. Following the announced intent to evaluate “the reopening of three (3) once highly productive gold mines which have not been evaluated or assessed using modern seismic technology or geological engineering analysis since World War II” he comments, “Spectrum is facing the same difficulty every new technology provider in America is, we are behind a rock and hard place, but our rock could turn out to be gold, if our honest estimates are correct. The greatest potential we have is that there has been zero mining in an area of high potential where a 31lb. surface pocket of gold was found on Graham Gulch 100 years ago and has never been revisited with modern high technology equipment.”
Since that press release SPAH has provided no update to their evaluation nor have they mentioned anything further about their January 22, 2012 announcement in which they stated they were ready “to begin ecological tours in the Shasta Cascade region near the Oregon and California borders.” This jump into eco-tourism is in the same area that they operate a commercial gold mine and hold a lease to the mining rights of the property; something they gained through the acquisition of Avalon Perspectives Inc.
Again Henry sounded optimistic about this development, stating “”Gold prices continue to rise around the world as both the consumer and industrial demand for gold increases. By operating as a working commercial mine and a tourist destination, Avalon Perspectives will be able to create a strong revenue base that will facilitate growth and expand its green mining technology in the area as well as its ecological tourist services.”
Creating a strong revenue base isn’t exactly something that SPAH is familiar with given the fact they have yet to generate dollar one from their operations. In fact, through September 30, 2011 SPAH has accumulated net losses in excess of $2.2 million while holding a less than impressive $1,172 in the bank.
Perhaps most troubling for investors are the, as of September 30, 2011, 1 billion common shares authorized and nearly 500 million common shares outstanding as well as the 10 million preferred shares authorized. This played a significant role in that massive loss from December and will almost certainly play a role in losses when more shares are unloaded when prices climb a little higher.