FJG, RE: Worth 1 billion or just 50 millions? FJG, you present some good and fair questions.....
"How does it come that a company that released a PFS for a project worth 1 billion is only trading for a global market price of 50 millions?"
Not that it is a huge difference, but AXI performed a Preliminary Economic Study [PEA] and not a Pre-Feasibility Study [PFS] back in 2009......and yes, it did reflect a NPV of $1.1 billion.
The thing to understand is, there are dozens of PEA's or PFS out there with Net Present Values [NPV] of $1 billion, but not one of them will make it to a mine without the final Definitive Feasibility Study being completed. Therefore, a $1 billion DFS is worth far more than a $1 billion PEA or PFS. And AXI is still on schedule to deliver their DFS by the end of March. I believe this is why you are just now, starting to see an increase in volume on the up-tick [positive rally].
"How does it come that when AXI released that PFS, in the mid of 2009, the stock went up a little bit to just over 25 cents a piece, no more?"
As stated above, a PFS/PEA is only an indication of the possible economics of a potential mine, thus the increase in the 2009 stock price that you mention, but this does not bring Management to a decision of advancing to the construction phase of building a mine........only a FS can achieve this. And the reason for the recent rally/excitement in AXI stock.
"Can anyone explain why the share is stubbornly staying so low ??"
This is indeed the greatest question.......why so low?? I believe two factors have contributed to our low and undervalued stock price throughout the entire year. 1) the great timelines involved in securing the Joint Venture and Financing from our Chinese Partners. This has obviously created panic amongst shareholders and kept potential investors from jumping on board.......at least until this week! 2) We have had a one or two larges shareholders.....trading through the brokerage house of Anonymous......persisently selling stock into low volumes throughout much of the year. At the beginning of last week, this or these sellers seemed to have filled their orders and disappeared, and thusly allowing the stock to finally rally on increased buying and interest. During those difficult years of 2008-9, AXI had to sell some cheap paper......but large quantities of stock......to small funds, who are in business to make the quicker buck, rather than hold to productiion.
So, to answer your question, even though we are.....as you say.......still stubbornly low, we have just rallied 40% from those lows. And I expect this new and pent up interest to continue throughout the coming weeks.....leading to numerous pieces of news, such as the closing of the $5 debenture, the release of the FS highlights, the execution of the Chinese JV, etc.
Blessings,
Murray