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Thank you, everything points to some kind of negotiations going on and no use wasting time updating presentations and publishing updated reserves not due until end of May.
Only 56,000 shares sold on PTQMF and PTQ.TO. Everyone who wants to sell has sold. Something is up.
Inmet seems the most logical for a stock swap buy-out. PDI is ramping up to build all the things the Inmet will need to start-up operations and expand its labor force (roads, houses, electric power stations etc.) Makes a lot of sense if they can agree on value.
IRS rules state that at least 50 percent of the spun-off shares must be held for two years by the shareholders who received them or Company faces a tax liability. I doubt this means much as PTQ is Canadian Comp. and Major owners not from U.S. Still looking but can't find any mention of holding period in Canada. Don't see any reason why they couldn't take it public asap.
Inmet would probably offer a stock swap to buy out PTQ. My guess is Inmet would initially offer 1 share of Inmet for every 100 shares of PTQ and work up from there.
One of my friends asked me when the holding period for short/long term capital gains calulations for PDI will begin. In the U.S. the holding period start date for PDI shares is the date you bought the PTQ shares. That's nice because the one year wait time to qualify for long-term capital gains tax treatment is lessened or eliminated.
Canadian tax law regarding spin-offs is basically the same as U.S. tax law. The only difference I could find is PTQ must obtain a favorable ruling from the Canadian Revenue Agency and provide details on how stock options and warrants will be divided. If approval from the Canadian Revenue Agency is not obtained and the spin-off occurs, then the transaction is taxable.
The only thing I found in the SEC regulations is the valuation is based on the share price immediately AFTER the spin-off occurred. I didn't see any discussion of aggregate sales or other PDI related sales in last quarters MD & A. Did I miss it?
It's hard to put into words what PTQs efforts to help the local people and meet environmental standards will mean in the long run to the share price. It hurts the share price right now but not to any great extent. How much higher do you think the share price would be if PTQ weren't making these efforts? One or two cents higher? The world environmental movement is very powerful and if they take a disliking to you, they can do a lot of damage quickly (such as, as we have seen recently, protest that shut down roads and production). Think of the damage if some news organization goes in and slants interviews with local leaders and PTQ workers that show poor wages and substandard living conditions in the area. Providing workers with decent wages, clean water, decent housing, an education for their kids will build tremendous loyalty from these workers. Every business operation in the world requires worker loyalty. The money spent now to help the workers and the surrounding communities will be paid back ten-fold by these same workers over the next ten years. In addition, there is no guarantee that the political support for mining will last beyond the next couple of years. If the local people and politicians support mining then possible adverse laws effecting PTQ (such as raising the royalty rate to 25 percent) can be mitigated or avoided. I know we all want to make money as quickly as possible, but it is not going to happen for another year. I hope PTQ continues and even increase these efforts as it will pay off in the long run. If you can't wait long-term, find a better/quicker return - I'm sure there are lots out there that are easy to find. I'd give you a recommendation but I don't know of any.
In response to your question on when can PDI shares be traded. For PTQMF, PTQ under Section 14 of U.S. Securities and Exchange Act of 1934 must meet four conditions and then file an addition form. The conditions are 1) Shareholders do not provide any compensation for receiving spin-off shares, 2) Distribution of shares is pro-rata, 3) Adequate info is provided to shareholders on the new company, and the effect the spin-off will have on the existing business, and, 4) Must have a valid business reason (such as separating out a different portion of the business that allows management to focus on the remaining portion of the business}. When PTQ issues its information statement to us in May, it should satisfy all four of the requirements. Then, after the spin-off actually occurs, PTQ must file a Form 10 Registration Statement with the SEC. The regulations state that trading can begin on the day after the Registration Statement if filed. If PTQ has the Registration Statement prepared and submits it a day after the spin-off occurs, then trading of PDI can commence on the following day. As for shares traded on TSX I'm looking into it. The DAX is difficult because I can't read German.
