Pre PEA comparativesThanks Ekim for the detailed NPV2 calculation, great and very useful. I thought it would be interesting to do some back of napkin calcs for market capitalization based on some publically available information from 2013, 2014 years on pre PEA resource companies. Lot's of factors involved but want to get just ball park estimate of current market value pre PEA and compare to current PGD market cap and share value.
I'm using Ekim's analysis of NPV2 of $1.5 billion and Kaiser's in-situ value of $5 billion (would be similar to Ekim's as well). Back of napkin formula's come from a variety of google searches, I just wrote them down if they were recent and somewhat relavent to PGD (i.e remoteness, stage of company, Canadian assets). Very ballpark!
Assumptions and Intangibles
- Chidliak only!
- Doesn't include an valuation on other company assets (data base, other properties, etc.), mostly held in Peregrine Exploration
- Assume net debt is zero (??) or not material, PGD outstanding shares at 300 million
- Shares tightly held
- Freidlands' and BOD's reputation, experience and networks/contacts
- Hopefully conservative (ie, no fancy's, conservative diamond prices, large stones, favourable exchange rate, etc)
1. Enterprise Value = 0.05% of in-situ value
0.05% of $5 billion = $250 million
2. EV = 10% to 20% of NPV
10% of $1.5 Billion = $150 million
20% of $1.5 Billion = $300 million
3. EV (NPV)/4 = Market Cap
$1.5 Billion/4 = $375 million
The above equates to a share value between:
$0.5/share to $1.25/share pre PEA
From Kaiser Jan 26, 2015
"the potential for five to tenfold gains from the current level ($0.14), Peregrine Diamonds will develop a gradual uptrend that should persist until Q4 of 2015 when we will want to see results that confirm our grade, tonnage and carat value expectations.
$0.7/share to $1.40/share