Question and a reprintBoard, how do you take someone off of IGNORE? Thanks.
AND
Worth another read until it sinks in to enough skulls.
If you answer YES to the following statements:
1. Spot copper will average at least $2.50/pound in 2006;
2. Spot copper will average at least $2/pound in 2007; and
3. Spot copper will average at least $2/pound in 2009/10
THEN YOU ARE OBLIGED BY ALL THINGS SANE AND PURE to find all the spare cash you can and buy shares of AUR at these prices.
WHY?
1. Should AUR's selling price average ONLY $2.50/pound in 2006 (note that spot is over $3 and AUR sells their copper for about 8 cents more than that because it is LME Registered as Grade A) AUR will have earnings of AT LEAST $2.64/share as each 5 cents over $2/pound will add 8.5 cents/share to earnings of $1.79 (from Conf Call and very conservative) and cashflow near $5/share as well as NET CASH over $5/share;
2. A full-year of 100% owned less than zero cents/pound Duck Pond will add at least $1.25/share to 2006 earnings in 2007 (if fully operational this year and at ONLY $2.50/copper earnings would be around $4/share);
3. With Duck Pond and Andacollo expansion set to nearly double production by about 2009 to around 400 million pounds at about 50 cents/pound (or lower as a by-product will be 60,000oz of gold/year for 20+ years and highest cost 30% owned Louvincourt mine closed), a $2.00/pound copper price would see earnings near $10/share with higher multiples and a huge NET CASH position as all this expansion will have been done without dilution or debt because of the current NET CASH position on track right now to finish the year around $6/share!!!! (think about that).
Those are the numbers and they can be confirmed from the Conf Call and elsewhere. If you are a copper bull like myself than surely you feel no hesitation in buying a stock trading for TRAILING cashflow/share price multiple of about 5!! and a forward multiple of about 3!! (or less if you subtract the NET CASH). If AUR was trading at $25/share right now it would still be undervalued as it would be trading for a forward cashflow/share price multiple of around 5 and a forward PE of around 8 (and less on both counts if you subtract its HUUUGE NET CASH position).
That's the summary in a nutshell. Pass it on and spread the wealth because when AUR moves it will move harder and faster than you can imagine as a case can easily be made for a $20, $25, $30 or $35/share stock price RIGHT NOW with the information that we have on hand.