More explosive news will comeSo far we have only metallurgy results and ownership of the process, and stock almost doubled. The stock was extremely undervalued because few people believe in previous PRs that indicated the the metallurgy will work. Numerous posters claimed the drilling results were irrelevant because RGX did not have the metallurgy, even after earlier PRs released last year that indicated the process worked.... Now, it is absolutely clear the process works (and it is revolutionary as it is efficient, one location, high purity, and low cost!).
For the metal value, I always take discount from 79M tons to 60M tons (just to be on the safe side), each ton $600 (it is again very conservative because it is clearly more than $700, and the price of these are going higher, for example, TiO2 is expect to double!), so the metal value is $36B, or about 25 M oz of gold equivalent (at $1400 per oz value). Just assuming crazy low valuation of 1%, that is still $360 market cap, divided by 120M shares (assuming all warrants are exercised within 3 weeks and all options are exercised and more), we get $3 per share. This is discount after discount, and then after two more rounds of discount. Thus, $3 is the minimum, and that means RGX still has at least 200% growth in the next two months.
So, we still have 3 explosive news items that will be coming: 43-101, mini plant, and then scoping study before March 31, 2011, and among them scoping study should be most explosive as it will come up with economic value for the project, and it will be much higher than $360M used here..
Remember earlier the management already indicated IRR of triple digits. Well, let us wait for the scoping study, if the scoping study still indicate very high IRR (say 70%, assuming raising material and labor cost for the plant and thus reduced IRR), the stock should still command a premium, not discount after discount, $3 should be considered too low, probably a multiple of $3.
lso, it looks like RGX shares are being acquired by funds and big investors (look at recent volumes!), this is the accumulation stage. Usually, these investors look for 300% to 1000% growth from the current price as the minimum target.
Conclusion: RGX stock is still extremely cheap, and it will go much higher.