RE:Fish: Thanks for your insight. Hi Rock. I am not sure what you want me to answer to about Pala.
Patchh is right. As far as I know there is actually a data room, it does recieve regular visits. Pala oes not want to sell and as I have mentioned before (my estimate) it would probably take $1.25 CAD to even get a meeting with PALA.
Yes, call Rich. There is a lot that can be said that is not subject to disclosure rules and is also not the type of thing that is required to be put in a news release.
As to sunk cost and asset value... yes, that is my point all along. The share price value (to me or to yanyone else) depends exclusively on the values you attribute to each variable. I have deliniated MY valuations and only a scant few others have ever stepped up to do the same, other than constant bleating about tire fires, "lack of proof" (whatever the Fkuck that is meant to mean) and drole statements about penny stocks etc.
As to "potty mouth"... sorry dogg, I thought I have been quite reserved and respectful of your canine qualities and temperment.
As to the first warrants. They are highly and obviously increasingly, leveraged to sucess and failure or failure. The market seems to be pricing in various bad fish like omens such as dilution or failure to achieve relatively decent production success. I remain on the buy side for the both warrants and here is why:
The work toward the 5,000 tpd (likely) has been minimally impacted by the dike grouting which hampered the 3,000 tpd. In other words the time frame between 3,000 and 5,000 is (likely) shortened thus still giving us 5,000 tpd (or near to it) sometime in Q4.
To the extent that accumuated capital cost (not pure cash "burn") will need to be covered in the short term, everyone including funds (again IMO [the dogg needs this ongoing disclosure or he yowls endlessly into the night.] ) are waiting for everyone else in a kind of game of musical chairs to see how they can best exploit the blood in the water. Funds or big buyers may want to increase their positions now but cannot do it without pushing the share price up. They may hope for a financing to get more shares but it is a gambit that may not work out. The likelihood is that loans of various kind will be used to cover capital (sunk) cost of the dike and other on going mining start up cost.
If the news of progress is good then in three weeks or so the share price can easily track back up. If the shares stablize above 25 cents or even 30 cents (likely IMO) then Pala likely excersizes the first series thus bringing about $50 million onto the balance sheet.
These funds either get used for expansion drilling and capital works or they go to relieve the accordian facility (pay debt back down.) In the good scenario the first warrants go to 30 to 60 cents by year end assuming a stock price of 50 to 80 cents by year end.
In that case the warrants give a 600% or greater return. It is still very likely to happen IMO.
Cheers,
Notgnu
quote=rockhound3]
I was trying to make the point that the value of the PH property is not being reflected in the share price of NCU.
There can be many reason for the difference between the true FMV and the share price, and as you have noted debt/ cash availability is one of them.
However I was thinking back to a PHd thesis of the 1960's where a candidate was trying to develop a stock valuation model and even after taking all of the measurable #'s into consideration there was still a very large unknown which was referred to as EXPECTATION.
I think most would agree that the RISK/REWARD in the mining sector likely results in a much larger unknown EXPECTATION factor. However in the case of NCU I suspect we have a NEGATIVE expectation at work with the value of the property not being reflected in the current share price.
My comment is that if NCU were put up for sale that the price realized would be 3 to 5+ times higher than the current share trading price.
Fish while I think in the mining industry financial. Statements ( including notes)can assist -the fact is that given that financial statements are based on BOOK (sunk costs) as opposed to FMV means that one has to do a lot more than read the notes to the statements to understand the situation.
Thus my hope that PALA puts NCU up for sale!
Fish-please let me know if this note helps explain my thoughts.
tx
ROCK
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