NCU relative to NCU in June/July 2020At the time of the July 2020 financing NCU was in rough shape.
NCU came out of that finacing at $0.14 per share and the share count went to 1.5 billion.
Copper at that time was $2.95 per pound and it even dropped a little (to about $2.86) during the financing closing period. The point here is that the outlook was a bit dismal and yet new money was deemed worthwile at an investment that came in at about 20% to 30% below the previous few weeks trading price (about $0.19.)
Now 7 months further on the risk of punitive mezzanine financing and bankruptcy are gone. The mine and mill are basically complete and running at half production with a near term increase to the full 5000 tons per day. They share count is now about 1.7 billion but the $33,000,000 brought in paid off the debt overhang and some upcoming bills. Cash-flow, though not at full run rate, will be coming in as we speak.
The big difference is the rise in the price of copper and outlook for copper. At the Juy 2020 time frame copper was $2.95 minus $1.89 cost for a gross profit of $1.06 on annualized production of about 61,000,000 pounds of copper.
61,000,000 pounds X $1.06 = $64,660,000 x (let's use a multiple of 4) = $258,640,000 divided by 1.5 billion shares then which = $0.17 per share with no value attributed to the open pit.
Today copper is $3.63 as I write this. Subtract $1.89 cost = profit of $1.74
Multiply $1.74 X 61,000,000 pounds x4 (a low cashflow multiple IMO) = $424,560,000 + $33,000,000 from the recent finacing = $457,560,000.
Divide $457,560,000 by the new 1.7 billion shares = $0.27 per share just to be on par with the July 2020 financing. Add back the $0.05 share drop when that financing occured (even though copper went up during that June to July 2020 period and you get a copper and financing price adjusted equivelent share price of $0.32 today.
Why do we trade at $0.18 area today instead of $0.27 to $0.32? I think it is simply that past shareholders are wanting us to get a great deal... or something along those lines anyway.
DYODD
Buy up and be counted.
Cheers and happy speculating,
Notgnu (aka Notgru, Notaguru, Snots and hopefully something Gnu soon :->)))