East Asia Minerals Corporation (CVE:EAS) Facing the Drop-out

East Asia Minerals Corporation (CVE:EAS) pause in the recent uptrend continued yesterday, the company currently traded under $10, loosing further value and investor interest. Without the weekly press release, trading volumes decline, confirming the weakening of the trend and implying expected reversal in investor mood about the stock.

A number of press releases have pumped the around three months lasting uptrend for East Asia Minerals Canadian stock and have caused several jumps in the market value of the company. The latest one, dating back to last Thursday, informed the market about some significant progress on the Miwah Gold Project in Indonesia, whereby new gold-bearing have been encountered.

The week before that, East Asia Minerals also reported additional $18.85 in funding over a private placement of 2.5 million shares, which however will not immediately dilute current shareholders, as the shares are subject to a lock-up agreement expiring in September. Proceeds will be used to continue working on the Indonesian Gold Projects, though what the results will be, if any at all, remains undefined.

East Asia Minerals is working on 6 Indonesian and 14 Mongolia mineral projects, but as the interests on many of the properties were acquired 2006 and since then no results have been reported and even no economically recoverable ore reserves have been confirmed yet in any of the properties.

Also, the apparently strong financial position with $25.7 million in assets and no debt financing does not seem so flourishing on the second glance. Assets consist of $6.2 in cash and $18.8 in mineral properties. Though, the $18.8 million represent actually the costs, associated with the exploration and drilling of the mineral properties. Those expenses have been considered a long-term investment and appear thus on the assets side of the company.

Further, no revenues were realized, and losses have more than doubled from $1.6 to $3.4 in the six months ended February this year. All facts, implying the market is at the moment willing to pay exorbitant premium on some vague potential.

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