New to this board .. hopefully someone can help me..Hi folks, I have just recently picked up on Cadente Copper as a result of the RFC Ambrian updated report in December. There seems to be a big valuation gap here versus other exploration or PEA/PFS companies. I have done a lot of reading to try to figure out if this is due to political instability, or infrastructure or location issues, perhaps low grade or high strip ratios etc.. but so far everything I have reviewed on Canariaco Norte seems relatively positive or above average and no big red flags bar one -- the fact that Cadente has next to no cash in the bank and needs to do a capital raise or debt offering of some kind, as there are only so many properties that they can sell off to keep the balance sheet in the green.
It would seem to me that in August last year Fortescue jumped in for $1.1m and gobbled up 20% of the business for an absolute bargain.. sure, they can bring more than $$ to the table here, but I am scratching my head trying to figure out how selling 20% at a $5M valuation was in anyway good for existing investors, when at the time the market cap was around $20-25M??
I want to take a position in Cadente, but the poor cash position and lack of understanding of how the company plans to address this are concerning.. who is to say that they just don't "give away" the rest to Fortescue or someone else at a ridiculously cheap valuation that is only marginally greater than today's price?
I have seen some of your valuation calculations here putting Candente in the $1.50 range.. which if you look purely at take over prices for PEA/PFS stage company, my math puts it between $0.83-$1.67 counting only the 7.5B M&I Cu at Canariaco Norte and ignoring the upside potential at Canariaco Sur and Quebrada Verde.
So why the massive valuation gap? What am I missing?
I appreciate any insight you can provide.
Sampo