Signal Gold Inc T.SGNL

PEA News - Share Price Thoughts

[yhzsailor]

Here are my thoughts on the PEA and share price: 1. Great NPV, and the PR provides two numbers to chew on: C$542M @ U$1550/oz, C$700M @ U$1700/Oz. The mine makes money and generates positive cash flow. 2. Notice the inclusion of $480M in potential tax revenues in the PR. This is signaling to politicians and regulatory bodies the value of this deposit to a cash poor government. Particularly in advance of an updated Environmental Review, Permitting Process and limely Provincial Election. 3. Stock is still too widely held by retail investors which guarantees a supply of shares ready to be day traded on news and keeps the price down. 4. Institutions are more likely to participate in private placements and /or other upcoming other financing methods (convertable debt maybe?) or through more sophisticated means (flow through shares with their tax benefits) of acquiring shares than buying on the open retail market. 5. It is hard to figure out the value of ANX as a complete entity from this PR. There is no mention of cash flows / NPV of Point Rousse projects. We know the company is cash flow positive on those projects and seemingly will be for a while. I understand the need to market the Goldboro deposit, we hold shares in a larger entity, and some guidance on the present value of the larger entity would probably be helpful to the share price. 6. The current Academic Book Value of shares (based on fully diluted basis) is, in my view and opinion, between $2.90 and $3.80 based on this PEA and without any consideration of the NPV for Point Rousse cash flows. 7. The shares will not trade at that valuation due to the wide retail base who don't necessarily have the necessary information, patience or ability to hold their shares and therefor continue to sell at a discount potentially to others who also lack this knowledge- but hopefully to more sophisticated investors. In addition there continues to be uncertainty about the outstanding environmental permitting processes, and no feasibility study or mine / mill design completed, so the market factors this into the share price. To move the share price: 1. More Institutions 2. Continue demonstrating upside mineral resource growth 3. Finish Environmental assessments and feasibility studies. 4. Demonstrate there is political / social acceptance of the project. 5. Position the project as a turnkey acquisition for multiple possible acquirers (bidding war) who need to increase their reserves . Preferably someone with deep pockets and an offer that allows either for cash or stock in order to save on capital gains. r

[sooner1]

Excellent analysis yhzsailor! Appreciate the input!

[SgtFriday]

Excellent. This is what I'm talking about. Intelligent and informed. And you're correct. We will start seeing more institutions getting their clients into ANX (they need an analyst to recommend to cover their *ss). It takes time to digest, keep an eye on volume and how it affects price...over 2M+ around the $1. Good start to consolitation. Like I said before...a RELAY.

[danieltijana02]

How do you come up with C$3.80 per share on 186 million shares fully diluted? That makes a valuation of C$707 million. What developers in PEA stage are you aware of that are trading at 1.2x NPV at $1,700/oz. As almost always occurs, NPV drops from PEA to FS as costs are stricter, higher contingency used, and less material in mine plan.  If assume C$600M NPV in FS, and you are sugesting $3

[yhzsailor]

Daniel, I made the point quite clearly this was an academic valuation ($700M/186M shares outstanding) but then in all the points that followed I pointed out the reasons why it would not be trading at that value now, including referencing the social acceptance , mining regulation and so on. I did not say it's market value was $3.80, I said it's value in a purely academic "intro to