Clubfoot to the Woodshed Our know it all board oracle Clubfoot obviously thinks he has all the answers to not only everything Taseko but the entirety of investing in general. So, let's take a quick second to whoop his azz back in the woodshed, shall we? Of course, so here's just a few nuggets for ole Clubby to choke on...
First, Ole Gib ain't no boat anchor. As we've said multiple times, it is what it is...a low grade asset that is fairly predictable. Does it suffer during periods of extended low copper prices and unexpected hiccups from bad weather or other factors that raise its C1? Obviously, yes. But Clubby, how do you think Taseko got to where it is today? Gib was their first and lone asset in its inception. It has paid the bills and allowed them to expand, period. So, you can rag on ole Gib all you want but it has produced as expected and, more importantly, the chances of copper heading back to sub $3.50 US are highly unlikely. Further, they now have additional ownership at a company friendly deal. Second, your valuation of Florence at $600M is at what? $3.50 US copper? Must be. At any rate Clubby, as you are aware, that C1 of $1.11 has a larger earnings multiple effect when copper prices rise than other producers experience. That $600M valuation you cite ain't even close at $4 Cu and explodes at periods of $4.25 and beyond. News flash Clubby, that's why most of us are here, a producing Florence with an expected multi-year period of $4+ US copper prices. Now, does that calculus change if they don't hit their stated marks and / or copper prices plunge for an extended period? Again, obviously yes. But yet again Clubby, most of us here have done our homework and don't expect that to happen. Otherwise, we wouldn't be here, right? Right. All investing comes with a risk and that's the risk we are taking. Moving onto Taseko debt, agree Clubby, it's currently substantial and needs to be properly dealt with. That said, the Stu portion of StuRusty has to date proven to be a credible financial steward of company funds. Let's just say we agree but we tie that all in with the risk we are taking for a successful Florence project coming to fruition. If Florence produces as expected on time and within budget, save a Q or maybe 2 max with a + say 10-15% max over budget, those debt concerns will be easily handled. In the meantime, current copper prices with typical Gib production brings in some decent cash and they do still have other options available that are non-dilutive to equity shares. So Clubby, even a part time swing investor such as yourself has to agree that a producing Florence at $4.25+ copper changes everything for this company's future. Instead of coming here daily acting all high and mighty with your extreme knowledge of how everything works, maybe just start with the baseline knowledge that the overwhelming majority of everyone here is in the same boat of investing in Taseko based upon the above set of details. If they fail at Florence, we'll lose. If they're successful, we'll bank some substantial gains. Such is investing. That said, you're still missing one last very important detail: to this date, practically NIL is factored into its current share price for a successful outcome at Florence, maybe a US .25 cent piece tops, more like a nickel or dime. That's the differential we've found and continue to invest upon. Now, forward looking, Taseko can bank two years of profits from Florence, start paying down some debt, set sights on Yellowhead, sell off some NP ownership and away they go. Something to that effect, anything similar will do.
Okay Clubby, that's enough for now. So, take your day trading behind back to the woodshed and give yourself a well deserved flogging.