Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
So, Bob.......is this good bad or medium for LSG?
I personally find Kaminak Gold (CA:KAM) an attractive addition to my watch list. DYOR.
NY Bob "Gold & Silver have replaced every fiat currency
for the past 3000 years "
Could you give us an example of where that has happened,please, Bob?
I think we also have to remember that the extra mill costs of 10-15m really set things back on their heels, plus the estimate of 2012 production has been set at 85-100,000 oz. We have had two quarters completed and 41000 oz have been poured. There has been no increase in the estimate, so only 41% of the year's output has been poured and we are into the third quarter.
There is some big money owing to big investors and the sooner that can be cleared the better. The market doesn't like big debt-loads. See how the sp clunked when the Sprott deal was announced? I suspect a bottom was reached a while back but on present information $3.20 by year end is my CURRENT best estimate. Any one have any challenges to that? Feel free, I won't be offended. I'm too insensitive!
It's a very good stock, but to answer your question, no it's not going to $10.00 anytime soon, even if a predator comes along.
To get to $10 it needs to do two things. First it needs to multiply its gold production by a factor of a minimum of 3x, and secondly it needs to become debt-free. Neither of those two things are going to happening the short-term.
I suggest a short-term price objective is about 2.20 by the end of this year, given the current rate of resource discovery. If they stumble onto some rich seams then maybe $3.50 by year-end.
In the meantime it still looks attractive, and at the present rate of development the sp should increase steadily. With dips along the way, of course.
Bob, QMX looks interesting as a good investment in several years' time. Right now its market cap is matched by its debt load. Also its cost of production is nearly $1500 per oz.
So, I'd say that the enterprise looks promising, but as an investment it has no attraction at the moment as to buy even at 0.60 has an opportunity cost of an unattractive level. All IMHO.
It's good to see your confidence. Do you have a view as to when LSG will really take off in a strong and sustained way?
I'm not entirely sure I follow each of your points but for the sake of clarity I'd say that there is no cash flow shortage.
However, budgeting on this mill expansion has been very poor. This is Canada not Zimbabwe. The numerical inaccuracy is mind-bogglingly huge, and I hope we are being told everything.
The extra possibly $15m can be dealt with and catered for but it means there is a lessening of the previously perceived momentum.
Cash-flow tightness? They just closed the Sprott deal.
There's n cash flow tightness.
What there is, is a declared screw up on the mill budgeting by between 6m and 15m bucks. (Why the spread in that estimate is so gawd-awful wide goodness only knows.)
Markets don't like it when companies screw up big BIG figures. (Are they really sure there is an unexpected 25% cost inflation for this mill expansion?) That extra cost of the mill could have been used to make more discoveries in promising areas. Until this silliness they were doing both exploration and mill expansion. Now the emphasis is really just on the latter.
I'd say 4 out of five toes were shot off with this weeks news.
Volume 11m today.
Anyone care to suggest whether that was shorters going for a kill, or buyers snapping up a bagful at a low price?
Or something in between?
Yes Bob, shorting has increased.I'm not surprised.
If you screw up the budgeting, and cut back the exploration, it's like saying to them "Come on in. The door's open wide. Bring your Shorts."
Keep hoping then because ...
"Current work at the project includes further research and field surveys to gain additional information regarding the newly identified exploration targets as well selective drilling to evaluate the overall expansion potential at the project...."
Well, that's really screwed it. Down nearly 9%. The market doesn't like the budgeting people to mess up to the tune of 10-15million bucks.
Poor show LSG.
" Exploration activities are being reduced as the Company directs its capital to the development and production ramp up of Timmins West Mine. The surface exploration program for the year is being reduced to $10 million from the previous estimate of $15 million. "
There, any clearer?
Where, in the press release. It's hard to miss.
"Exploration activities are being reduced.."
I don't think the market enjoyed hearing that one, either.
Well, I don't think that the market liked the prospect of the mill expansion costing up to 25% more i.e. up to around $15m more.
No wonder they felt the need to cut back on capex by exactly the same amount. It makes you wonder how an estimate of costs can be so far out of the ball park.
Not a good way of doing things, today.And just when the sp was getting some pace going.
It would seem that many people knew about today's announcement earlier this week, hence the healthy rise in the sp over the last few trading days.
In terms of resource news, it's very good information, even if inside traders knew all about it before the majority.
Whoda thought, whoda known ? lol
It very much looks to me that the strong flow of drill results, etc, was pumped out by TM simply to offset any perceived downside of the Sprott funding.
Now it's old news, the drill news is subdued.....
Wasn't it yet another derivative trade(s)? I think it was, and thus JPM has learned nothing from the previous fiasco. You keep doing the same thing, you keep getting the same result. Why is Dimon still there. JPM have not changed.
Very good to hear about another development at Fenn Gibb today.
Keep it coming TM !
Good charts, Bob.
Bob. I think we all agree with you that Gold will continue to rise in price. And we all agree with you that LSG is amazingly under-priced. I doubt we need persuading of anything on those two scores.
I'm just a little curious about this prediction about Gold gapping up to $3000 overnight. It seems very dramatic and is effectively a 100% increase from where we stand now. I think everyone will possibly feel that such a move would be too much to expect in one night. Is a slightly longer time -frame more realistic?
