Valuation.Taken from a poster on another board, which makes perfect sense to me:
Got in on this one today. For a debt free, emerging producer may pour first gold at anytime in Q4, this stock is extremely undervalued at current price.
AUQ's net cash flow for their share of 20,000 oz per year at a cash cost of $200 per oz and at a POG of $600 US per oz would be about $5 million cdn.
Note: For heap-leach open pit operation, the cash cost at the begining will be $225-240 as highwayman mentioned above, later it will be down to $177, the target cost of the company. So assume the average cash cost in 2007 calender year will be $200.
At 20 times cash flow, the market cap would be about $100 million, for that level of cash flow. The fair value should be $1.50 per share once production starts.
At 10 times cash flow, the market cap would be $50 million, it should be traded at 75 cents.
Let's give another discount, it should be 50 cents...It's a no-brainer at 28.5 cents.
Next news about pouring first gold will be out at any time soon and the news will drive this stock to 40-50 cents at least.