RE: RE: Gold Sell Off My biggest fear is the proposal of a reverse stock split, something like 4 :1. I'm not sure shareholders would approve this, but it might be the only way to attract new money. Let's say this happens at 5 cents, it would bring the share price up to $0.20 and shares outstanding down to 57 Million. The problem with this of course is the downside potential. With current market conditions, SP could easily tumble back down to 5 cents leaving us a Market Cap of only 2.3 Mil. Can't really see this happening given the amount of gold in the ground, but with gold prices this low, something to factor in for sure.
The big question that GBB will be faced with is at what price per ounce are they going to be profitable? We all know that when gold was climbing, gold producing companies were NOT seeing the same climbs in their share price. However, the costs to produce that gold were rising. Now that gold is in a free fall that discrepany represents a real concern. I mean look at Barrick, yes gold has dropped to prices we havent seen since the beginning of 2011 but does that really warrent losing a DECADE of gains??? Well, it happened. But back to my question, at what price per ounce will GBB be profitable at Granada? When crunching these numbers management better be accurate. I believe most of the majors are profitable at around $1100 oer ounce. It's tough for a junior to hit that number and with gold at its current price and posied to drop further, that leaves no room for error or unforseen setbacks. What to do???
What are some other thoughts on this?