Based on reserves you are right. The market doesn't seem quite yet ready to re-rate it. It will happen at some point and the only question is when.
TM recently put all the good news out about the reserves increasing and it seems clear that it was an attempt to put octane in the tank before the Sprott deal announcement. Ironically, since the deal there has been nothing new. Perhaps that means it's better to announce ' a Sprott' first, and then announce all the reserves enhancements? I know a co. can't hold on to news to suit itself, though.
The market didn't like the Sprott deal and although the last two days have seen hefty sp increases it is nothing compared to the cliff-fall of the sp over March and most of this month.
To think that just as recently as November it was at 170c....
Blackrock Gold & Gen Fund Manager's comments as at end February
"Gold equities are trading at attractive valuations on a number of metrics.Margin expansion in the gold mining industry has enabled companies to deliver record earnings over recent results.
Free cash flow levels are high and dividends are beginning to be increased. As such, gold equities appear poised for a
potential re-rating."
I think the stock is very attractive. Rome wasn't built in a day but this is an exciting investment.
Bob 'ETF's is the about the first which all going to be ..'
I'm not sure what you are driving at here, Bob.
I was just thinking, Bob, that Gold would have to increase in price almost to 20 times its current level, and in about two and a half years to do this. If people felt it was a high probability I guess they would be storming into 3XBull Gold ETFs.
It's a bullish position, and the bull is definitely I word I'd associate with such an opinion. Anyway, that's just my own opinion.
Thanks for that comment.
NYBob,you say, "PeelGreen you are welcome to have your opinions and
please, respect other PEOPLE's opinions -
thanks in advance"
I may not agree with everyone's opinions, but I don't think I have been disrespectful of any.
Do you feel it appropriate to move YOUR cash somewhere else in the meantime?
Oh, I respect other people's opinions. I just don't think that a technical extrapolation of the gp to $13000 within a couple or three years from now is sensible, and therefore makes charting look silly.
That's simply my opinion. Others will have different opinions.
"Elliott wave predicts $32659 gold on 16 Jan 2015 -"
That's the sort of thing that gets charting a bad name.
Calvf is a very interesting and attractive stock. But it does seem to be similar to LSG in that the more good news it issues the more the sp stays the same or reduces. There seems to be nothing wrong with the company (except for a bit of geo-political risk) but the market seems in no hurry to re-rate it.
CALVF is one of my favourites too, but I haven't invested yet. It seems to have been around the 9-11 cent mark for an age, and the only question I have of it is when it might start to make a sustained move for fundamental reasons. Any views you have here would be very welcome as this stock puzzles me a little.
Bob, I don't understand why you posted that reference to the Hitler/Rothschild speculation. Has it something to do with LSG?
Despite very very attractive value here, the sp performance over 5yrs/3yrs/1yr/6mths and 1 mth remains down. The market still appears not to accept LSG as a legitimate investment based simply on share supply and demand.
I know, like we all do, that the idea is to buy low and sell high but those now wishing to buy low may understandably wonder how much lower LSG might go from here before they should buy, given the 1 year look, and despite lots of gold now beginning to pour.
Those investors five years ago must wonder what exactly they saw that attracted them. In the long-run I'm fairly certain we're all dead.
The risk right now is that, whilst the market won't seriously countenance LSG, a preditor will.
That sounds exciting for the sp.
It is, except that an improved sp, resulting from the boost given by an accumulating preditor, will still result in a buy-out at a ridiculously low price, and lower than the sp at which many previous investors will have bought, having already recognised genuine value.
There is a way to overcome this, and this is by the directors regularly flooding the market with as much good news as they can muster and giving presentations to the institutions. I can't understand what's holding LSG back on this aspect. It's been several hours and a lot of minutes since they issued some good news! lol.
Seriously though, they have issued quite a lot of encouraging news over the last few months and I applaud that, but the Sprott facility, designed to address the infrastructure of the Balance Sheet, has clearly not been accepted by the marketplace.
I think we might have to expect the directors to re-examine whether they are getting the good news understood, because at the moment I don't think the messages are sinking in. That makes LSG vulnerable.
Only directors with huge swathes of attractive in-the-money options, vesting at buy-out, will be keen to give house-room to a preditor.
TM has referred to this today as the market concerns with the Balance Sheet. Something which he describes as being addressed today as a result of the Sprott finance facility.
These credit facilities appear to be easily serviced by the growing gold pour. That's the company.
As far as the market appraisal is concerned, the robust range of credit facilities is not entirely welcome and the sp is unlikely to retrace its path to 1.60-2.00 without a flowing stream of good news.
The Sprott deal will not be looked at by Wall St or Bay St as a wonderful serendipitous creation, despite what TM says.
Of course it may be the company's intention to maintain the recent strong flow of news on reserves because it may be able to do so, but it needs a dickens of a lot of that news.
The resolute and continuous destruction of the share price over the last few weeks has been so strong as to almost make LSG a takeover possibility. We should be so lucky.
Let's hope the company really can keep a flow of happy news on the wires.