China Energy Corp. (OTC:CHGY): Disappointing Attempts to Push Up

The promotion however failed to impress the market, since much more impressive jumps of China Energy have been seen recently. Only the effect on the trading volume was significant, but not so great as expected, as the number of shares traded couldn’t even double.

The stock has proven as a real climbing talent over the last two months. A bounce up by almost 75% at once followed the filing of the financial results for the last year at the beginning of March and since then China Energy piled up over 450% increase in value. With a promisingly higher volatility at the same time, the stock continues to be a good pick for stock gamblers. Not regarding the book value of only $0.74 per share, the market seems to be convinced of the high-growth potential of China Energy and considers the stock highly undervalued.

China Energy Corporation operates mainly in the People’s Republic of China through a subsidiary and is a producer and supplier of raw coal for domestic heating, electrical generation and steel production. Further the company acts as an intermediary in the processing of coal trade transactions. The company is not exactly the typical promoters’ client as the high expectations of the investors seem to be justified by facts. The financial results show remarkable improvements in revenues and earnings.

Was the promotion then an attempt to create a bubble and overestimate China Energy’s potential? A quick glance at the reports shows that not everything is so wonderful and the company’s profitability has actually declined considerably. Hopefully there are good reasons for that, along with the mine expansions and the restructuring program.

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