Harte Gold Corp. T.HRT

RE:Hrt comments from a stock advisory

[Specific]

Specific wrote: Question:
This mine seems to be in a perilous situation. Bankruptcy is not out of the question I suppose. And now 3 Appian board members have resigned. The senior creditor is BNP and Appian holds "mega millions" of shares. In March, New Gold invested $25 million and still the sp is falling like a rock. What is your 2 cents on Harte Gold

Answer:

Although the company announced fairly positive revenue growth and profitability in its latest two quarters, the company has decreased guidance due to continued operational challenges as well as mitigating measures being taken. This suggests that future cash flow will be negatively impacted, and the company is certainly in a perilous situation with negative cash flows, a negative equity position, and high debt levels. The company has deferred interest for a third time, at a cost of higher interest expenses in the future. We would be very cautious around this name due to a worsening financial picture and reduced guidance which will worsen the financial outlook of the company. It is always a red flag when directors resign. The company is in the middle of a strategic review. These can at times bring better news, or even a takeover, but we certainly would not count on this in this situation. 

 

Hrt has had operational challenges from day 1. Three management teams have not overcome these roadblocks. 

Excessive debt and ongoing dilution have been nasty. 

NG or barrick may be suitors but because of operational challenges you can be assured a purchase would be at a discount. Not a chance they pay a premium for an uncertain project. 

Mr. Market says .075 is the current valuation. 

it may go up or it may go down in the future, that's a coin toss

for me it just doesn't pass the smell test 

gl