Interesting risk definitions from Stonegate analysts....Currently STGO stopped wasting time & money on expensive promotional flyers such as "Anal:ysts coverage", but from the last one, May 27, 2021, Stonegate Capital partners updated coverage tells:
"The Company has no history of net income, dividends, or cash flow and there can be no assurance that the Company will be profitable going forward. In the case that the Company cannot create enough revenue to sustain on-going business activities, Steppe’s only source of financing will be through the sale of existing securities, high cost borrowing, or sale of its mineral properties."
"The Company operates in Mongolia and maintains its accounts in Canadian and U.S. dollars as well as Mongolian Tughrik. Some of the Company’s commitments and expenditures are denominated in U.S. dollars making the Company subject to currency fluctuations. Such fluctuations may materially affect the financial position of the Company. The Company engages in limited hedging activities"
Now that predicted risks became real facts. Big4 audit firms provided a clear guidance how to avoid of that high risk fluctuations. But seemed MNP auditor's rejected that, think this is out of scope. Q is: sales of gold in MNT or USD? STGO selling gold not to Central bank, to Commercial bank, instead. Why? because they have gold collateralized contract.
The valuation of SP near future expected to be CAD$ 4.7 as Stonegate's calculation. But SP under IPO since 1 month ago, bouncing between 1.6-1.8.....Which Stonegate failed on that. Most interesting fact is that $ 4.7 used in last news about FRC Mongolia approves 1M shares:
https://www.globenewswire.com/news-release/2021/06/30/2256097/0/en/Steppe-Gold-receives-approval-for-the-cross-listing-on-the-Mongolian-Stock-Exchange.html
"...The Company will raise MNT 5 billion by issuing a total 1,111,110 common shares at a fixed price. Proceeds of this placement will be used for Phase 2 expansion at the Company’s ATO Gold Mine. Five independent analysts forecasted the share price to reach CAD 4.09.."
When SP will up to 4.09 - 4.7 ???? Next year or next 5 years? Or during life of mine period? Uncertainty.....