NCU will be on top (appreciation wise) Okay back to the top of the thread now from a Gnu buyer:
NCU's share price in particular will have a multiplier effect beyond that of other copper stocks and this is why: Subsequent to the last financing (equivalent of $.14 net of warrants) we now have:
- Election uncertainty resolved in favour of the copper demand guy and copper now at $3.42
- A brand new mill tested and running fantastic at it designed specification of 5000 tons per day
- Copper is being sold and full production will be achieved in the next 8 to 16 weeks
- Hoisting and ventilation shafts will soon be completed to full design spec.
- NCU is only hedged ~ 25% over next 12 months
- Covid uncertainty is abating because favourable vaccine news keeps coming out
- Since the July re-financing ($.14 net of warrants) copper is now at least 50% higher in terms of marginal profit (based on the all in costs of $1.86 per pound.) Shares were $.14 to $.24 when the copper margin was about $1.00 and now the shares are $.12 while the margin is about $1.5
- Tax loss selling may have stopped...this is a big unknown though
- A share consolidation may take place and I for one am in favour so margin can be had and institutions can buy again
- Flippers may periodically dump into the bid
- Shorts have probably covered… not sure
- New debt financing is now done to access the larger hi grade stopes
- Dilution worry is gone because banks are willing to lend at reasonable rates (interbank rate + 4.9%) This means the fear of a punitive mezzanine financing is now GONE
- A recent, highly experienced CEO has come on board and because he was granted a package of 3,500,000 share rights that give him value over time as the share price increases, his interests are now aligned with all the smaller shareholders.
- Also, a lot of capital will come in when the $.20 warrants are cashed and this will allow funding of resource additions by way of much more expansion drilling.
I see a $.45 to $.60 price within 6 months = 4 to 6 bagger
Despite what some posters here claim here I am not a day trader and have not sold a single share. I will be on the bid for more and will only sell if I do not like the macro outlook anymore.
A note on share appreciation math: When a commodity price goes up for unhedged sellers it is the high cost producer that benfits more on a percentage basis - Company A produces copper at $0.00 per pound (maybe due to gold credits)
- Company B produces copper at $2.00 per pound
They are both stead state and priced according to earnings etc with copper at $2.90 Copper quickly moves from $2.90 to $3.50 - Profit at Company A goes up about 15% or so
- Profit at company B goes up about 75% or so (not exact but you get it)
Plus Company B was trading at 35% of NAV due to bankruptcy risk which is now gone. Company A was never at risk so it trades at 2X NAV Company B benefits many times more than company A from a jump in the outlook and price for copper NCU - my holding now, CMMC, TKO etc all benefit most. IVN, HBM, RIO etc benefit least Cheers,
Notgnu
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