RE:Mako held down
Mako2022 wrote: Hmm
Is it possible Mko being held down due upcoming consolidation? Any thoughts.
I can't follow the line of thinking there. I don't think it's being "held down" since it really isn't trading much volume. We need to find motivated buyers for the stock to go up. Right now, value investors are absorbing all of the shares junior gold investors are punting because "the stock isn't working".
Generally, junior gold investors don't like share consolidations because the company is doing it to make it easier to raise capital. Mako is rare in that it's in growth mode and return of capital mode. The mine is so profitable at these gold prices that exploration and expansion are more than covered. The return of capital is focused mainly on the debt for now but there isn't much left and the expansion will ultimately more than double FCF.
The share consolidation has a few benefits though: 1) The shares are marginable if they get above a certain price at most brokers. That means people can own more than they otherwise would. 2) It increases the possibility of listed options which increases liquidity 3) it increases the pool of buyers because many institutional funds are restricted from buying stocks below $3.
Recall Mako is also uplisting to the TSX which will further increase the number of institutional buyers. Many US value funds can't buy TSXV stocks.
Hopefully between the above technical changes and continued strong operational and exploration results, there will be more motivated buyers heading our way otherwise the company will be buying a lot of stock back and/or paying a big dividend.
The next 6-18 months have a lot of catalysts and a lot of cash flow. The odds of good things happening for the share price go up every day.