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Ortac Resources – Bid Speculation: The papers are always wrong

By Tom Winnifrith | Thursday 6 September 2012

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

The Daily Telegraph reports that shares in AIM listed gold exploration company Ortac Resources (OTC) rose yesterday on the back of bid speculation. Yeah right.

A story pumped to a daft journalist by someone looking to make a turn or just a way to fill up a line on a page. If there was real bid speculation or activity the stock would have risen by a heck of a lot than 0.03p. Oooh, Tom: are you saying that there is insider dealing in London? Er yes. There are always mega share price movements before any bid and I do not think it is a coincidence. Do you? And 0.03p is not a mega movement.

For what it is worth I have checked with the CEO and he is not aware of anything either. That is not to say that Ortac is not dirt cheap at 0.58p - valuing it at £13.3 million. Remove its cash and its proven resource is valued at just a few dollars per ounce. I shall be having lunch with the CEO fairly soon and will report back with further thoughts. I would not deter buying on fundamentals but on the back of the Daily Telegraph market report? Er... that is another matter.

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