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Alio Gold Inc. T.ALO

"Alio Gold Inc is a gold mining company. It is engaged in exploration, development and production in Mexico. Its projects include San Francisco mine in Sonora, Mexico and the development stage Ana Paula project in Guerrero, Mexico."


TSX:ALO - Post by User

Comment by MisterBon Jun 29, 2017 4:26pm
252 Views
Post# 26421447

RE:A few thoughts.

RE:A few thoughts.
FB, I take a bit more cynical and negative view here.
The Good:
-Reduces uncertainty and brings cash on hand to $90M
-Buying opportunity

The Bad:
-The timing is abhorrent. Terrible. Stupid. Aggressive. Unacceptable.
-The dilution to current shareholders is greater as a result of this agressive approach. Why so agressive on timeline? Why not closer to AP FS release or after two more quarters of results? 
-Blatent disregard for current shareholders. RS by 10 (5 would have done) then dilute by 22%.
-As with the .55c PP, Co has now raised 60M via share issuance. Stupid. Wrong. Unnecessary from a timing and total $$ perspective.
-It will take a month or three to get back to where we were.  See last PP charge and the bottom we had to carve out to start moving up again (although I fully concede we are at a much different place with regard to company maturity)
-Reduces EPS
-Reduces target prices
-Reduces possible takeout price (20% dilution will do that) 

The Ugly:
-Down 20%. More to come imo.
-Short term impact is significant.  Longer term it is muted.

Overall, McCunn is overly aggressive.  Lacks patience, but is dead set on AP success and will push it forward, but I feel some very important events are ill-timed and should have been planned better.  The end game and relative end game price doesn't really change much, so I stayed pat. Since I decided not to sell at $6.15, I will have to "eat it" until FY18 despite my total disagreement with his atrocious timing.

B
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