The Motley Fool

Why the AVZ share price is at another 52-week low

The AVZ Minerals Ltd (ASX: AVZ) share price hit a 52-week low of 3.7 cents today and is now down around 80% over the past year as the company’s cashflows start to disappoint its shareholders.

AVZ Minerals sold speculators a story about the potential of its Manono lithium project in the Congo, although it is still miles off the production stage and burning through shareholder cash.

In fact for the quarter ending December 31 2018 AVZ posted no revenue and an operating cash loss of $5.63 million to leave it with cash on hand of just $931,000.

Unsurprisingly, it has since sought to raise up to $5 million in capital from retail share owners, although even that amount is not going to go far given it spent more just over the last quarter.

It’s no surprise then that the share price is languishing at 3.7 cents as other capital sources such as bank debt are not a realistic option for mining companies at the costly exploration stage with no revenue let alone profit.

It boasts that it controls the ASX’s “largest lithium resource” but it seems even the speculative end of the market has woken up to the cash flow problems now.

JUST RELEASED: Our Top 3 Dividend Bets for 2019

NEW! The Motley Fool’s team of crack analysts has just released a timely report revealing the names and codes of their top 3 dividend share recommendations for 2019. Be among the first investors to get access—FREE, for a strictly limited time. You’ll discover the names of 3 hefty dividend paying companies with what our analysts consider to be solid growth prospects for the year ahead…

The first two currently offer fat, fully franked yields and the third is a surprising REIT offering you the chance to become a landlord with none of the hassle! If you’re looking for hot new ideas, look no further. But you do need to hurry. Snap up your free copy now, before supplies run out!

Simply click here to grab your FREE copy of this up-to-the-minute research report on our top 3 dividend share recommendations right away.

Motley Fool contributor Tom Richardson has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

NEW. Five Cheap and Good Stocks to Buy in 2019…

Our Motley Fool experts have just released a brand new FREE report, detailing 5 dirt cheap shares that you can buy today.

One stock is an Australian internet darling with a rock solid reputation and an exciting new business line that promises years (or even decades) of growth… while trading at an ultra-low price…

Another is a diversified conglomerate trading near a 52-week low all while offering a 2.8% fully franked yield…

Plus 3 more cheap bets that could position you to profit over the next 12 months!

See for yourself now. Simply click the link below to scoop up your FREE copy and discover all 5 shares. But you will want to hurry – this free report is available for a brief time only.

CLICK HERE FOR YOUR FREE REPORT!