RE:RE:HOW COME GCM IS SO LOW ? - Recent News Looks Pretty Good>> The article had a negative spin but it's hard to read anything very bad into the press release. <<
Hard to read anything bad?
Read the article again.
https://business.financialpost.com/news/mining/canadas-gran-colombia-gold-files-700-million-lawsuit-against-colombia-over-marmato-project "Issues in Marmato could add to existing doubts in the company’s future prospects
The court’s decision could set a dangerous precedent, as Segovia, the company’s second key asset, also faces opposition from traditional mining communities.
The path to resuming operations in Marmato now seems unclear
AngloGold Ashanti, also struggling to retain access to 33 million ounces of gold at their La Colosa site.
"
They are saying their key asset Marmato has already ceased operations and when it will restart is unknown. Dangerous precedent, Segovia could also be shut down in the same way.
Segovia their cash cow shutting down the same way is a lot more than bad.
Then linking AngloGold Ashanti real news to their fake news to give their fake news credibility.
All BS trying to link one thing to another.
Most likely fake news manufactured by the Spanish websites, and the Financial Post too lazy to check the facts and intentially trying to sensationalize. BS about Gran Colombia unavailable to comment so they can print whatever sensational smearing they can. GCM has always been quick to respond when i contact them. Same thing happened with the fake strike last year. Spanish website saying GCM was losing $3 million per day, as if that were actually possible.
Financial Post saw it on the internet so they thought it must be true lol
With readers dumping millions of shares thinking Marmato has already stopped production and Segovia could soon be next, the one cent drop was not all that bad.
Although the gold price has risen a lot without GCM going up. Last year Dec. when GCM dropped to 9c the gold price dropped to $1130. That was a vastly lower gold price than current price of $1287. GCM with current gold price is CRAZY cheap compared to last year. Trading near 52 week low with gold price ramping up. GCM has a lot of catching up to do with the other gold miners.
>> So an obvious conclusion could be that the article has prompted selling. Does that mean a news driven buying opporunity has been created? <<
It should reverse when they find out it was BS, at least in a non-Bizarro world it should reverse. But who knows, GCM seems to live in a Bizarro world in this market. Regardless of what the market thinks, GCM will still be buying back.
>> Does that mean that we'll soon see much larger buybacks of debs pushing up their price & ultimately the SP as well? <<
It should. The cash generated should spill out somewhere. Q3 and Q4 they generated an extra $7m and $8m cash to pay down payables. Q2 they generated an extra $3m (putting cash into the sinking fund in Q2 subtracted from Q2 working capital). Assuming they don't have any more pressing need to pay down payables, the cash generated should spill over into the sinking fund. Unless they increase their working capital even further.
They are required to put excess cash into the sinking fund and that estimated $15m FCF is excess cash. That is an average of almost $4m per Q. If they don't put that in the sinking fund in Q1, it will eventually be put in the remaining Qs of 2017.
I think $15mil FCF estimate for 2017 is conservative given the amount of cash they generated in 2016, and with 2017 production being higher. Plus gold price currently higher than when they made that estimate. If the gold price continues to ramp up, they can buy back the debs much faster and be left with a CRAZY low market cap if the share price doesn't rise. GCM is hugely leveraged to a higher gold price. A "bang head on wall" buy at current level if someone can put aside their fear and look at the bigger picture.
Catalysts could be
Putting a large amount of cash into the sinking fund
Share price above $1 allowing funds to buy. Just one fund can create a large dollar amount of buying.
Getting an analyst for the dumb market that needs to be told what is extremely undervalued.
I don't expect the resource update to be a catalyst because 10k meter drilling isn't a lot and may not add a lot of oz. Unless they do a lot of inferring. That thick high grade at Marmato is significant, but the market is already not reacting to the large 14m oz.
BuenaSuertaAtod wrote: Since April 11 when the FP article & latest PR came out, GCM has been down on high volume. The article had a negative spin but it's hard to read anything very bad into the press release.
So an obvious conclusion could be that the article has prompted selling. Does that mean a news driven buying opporunity has been created?
Also, with $15mil FCF (as estimabed by GCM at lower POG than today's) it's been disappointing to see a mere $450K deployed from sinking funds so far in 2017 (as per the PR).
They've been depolying FCF to other even higher priority items, such as catching up with taxes & AP - but that's supposed to be accomplished now. Does that mean that we'll soom see much larger buybacks of debs pushing up their price & ultimately the SP as well?