RE: RE: What am I missing here? ah, er, um - well I beg to differ that those posts represent a "breath of fresh air" or a good breakdown of the financials. Anyone can read the Financial Statements and post on a BB, but what is key and missing from that analysis is any context or background / reality.
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Point is that most investors buy junior miners looking for a "Home Run" - something on the order of a six to 10-bagger, as Peter Lynch would term it. The projected 66% growth over 5-years will not achieve that goal of a ten-bagger. While buying CRJ at depressed levels might get one a double or more on a run up in POG, the real gains are to be made from BIG GROWTH. CRJ doesn't have a firm plans in place for BIG GROWTH.
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But what I don't understand is why as an investor one is so willing to "look the other way" with Bad Management? Is it that you don't care? Is it that it doesn't matter to you that McMillian has been here 17 years and done nothing but "survive?" Is it that one can "see" the growth potential even though management has no plans?
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But hey, let's look at that "astute" financial analysis.....
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First post was all over the board and tried to compare CRJ with TMM and BRD. I already showed the facilities of the comparison with TMM and BRD here:
https://www.stockhouse.com/bullboards/messagedetail.aspx?p=0&m=31867394&l=0&r=0&s=crj&t=list
But hey, then the poster goes on to speculate a bit, speculations which he later contradicts himself....in this first post he says....."I don't see total debt of $14M as big problem." So why later does he say....in his 4th post...."if CRJ can secure a $20M loan at 8%." So which is it?
Oh and he came to the BRILLIANT conclusion that, "There is no question that they will need to arrange for new financing to replace their $9.5M debenture by May 23, 2013." WOW! Talk about restatement of the obvious - this was well stated in the 3Q CC! And one takes this lack of in-depth Due Diligence as "fresh air?"
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Second post was about increasing revenues and how that represents growth. Increasing revenues are meaningless if costs are not controlled. Look, CRJ has HIGH cash costs. Those costs are in the Highest/worst Quartile of all miners! So what if sales go up but all of the money gets spent making those sales? What that analysis ignored was the fact that this company needs CASH! Growth requires cash and significant growth isn't going to come from a net profit of 4 to 5 Million annually!
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Third post was about how TMM and BRD have made BIG moves up based on turn around in production. Nice idea, but to compare TMM's 34% Year to Year increase in production and overall projected growth of 75% OR BRD's plans for 122% increase in production with CRJ's increase in production from 14K oz per quarter to 15K oz per quarter is silly. Seabee needs to be a 100,000 opy mine in order for the economics to work out. CRJ does not have any plans to grow Seabee to this level - oh and if it did, it could not achieve them with out CASH!
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Fourth post was about how the loan situation looks good and creates extra cash from CRJ. Problem is that it ignored the realities - the poster is only reading the FS and NOT talking to the company or listening to the CCs! Post was full of speculations not founded in reality.... it speculated that "if CRJ can secure a $20M loan at 8% due in three to four years at 8% .. The overall interest at 8% would be about the same as they pay now." Huh? You telling me this guy has more insider knowledge that McMillian and you believe him? It was pretty clear that McMillian state in the CC that borrowing costs would be in the 10% to 15% range but require "sweeteners" in the form of equity! Then it continued with more speculation....if this loan did not require monthly principle payments. OK, so getting extra cash depends on a series of speculations not supported by the facts presented so far? WOW! You wanna follow that as "fresh air?"
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Fifth post was some fast and loose, back of the napkin calculations, suggesting a lot of cash coming CRJ's way. Problem is that they are wrong. Poster came up with some speculation as to "cash flow" available to the company that is just wrong! It does not match the figures in the 3Q Cash flow statement. But more to point, in 9-months of 2012, CRJ has generated only 12.5MM in cash flow! This ain't enough cash on an annualized basis to generate any substantial growth - or growth equal to its peers - BRD projects 122%...remember 11 companies project 200% or better growth over 4 years! This is a good analysis of the data?
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So it looks to me like a pretty silly pump job and not a serious consideration of the facts - not any breath of "fresh air" into the CRJ situation.
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But hey, I get where investors are coming from - One is frustrated with CRJ's performance. One feels trapped in the shares because they are so underwater. One realizes that the situation isn't as great as one hoped and one gets frustrated that others see the reality and post it. So when someone shows up and spreads anything with even a modicum of positive tone or "hope" it is attractive and viewed as "a breath of fresh air." Yeah, I have seen that plenty of times on BBs. Retailers hang on to any positive spin that hits a BB as a way to sooth them self from the painful reality. One's whole investment plan then turns on "hope." Oh well, free to hang on to "hope" as a strategy, when many other options abound - and many better than CRJ.
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One needs to put their emotions aside when investing and not be so fast to take spin as great potential.