Post by
drunk@noon on Feb 08, 2024 10:44am
A merger would be a nightmare. If the CEO doesn't do
something absurd---which he may well do--the stock would be trading at over 50% free cashflow, that's after tax. That's if they do use debt to raise the piddly cap ex reguired to bring phase 2 on. Also of note: productioin will be the 280,000 range by adding nearby satalyte high grade deposits--something not taken into accouint by the fease study. Given the fact this is a no-execution risk free dig quarry operation---the danger here is the CEO butchering shareholder value as he did with the finacing for phase one.
Seems a dullard or two doesn't understand that using your shares as currency for a merger, or aquistion, when those shares will be yeildiong a 50% free cashflow--that's bottom line after tax, with 2000 plus gold price--makes no sense. 50% free cashlow means in one year you would be able to buy back half your stock if it were to remain at these levels. That in turns turns a 50% free cashflow yield into 100% free cashflow yeild. Needless to say the shareprice would increse in value, but it shows what we are dealing with. If would be like holding a bond yeilding 50%. That would add even more intrinic value as free cashflow was invested in buying back shares. But alas this won't happen, as the CEO stands in the way of this company giving the long suffering share holders a 4-5 banger in 18 months time.