Post by
SuneeDaze on Aug 21, 2019 10:15pm
Float Power and Market Cap
So often exploration investors simply react to drill results, and may consider price without the share count and market cap.
Below is approximate share count, sp and market cap. of the main Dixie plays.
PAC: 177 million x. 0.17. = $30 million
BTU: 66 million. X. 0.095. = $6.3 million **$ 7.6 million
RGLD: 25 million x 0.195. = $ 4.9 million
I suspect BTU's share count is around 80 million and market cap are closer to $8 million because there are a number of warrants and options that were in the money when the sp ran to the 20s.
Right off the bat, PAC has a market cap several times that of BTU and RGLD. I'm really not unsure why which means there's huge downside. Also each penny rise in sp raises the market cap almost $2 million, so from this point, it would take crazy good results to move it any amount. Anyone investing at these levels would probably hope for what? Let's say a modest 30 % increase. Well a 30% increase would mean the market cap would then go to $40 million!
BTU's market cap is about 55% more than RGLD...but they are drilling. Fair enough. The concern there is the sp at this point of drilling. If results aren't strong, it's obviously going down a few cents (from 0.09). This makes the next round of financing very dilutive for them if they don't come up big.
Which leads us to RGLD. We've highlighted all the geological/strategic reasons previously (see below). Given the property's prime location and prospects, it's clearly undervalued relative to the other two...so there's considerable room for price appreciation. There's also various scenarios that this will happen (see previous posts). Any financing at 0.20-0.30 will involve minimal dilution (e.g 2-3 million shares) and still have a float under 30 million...still less than 1/2 of BTU. Also, because of the low float, an equivalent rise in market cap to the other two would involve a greater sp rise.
As I've said previously, RGLD has potentially the most prospective property, the cheapest market cap with the lowest float, oh, and a CEO who is consistently buying stock on the open market with his own personal funds (almost 30%). What's not to like?
Comment by
TruthBKnown on Aug 22, 2019 1:26pm
Interesting comments on CEO.ca by someone who said that RGLD valuation is basically that of a shell company. That the potential value of their Dixie and Moosehead projects isn't even factored into the market cap. People are slowing waking up to this story. As more start to discover this little gem it's going to get interesting then!