RE: RE: RE: RE: Financial post-Retiree Firstly, it wasn't "analysts", it was one analyst out of the 5 or so that cover Krn. The one analyst lowered it from $12 to $10.25 on dilution that is expected . That analyst still kept a buy rating on the stock, just like all the rest of the analysts.
And I clearly stated the reason in my last post, but will once again restate it.
The dilution required for Krn to reach production is another $240m to be raised over the course of say the next 18 months of the build. On any deal that a junior does , it is a requirement that they spend the cash first before they can touch the debt.
So if Krn can get 50/50 debt to equity, please apply that metric to EPO and use any price you want. I'm telling you now that this will be a $4B project like K&S , but for the sake of argument lets use the $3B in the pre -feas and ignore the fact that all the juniors have a higher feasabillity figure then was in their pre-feas, and that is why the banks don't accept a pre-feas.
So explain the dilution on 50% of $3B, so instead of the 8 Billion shares I said they would need to issue, let's just call it a nice round 6 billion shares on top of the 300m that EPO already has and the extra 100m or so shares it will need to issue in the next year or so to cover the feasabillity costs and the environmental.
if you think 1 analyst lowering a price target by $1.75 because of expected dilution of $240m is bad, wow, you are in for a world of financial pain with Epo. They won't be able to raise $300m IMHO, let alone $1.5- $2B.
Shareholder value would be decimated if EPO had to raise $300m. You would have more than 1.5B shares outstanding and would barely have 10%(using the fantasy figure of a $3B capex)
You should stay away from the real world of Krn being the next and IMHO only one of the Sask juniors to make it into production, and instead stay firmly wrapped up in dreamland where reality can not affect your financial dreams.