Oops, it probably doesn't matter because when you sell your shares after the spin-off you'll probably have a tax professional do the valuation calculations, but, the new tax basis amounts must equal the original investment amount. In the example I used, the original investment was $4. My final calculation of 94.5 cents each for the 4 share of PTQ and 5.5 cents for the one PDI share do not total to $4. I forgot to divide the PDI share value of 5.5 cents by 4 (there are four shares of PTQ to one share of PDI after the spin off), so the adjusted tax value for PTQ should have been 98.63 cents a share. 4 times 98.663 cents plus 1 at 5.5 cents equals the $4 original investment. Thanks AJ for calling me and letting me know what an idiot I am. GFY
The spin-off of PDI is not taxable until you sell the shares (either/or both PTQ and PDI). For tax valuation purposes, this is how it works: Let say you own 4 shares of PTQ that you paid $1 each or $4 total. On the spin-off date suppose PTQ is valued at 40 cents. There will be a new value for PTQ and an initial value for PDI immediately after the spin out. Lets say that PTQ drops to 36 cents per share and PDI starts at 8 cents per share. As you only got 1 share of PDI for every four shares of PTQ, the PDI value ratio for calculation purposes is 2 cents ( 8 cents divided by 4). To determine the tax basis allocation percentage, you divide PDIs valuation of 2 cents by PTQs 36 cent valuation or .0555. Multiplying .0555 times your original investment of $1 per share gives you a PDI tax basis per share of $0.055 and a PTQ per share tax basis of $0.945. Again, you don't have to consider any tax consequences until you sell any PTQ or PDI shares after the spin-off date.
Reading Inmet's analysis, I noticed that they didn't talk about what they were going to do with the gold and silver. Inmet stated that it was going to pipe the copper slurry to the coast for shipment and bag the modo. Is this one of the two things you're talking about? Does PTQ own the gold and silver or are they just negotiating with Inmet to refine it. I have no idea what the other big thing is.
It would be nice to see PTQ management buying shares on their own.
I like what the company is doing but I wish its projections weren't so far off. I don't think everyone would be so upset if we had just missed by a little. It seems the company is scaling back future projections based on timeframes to purchase and install new equipment which is good. Posters have a good point that the company shouldn't make projections for 3 month periods that could be significantly off. The really good news is that the analysts are sticking with their projections for $1.70 to $2.00 by calendar year end. Why would they risk their reputations on a management team they didn't trust? The average number of shorts for the last couple of quarters is less than 500,000 shares. How much money could be made on shorting that small amount of shares - $100,000 to $200,000? Peanuts.
Boy was I wrong. I thought production would be over 20,000 ounces. Goes to show you what I know. Projected production for FY 2012 is now being projected for FY2013, a one year delay. Everything else was good. I thought Fifer answered a lot of questions and touched on all the major concerns including the SP which he thought was so low as to justify large buy-backs for the next 3 months. Bringing ore from Spain for processing in Panama in order to finance exploration and start-up operations in Spain is smart. They must have gotten approval to mine the ore and load it in shipping containers without the overall EIS being approved. They must be projecting excess milling capacity in Panama for the next year which I don't understand. I thought the addition of the crushers would bring the mill operation to capacity? PDI is ramping up nicely. New contracts are good. Updated reserves along projected guidelines is good. We're just a year behind from where we thought we would be. That sucks but I can wait.
Have they received there environmental approvals and/or started drilling at LomPoy yet? Lots of gold and silver as well as zinc and lead. Portugal doesn't seem important when you look at the billions of dollars worth of ore at LomPoy.
Is there an inferred number of gold ounces from these studies? Wonder if they'll project any inferred ounces in the year-end update?
I bet they wish they could buy more at these prices. Too bad they have a cash shortage. But I agree, the fact that they're buying what they can is a good sign.
With this increase in volume over the last few days, something is definitely going on. Who would sell 200,000 or 300,000 shares at 50 cents just prior to PDI coming out? That really boggles my mind. Some type of game is being played but I have no idea what it is. Time will tell.
The reverse is also true, it would be to PTQs advantage to run up the price just before the deal closes. I'm sure a couple of million dollars of quick purchases would do it. I'd do it but I don't have enough money. Maybe MJK can help us out!!!!!
