TSX:LSG.DB - Post by User
Comment by
JRaffleson Jan 14, 2016 11:49am
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Post# 24458142
RE:market cap of $538.44 million and a P/E ratio of 43.70
RE:market cap of $538.44 million and a P/E ratio of 43.70A current P/E of 43.70 is indicative of growth expectations due to output or POG.
Assuming:-
- output remains the same as 2014 / 2015, of 180k ounces of gold
- 500m issued shares [actually less than this].
- POG reaches US$1300 in 2016 [say, + US$200], then;
- Increase in bottom line revenue, with the 180k ounces would be US36m = C$50m.
- Increase in EPS would be circa 10c.
On these assumptions, the P/E would fall below 10, irrespective of future production growth.
It is apparent that these shares are being purchased on the prospects of expectations of higher gold prices and sustained productions based on increased reserves.