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The Penny Stock That’s Outpacing Major Competitors


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The Penny Stock That’s Outpacing Major Competitors

Published on Tuesday, October 16th, 2012
By John Whitefoot for Penny Stock Detectives

A strong economy is needed to help bolster the industrial and metals industry. There isn’t much demand in a
weakening economy for iron ore, aluminum, steel, coal, plastics, or certain chemicals.

Unfortunately, a strong economy is not what we have. While the industrial and metals industry has been in
an uptick over the last two months, the 50-day moving average (MA) is still trading below the 200-day MA.

That said, there is one profitable, financially solid penny stock that is significantly outpacing the index.

MFC Industrial Ltd. (NYSE/MIL) is a global commodity supply chain company that sources and delivers
commodities and materials to clients all over the world, with a special expertise in the financing and risk
management aspect of the business. The company also provides logistics, financial, and risk management
services to producers and consumers of commodities.

The penny stock has a market cap of $512.93 million, $365 million in cash, and a book value of $8.98, and
the company pays out an annual dividend of $0.22 per share.

In August, MFC Industrial announced that revenue for the first six months ended June 30 slipped eight
percent year-over-year to $253.8 million. Year-to-date earnings increased 71% to $25.6 million, or $0.41 per

Maintaining a strong history of ongoing profitability, MCF said earnings in the first quarter were up 403% at
$14.6 million, or $0.23 per share.

On September 12, MFC Industrial announced the expansion of its commodities platform with the acquisition
of Compton Petroleum Corporation. Compton is active in the production of natural gas, natural gas liquids,
and, to a lesser degree, crude oil.

Back in January, MFC Industrial partnered with Alberici Group, Inc. to acquire the troubled Pea Ridge Iron
Ore Mine located in Sullivan, Missouri. There were numerous contractual disputes and lawsuits with the
previous owners of the mine, which have now been settled. (Source: MFC Industrial press release, “MFC
Industrial Acquires Distressed Iron Ore Mine,” January 4, 2012.)

                                  Chart courtesy of www.StockCharts.com

Since the beginning of August, MFC Industrial’s share price has been in an uptrend. In the beginning of
September, the penny stock’s 50-day MA crossed the 200-day MA; a bullish cross-over. Recently, the
company’s share price found support near its 50-day MA, which is also hovering around strongly tested
support near $8.00.

In spite of an eight percent drop in revenue over the first six months, earnings for the period were up 71% at
$25.6 million, or $0.41 per share. MFC Industrial continues to be an excellent penny stock with strong
fundamentals and great momentum.

Momentum in the Moving Average Convergence-Divergence line is still in bearish territory, but is picking up
steam. While the penny stock is up over the last few months, the bulls have yet come into the markets.


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