Post by
redawnliv on May 14, 2014 1:46pm
lsg improving
Lake Shore Gold - Sunshine After Rain
May. 12, 2014 10:05 PM ET | 2 comments | About: Lake Shore Gold
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Disclosure: I have no positions in any stocks mentioned, and no plans
to initiate any positions within the next 72 hours.(More...)
Summary
Lake Shore has had its fair share of problems, but seems to have
turned a corner now as the company should be free cash flow positive
this year.
Based on the current gold price I'd expect the company to make $40M in
free cash flow this year and the following years.
This cash will be spent on debt reduction and advancing the Gold River
project which contains 1.15 million ounces of high-grade gold.
That being said, I think the best way to invest in Lake Shore Gold is
through its debentures which are trading at a discount to par.
The convertible debentures have a yield to maturity of 8.4% based on
the maturity date in September 2017.