RE:Warning ! This post is going to be very bullish, must be 19 This is one of the most enjoyable posts that I have read in a very long time. Some very insightful modelling information (I've added it to my modelling) and a good hearty dose of humor, wit and satire. A breathe of fresh air. Thanks Goaweigh. DD
Goaweigh wrote: years or older and of sound mind to read it. If you don't qualify go immediately to Willards posts and stay there. Don't even glance at this, but if you must under no circumstances should you buy this stock based on anything written here.
OK, Here goes.
I've been looking at other successful mines in BC and the one that I find most interesting is Pretium.
Pretium is 15,600,000 tons @ 16.1 grams which values their rock at $ 670 per ton.
That's an insitu value of $ 10,450,600,000 and it's market cap is $ 2,540,000,000.
That's $ 163 per ton of mineralized rock or about 25 % of that $ 670 per ton.
And that mine is remote !
That's a pretty high bar to meet or exceed but I think we might actually be able to do it.
My base case ( worst case actually ) is 10,000,000 tons at $ 250 rock so that would give us an insitu of $ 2,500,000,000 and if the market gave us a valuation of 25 % we would be trading at
$ 625,000,000 market cap. Now I presume Pretium is at such a high value per ton because it's very profitable inspite of it's remoteness and large capex so maybe we cut back our valuation to only 15 % per ton or $ 375,000,000 market cap. Still pretty good.
Now in my mind the Blue Blob has plenty of room to fit in a 16,000,000 ton ore body just like Pretiums and we know this area can produce spectacular grades such as
( Northgate Hole @ $ 1455.70 per ton ) and ( Hole 12S-05 @ $ 1077.79 per ton ) but that's unrealistic so let's just use half of Pretiums rock value of $ 670 per ton and use $ 335 for our valuation.
That would be 16,000,000 tons @ $ 335 for an insitu of $ 5,360,000,000 and if we use only 15 % we get a market cap of $ 804,000,000.
So that would give us a price per share range of $ 25 to $ 53.
Maybe the market gives even less value per ton of rock containing silver vs ton of rock containing gold ( of equivalent value per ton ) but I don't know why that would be but as we are in an area that's very easy to access and our capex should be much smaller we should get a decent valution .
I'm looking forward to GGI's assays and rock values. Unless they are a complete disaster Mr. Sprott and his group are going to be pushing that hard and that should have a very positive impact on us when our hopefully spectacular assays arrive !
Oh and thinking more about Pretium and their " Valley of the Kings " I think NNA should consider using " Valley of the Queens " for our project in honor of our Silver Queen and Ellen !
Of course we may not be in a valley but " Hillock of the Queens " just doesn't quite do it so....