This is why we moved up todayThe numbers are undeniable AND conservative AND verifiable:
Should AUR's average selling price for copper in 2006 be $2.50, $3, or $5 (it sells its copper for almost a dime over spot prices because of its LME Grade A premium) and applying the formula presented in the Conf Call that each 5 cents over $2/pound will add AT LEAST (based only on 1 quarter from Duck Pond and getting nothing from Louvincourt scrap heap -- anything more goes directly to earnings) 8.5 cents/share to earnings of $1.79, we get the following:
Average: Earnings: Cashflow: NET Cash:
$2.50 $2.64/share $4+/share $5.50+/share
$3.00 $3.49/share $5+/share $6+/share
$5.00 $6.89/share $8+/share $9+/share
That formula is directly from the Conf Call. Imagine a 2007 at these prices with a full year from zero-cost 100% owned Duck Pond and you can add at least $1.25 directly to 2006 earnings. Now imagine a 2009 at these prices with AUR producing about 400 million pounds at under 50 cents/pound or lower (produces 60,000oz of gold as by-product)with Andacollo expansion. This stock would be considered undervalued today by me if it was $30/share as it would be trading at about 6 times cashflow and less than that if you subtract the NET cash. AUR's story has yet to get out. Watch for a pop from Chilean Stock Exchange listing any day now and Andacollo Final Feasibility Study, to say nothing of La Verde news of further consolidation in the sector (AUR with 400 million pounds at less than 50 cents by 2009/10 and NET CASH by year end around $6/share is the number one target out there).