RTR is a frustrating stock.
The company seems to have all the potential in the world, with assets of tremendous scale - Earaheedy leading the way; and excellent management.
I have no doubt that Earaheedy is a Tier 1 asset in the making, with its potential size almost too big to comprehend and its worth alone more than justifying the company’s MC/EV. However, the bottom line is that RTR has only gone down in price and frustrated shareholders since May ’21, notwithstanding its exploration success.
The fact is that most shareholders don’t have patience to watch a big story unfold, especially when every day another stock is going on a big run. Similarly, Earaheedy is a Zn/Pb deposit (at least at this stage) and these metals aren’t particularly sexy from a market perspective.
I hold a nice sized parcel (at least by my standards) at around current levels and had a friend ring me today telling me they’d taken a loss on their holding at 44c, having been “frustrated” out of the stock.
I told him I respect his decision but believe he may have sold at exactly the wrong time. My reasoning being that I believe yesterday’s report was a game changer in terms of the company’s understanding of the geology of Earaheedy. If their theory is correct, and this could be confirmed by the imminent assay results for holes EHRC129, EHRC361, EHRC408 and EHRC420, we could see RTR back at the old highs.
However, it is RTR’s chart that is telling me that we’re getting to make or break time for the share price.
The stock gapped up, reached a high of 47c yet closed almost on its low for the day at 43c. Volume was the highest since early July ’21.
Now I’m no charting guru, yet it seems as though RTR is currently looking to break downtrend that has been in place for almost 9 months.
Today’s close at 45c left us smack on the trend line. A break and hold above could confirm that RTR is about to start a new life.
It will take news to push the price through the 57c level which is the upper band of the channel that has been building since June ’21, although the first step will need a be a break and hold of the downtrend which seems to be occurring or about to occur. Who knows, it’s possible we go and fill the gap from yesterday at 37.5c – anything is possible.
In short, I think RTR is about ready to start its new life and receive a share price rerating, supported by a backlog of numerous drilling results. Fundamentally, the stock seems very cheap, now let’s hope the technicals confirm the fundamentals.
