RE: Anyone strong in math out there.....I cannot resist taking a crack at this. At current market prices SVM has US$400 per ton of silver, US$320 per ton of lead and US$170 per ton of zinc. That is a total of US$890 per ton. They expect to initially mine at a rate of 100,000 tons per year and then increase to 200,000 tons per year in the second year. Assuming an outragously high cost of say US$90 per ton (it will likely be much lower) that leaves US$800 per ton profit of which they get 77.5% or about US$600. So SVM's share of the profit in the first year could be in the range of US$60,000,000 or about Canadian $70,000,000 and with say some dilution to 50 million shares outstanding, that works out to $1.40 Canadian per share before taxes in the first year. Take off taxes and I would think it is about 90 cents per share first year and $1.80 per share second year. The current price is looking kind of very cheap considering silver companies trade at very high multiples to earnings.
I just read a report the states that silver companies trade at a market cap. equal to about 20 to 30 times cashflow, thus if SVM has a cashflow of $70 million first year and $140 million second year, the market cap. could be $1.4 billion to $2.1 billion for first year and $2.8 billion to $4.2 billion second year. With 50 million shares outstanding these would equate to share prices ranging from $28 Cdn. to $42 Cdn. in the first year and $56 Cdn. to $84 Cdn. in the second year. Interesting figures, I think I just talked myself into buying more shares. This is all JMHO and feel free to comment if I have made any errors.