I have been critical I have been critical of this company and its bone headed management. However, I must say that the stock is starting to look somewhat attractive with zinc all the way up to $1.08. The company is NOT profitable at $1.08, but it should at least be cash flow positive. That could really alleviate any pressure to file for bankruptcy.
The stock remains a pure gamble. No one knows what kind of deal might be made to recapitalize, and no one knows what will happen with treatment costs.
However, with zinc at $1.08, I think the stock might actually be a decent gamble with a favorable risk/reward simply because the company has a better chance of surviving now.
Here is my best guess at odds right now for the next couple of quarters:
1. Worst case - bad recapitalization deal, treatment costs remain high, zinc drops back below $1 - Stock drops back to $.06 or possibly much lower (say $.03) - 25% chance
2. Middle case - enough relief on capital to survive, slight drop in treatment cost, zinc stays between $1 and $1.10 - Stock limps along near its current price with ups and downs - 40% chance
3. Best case - good recapitalization deal, decent reduction in treatment costs, zinc rallies to the $1.10 to $1.20 range - Stock price could easily triple to $.35 - 35% chance
Total odds weighted stock price:
$.03 x 25% + $.11 x 40% + $.35 x 35% = $.17