RE: COP SIR comparisonThing&concept
It's very difficult to try and figure out the valuation of a junior mining company. Most of them don't have a real operating mine so you can't get an accountant to crunch the numbers using the resources in the ground and the price of the resources and then subtract the expenses like debt, operating cost what ever and come up with a valuation. Most juniors are looking for resources so now it's kind of like magic to come up with a valuation. Most juniors are based on what they have found so far and what they have coming down the pipe and of course the price of what ever they are exploring for. In the old day those Toronto mining promoters could pump the crap out of a company even though they had nothing. Now a days promoting does pump up the shares but not like in the old days since the internet give the average investor a tool to try and weed out the pump and dumpers. In COP case they have a 43-101 which is the industry standard in determining the resources in the ground. The next step is to get a permit and then get some money to make it happen. Depending on where they are in this process will determine the valuation. In theory the farther down the road they get to a mine then the valuation should approach the accountants valuation using the resources in the ground, debt, expenses etc. Any bump in the road would cause the shares to fall. No permit would be a major fall. On the bright side if the junior has other things on the go then this could offset any bumps in the road.
Here's a really good example -> NOT.v .Those number seem extremely high to me but for lots of people they seem fair. Bottom line is that valuating a junior is very hard and they are high risk but no big risk, no big reward.
MM