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FRG hits new high $9.90 but Motley Fool warns...
Fronteer Development (AMEX: FRG) is another one of these head-scratchers. It's another revenue-free wonder, this time trading at a market cap of more than $600 million. What's it got? "Interests" in mineral properties in Canada, Turkey, and Mexico. I'll let the company tell the rest of the tale:
The Company is an exploration stage company and there is no assurance that a commercially viable mineral deposit exists on any of its properties. Further evaluation will be required on each property before a final evaluation as to the economics and legal feasibility of the property is determined.
On other words, investors are paying $600-odd million for plans and high hopes. Can management pull it off?
As above, I've got my doubts.
Fronteer's CEO is also director of Frontera Copper, a company founded in 2002 that has yet to put any revenue on the books. The CFO's resume includes Emgold Mining, a Canadian penny-stock company that has not recorded any revenue ever, according to my records, which go back to 1995.
Histories like these make me very skeptical, and I suggest you give them a wary look as well.
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