Post by
AsISeeIt9 on Jul 22, 2023 2:11am
Hmmm.....
Heliostar announces a $ 12.5 million PP in Jan and closes at $ 20 million (@ $ 0.22). Then they announce a $ 7 million placement at $ 0.37 in June and close it in two days. Wow. Shows real strength. Except the stock tanks to $ 0.24 soon afterwards......
Then on top of the previous monster holes, they announce 242 m @ 9.06 g/t. Wow!
And after a one day rally to $ 0.35 (less than the PP price), the stock declines to $ 0.30. After a hole that every mining company would die for.
What gives? Here's my two cents worth. I'm not a geologist but a got a little input from one who is.
Let's say you want to measure the width of a two lane road. What would you do? Put a tape measure across the road, right, while ensuring you avoid the cars. Better to use a laser. The point is you would measure across the width of the road.
Would it make any sense to measure the width by placing the tape measure right in the center and then going along the length of the road to measure its width?
That is sort of what they have done here, I think. Ore bodies are 3 dimensional. So you drill to ascertain the grade and the width of an intercept. To do that you drill perpendicular to the strike (how the ore body lies) so you try to get a measure of true width. Then you drill above and below for the 3rd dimension.
If you drill along the strike (the equivalent of measuring the length of the road when you're trying to find the width), you get intercepts like 242 meters. Because it's along strike!
242 m @ 9.06 g/t is a monster hole. So why has the price declined? Because enough people understodd what they did, I suspect, which was highly promotional.
Now the Exchange should slap their wrists for that, it is frowned upon, I believe. I could be wrong about that, but the market clearly reacted very positively initially and then sold off the day after. That's due to more seller than buyers.
There is gold there, they have a 43-101 that says so. The average grade on their 1.4 m ouncesat Ana Paula is 2.16 g/t. So with all these high grade, long intercept holes, the share price should have gone ballistic, right?
They have over 3.5 millon ounces in their three deposits, of which 3.1 million is Measured and Indicated, so at a higher confidence level than Inferred ounces. And a $ 45 million market cap. So $ 15/oz. in the ground.
Now the value of an ounce ofg gold in the ground varies with the bullishness and bearishness in the gold sector. And whether it is open pit (less expensive to mine) or underground. And so on. I don't know if $ 45 million is right but it seems low to me given that the recent drilling is showing much, much better grades and widths (?) than the 43-101 measured.
What I can see is the market is not reacting bullishly to these great results.
Specially at these low share prices. At 30 cents, the stock is trading at near 3 year lows!
Something is not right. Are the 22 cent PP investors dumping. Why, when you have such great results. Don't you want to hang onto your stock and make a lot of money? Is that what junior mining is about 5-10 X?!
They have a good Board, decent team. So what gives?