Banro Corporation (USA) (NYSEMKT:BAA) Shares Might Be Bottoming Out

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Banro Corporation (USA) (NYSEMKT:BAA) shares ticked 3.75% up on Friday to $0.188 and were flat in after-hours trading. Share prices have been trading in a 52-week range of $0.15 to $0.48 so the stock is currently near support. The company has a market cap of $58.28 million at 303.48 million shares outstanding.

Banro Corporation (USA) is a Canada-based gold mining company. Through its subsidiaries, it holds interest in a number of gold properties, including Twangiza, Namoya, Lugushwa and Kamituga. The company is focused on production from the Twangiza gold mine in the Democratic Republic of the Congo. These properties, totaling approximately 2,000 square kilometers, are covered by a total of over 10 exploitation permits or mining licenses.

Through its DRC subsidiary, Banro Congo Mining SA, Banro Corporation (USA) holds over 10 exploration permits covering an aggregate of over 2,600 square kilometers. Approximately 10 of the exploration permits are located near its Twangiza property and approximately four are located near the Namoya property. The Twangiza property is located in the South Kivu Province of the DRC, and has an area of approximately 1,000 square kilometers. Namoya consists of prospects, including Mwendamboko, Muviringu, Kakula, Namoya Summit, Seketi and Kangurube.

Banro Corporation (USA) recently reported that it achieved record gold production in 2016 at 197,691 oz, buoyed by 50,449 oz of gold mined in Twazinga and Namoya. In particular, Twangiza produced 26,395 oz of gold in the fourth quarter of 2016 and 104,438 oz for the year while Namoya produced 24,054 oz of gold in the fourth quarter of last year and 93,253 oz over the year.

Management noted that production continued its upside momentum throughout the year as Twazinga moved higher amounts of waste material to achieve higher ore deliveries in the future. Aside from that, improvements in mining productivity allowed the operations to maintain consistent stacking rates during the quarter. However, expected increases in stacking rates were not achieved due to restrictions in available ore zones, leading to the average grade stacked being lower than the previous quarter.

A look at the daily chart of Banro Corporation (USA) shares indicates that price already broke out of its downtrend that started in August last year. However, price seems to be having a bit of trouble sustaining its momentum or it could be pulling back for a quick retest of the broken trend line before heading further north.

Commodity prices have been on the rise these days due to improved sentiment in China, as well as the demand for safe-haven precious metals in the midst of global uncertainties. Gold has been able to take advantage of the risk-off flows stemming from the Brexit negotiations set to start sometime in March and from the incoming Trump administration.

In terms of volume, investor interest seems to have subsided recently as buyers probably booked some profits of the recent rally in Banro Corporation (USA) stock. However, if more buyers join the reversal on a pullback, price could stand a chance at breaking past the $0.20 barrier and moving up to the next area of interest at $0.25 to $0.30.

DISCLAIMER: There is a substantial risk of loss with any speculative asset, especially small cap stocks. The opinions expressed are those of the author, and do not constitute recommendations to buy or sell a stock. Do your own research before committing capital.