RE:RE:RE:RE:Looks like I started something. I stand by my words.Retiredgeo wrote: Mining companies buy assets to eventually mine, monetize and make a profit on. Everything Barrick and Agnico are making a profit on today they bought long ago. A mining company will pay market value for NFG but not book value because there is no book value. The relationship between market value and an escalating gold spot price today is weak. The relationship between book value and an escalating gold spot price today is very strong.
Why are we here? To get a buy out higher than the current market value or to be the holders of gold in the ground which eventually will be monetized for high profit like Fosterville and Kirkland Lake before us.
Do not buy NFG hoping to cash in on an escalating gold price. It is the wrong type of stock altogether. You want to buy a producer with production worth book value.
I agree with retiredgeo the only thing I would add is that as the gold price moves higher and the producers become flush with cash while there assets in the ground get depleted they go shopping to repleshish those assets in the ground otherwise they will dry up and go out of bussiness so they need to buy up deposits or other producing mines with this rising gold price the existing mines get expensive because you are buying book value .So many will look to buy deposits to put in their pipeline
at fair market value that is much higher than current prices of the shares these jrs trade at Eric Sprott talked about some current buyouts going for 400.00 US$ per ounce in the ground this was when gold was around 600 cheaper than now so to think that higher gold prices plays no part in the eventuall price a Jr will get maybe a little naive it is all connected the JR is just at the bottom of the food chain trying to survive until it can move up the food chain