OTCPK:MEAOD - Post by User
Comment by
mstettleron Sep 16, 2016 4:45pm
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Post# 25246810
RE:Mstettler...something to look at
RE:Mstettler...something to look at Hi Fruitvale, I did not listen to the presentation that you provided the link for because I generally do not like to have my research influenced by either company management or stock promoters.
I'll also not spend too much time on the company here as it isn't really the right place for it; useually I only mention other companies a a way of pointing out that there are much more compelling cases for investment than MTO at this time.
Some time ago Luna ran into trouble with lower than expected production/higher costs and I stopped following the company given the carnage at the time in general in the sector.
More recently they have replaced the management and executive with some well known names, guys with a solid track record who can get the job done.
The new PFS is very compelling. It is actually similar in a lot of ways to anna paula (TMM). The relatively low capex yields an IRR of 34% @ 1250, and 41% @ 1350. Production is set to be 150K oz per year.
A few negatives - there is currently only a 6.5 year mine life but that has potential to expand. They are at least 24 months from production. I'm not clear whether SSL still has rights to production? Do you know? They are in Brazil which is well known for mining but also not as solid as some other locations. 85 million market cap seems a little high to me, personally, but if it has a steady uptrend it doesn't matter.
Compare it to something like FPC however. Same team as the original OSK (sean roosen, luc lessard). They are in quebec at the old noranda camp. PEA outlines 12 years at 236K per year with AISC of $427 net of silver, copper & zinc credits. Until very recently were trading at 100 million market cap, now has gained <25% since I last mentioned it here (as of today's close).
Negatives; they are at least 4 1/2 years from production, it will require 900 million capex which yields 20% IRR at 1250 gold. Still, top notch people in a top notch jurisdiction.
I own FPC. I'll probably take a punt on LGC when it looks like it has resumed it's uptrend. I had another bid on SA (mentioned yesterday) filled at .76 this morning; it closed at .82 based on the news of the JG ipo trading this coming monday. SA now owns 43% of JP (as well as 7.5 million worth of OSK, formerly oban). We will see what price JP comes to trade and that will give us an idea of where SA should be trading.