Leagold Mining Corp LMCNF

Why LMC is going down the Hill ?

[vchesar]

Has anybody can provide a reason for the significant price drop for LCM beginnning April this year. It hit a year high at $3.25 in January. It appears to be a very undervalued Gold stock. Could it become a takeover target at this price level? Gold Corp owns 12% and Yamana Gold owns 20.5% of the LMC shares currently. According to Q2 Financial results, it has cash and cash equivalent of $69 million. It's fulll year projected  production for 2018 is 325,000-350,000 ounces of gold at AISC  $940-$975 per ounce. CIBC World Markets 12 month Target Price is $4.25. The recent suspension of work at its RDM operation should not be a major reason as RDM mine's annual productions is less than 10,000 ounces.

[auburn2]

High capex for the underground Los Filos expansion and the CIL plant they think they want. The EV isn't super low either. The only thing that's going to make you good money here is higher gold prices transforming the value of the business.

[auburn2]

I did read they have plants to grow organically to 700,000 ounces, but that's going to take significantly higher gold prices. I believe the company needs to $1450 gold to hum along nicely.

[uggg]

lol, $1450? Where did you get that number? I must admit that would really make it hum but they are profitable with todays prices.

[ernestokg]

Profitable ? According to google finance the PE is 215 ! Is that profitable ???

[uggg]

On their latest quarter [as per statement] earnings is $.05 per share. Google may be looking further back, before the take over & adding in a full year. You have to remember these guys just took over the mine at the end of March & then picked up Brio to do the same. They aren't bozo's, they may be the best in the business at cost optimization. Gold Corp & Yamana retained large

[auburn2]

It's a very high capex business. AISC right now is reported at $950 assuming nothing goes wrong. It's going to be higher given RDM being two months' offline and the care and maintenance associated with that. AISC doesn't include interest paid on the debt, taxes, and they are talking about spending hundreds of millions for a CIL plant that will improve recoveries at Los Filos and

[uggg]

As I understand it AISC does include interest. Also while Rdm is offline they will be hooking up to the power grid which is going to save a bunch of money as well as using the down time to go through the whole system to see what changes would save money. So, there not sitting on their hands during this time. The feasibility for the new underground development is expected in Dec. Obviously the CIL