What’s going on with Riva?
RIR sector growth sank between 2015 and 2016 and struggled throughout 2017.
Back in October Riva traded 16 million shares and gained close to a 60% profit. A trading halt was then called for, and was granted by the ASX. It seems the mining company has been rather busy as of late.
What caused Riva share price to drop?
Riva is sensitive to changes in their business cycle. As a result, their shares can go through some pretty intense shifts. RIR decided to sell their metals for a cheaper price than their competitors.
Housing development was low and those who did build purchased metals from other companies, usually did so from Riva’s competitors. Riva decided to combat the competition by selling their metals for a cheaper price.
Back in June the company’s Cobalt-Gold Project failed to produce any positive results. The outcome disappointed the company, as it had been a vast waste of resources. Their shares have suffered as a result.
However, their net income has slowly risen from 2016’s -$6,873.786 to this year’s -$5,073.706. Being a cheaper option for customers now, Riva shows potential to bounce back next year.
RIR’s earnings don’t exactly reflect its proper value. Its share price drop isn’t useful when it comes to defining how well their business is doing.
What will Riva Resources do next?
The business isn’t exactly struggling. They’re just struggling to adapt to restructure. Cutting corners will affect their stocks either way.
RIR recently entered an agreement to acquire a new cobalt-nickel project at the Tiger Creek prospect, scheduled for 2018.
At the moment, Riva Resources Limited seem to be trying to get themselves out of debt. Their ambitions focus on utilising drilling innovations — an attempt to turn over new profit in a cost free manner.
Junior Analyst, Money Morning
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