Maybe the people who are shorting the stock are selling small amounts to each other at lower amounts to keep SP low. As most people are unwilling to sell until PDI issue is over, it doesn't take much to move the SP lower. As noted on this board, big moves have happened on ridiculesly small trades. The people shorting the stock are taking a big gamble as the SP could shoot upward big time on any really good news.
I don't think gold will drop below a $1,000 an ounce either, however, it may be that a lot of investors think it might and that could be what's keeping the mining sector down.
I haven't been able to figure out why the stock hasn't move back up to over a dollar based on projected earnings. IMO, the market believes that gold will take a tumble to below $1,000 an ounce in the next year. China's projected growth rate is having a hugh effect on the mining stocks as evidenced by todays large drop in SPs for all miners. Until the market is sure the price of gold is steady, our SP will be in the toilet.
Inmet has lots of cash!!
What a dunce I am. Dividing $11.3 million by 525,000 ounces is $22 per ounce. That really does suck. Hope they get a better price at final negotiations.
I missed the $22 per ounce 36 percent discount pay back. It wasn't in the news post I read. The post I read said it was to be finalized at negotations. If it is $22 per ounce, that sucks. Also, silver pours at LomPoy are at least 21 months away. They must be getting enough silver from Mojolon operations to cover the silver payments until April 2014. I don't like that they still have to borrow but they have a lot of irons in the fire with drilling in both Panama and Spain and plant expansion both milling and heap-leach. Overall, I still think it's a good deal.
Inmet announced results of its drilling program for the Balboa property. I was struck by the low grams per ton amount of gold, although it totals to more than 8 million ounces. I don't know the process for extracting gold and silver after the copper is extracted. If it's a heap-leach process, they're going to be building some hugh head-leach pads.
Great news on the agreement with the German Bank. Millions in new funding at less than 7 percent interest for 4 years. Wonder what value they'll negotiate for the silver repayment? I would guess around $30 dollars per ounce. Also, I didn't know they would produce that much silver so soon. Now they have enough to go full bore on LomPoy.
Everyone, we're not pumping or blowing smoke. The last four quarters earnings are: 2.1 million, 5.4 million, 5 million, and 8.9 million. Prior to a year ago, we had only losses. Notice any trends? The earnings equate to around 9 cents a share. The SP should be somewhat higher on 9 cents EPS but aren't. PTQ is slowly but surely increasing production and quarterly earnings will increase accordingly. Also, we haven't hit the high grams per ton ore yet which when we do, will further increase earnings. 20 cent quarterly EPS is coming. We who are optimistic believe the SP will go up with EPS. I guess if you don't believe it will happen it's time to move on. But before you do look at the trends.
MJK, did you buy that 1,500 share purchase at close of business to push the SP up to over 60 cents? Hugh volume today 17,500, what a joke. Nobody's selling. Nobodys buying but why should you buy now if you think the SP won't go up for another six months? People will be kicking themselves six months from now when they realize they could have tripled their investment in just six months!!!
P/E 2.29? Que pasa!!!!! Should be trading over a dollar.
I agree on PDI not being spun-out. Less G&A. Can't figure out why they want to spin it out. Might be they have too many irons in the fire with LomPoy and expanding PTQ and can't devote the time for the PDI side of it. How old is Fifer? Maybe he's looking to retire after PTQ booms. With heap-leach, PTQ should last for at least 20 years. Maybe PDI will last longer but I don't think this management team will be around to see it. A 100 years to you all.
Great news on Inmet. With that much money, they could make a decent offer for PTQ. Things are falling into place for PDI. I'm looking forward to the prospective on PDI. PTQ will probably announce more contract awards for PDI prior to the prospective. A good projection would up PTQ's SP IMO. I suppose it would drop after PDI shares issued but hopefully not as much as it rises. Lots of good news on the production front. I still believe they will approach 25,000 ounces this quarter. Remember, they've already done a 25,000 ounces quarter in the past. I think we're dragging along the bottom and will go up fast in next six months. Lets hope!!!
The forth mill was installed at end of Jan 2012. My guess is they will process 330,000 tons thru mill this quarter. If gpt is 2.0 that means around 23,000 ounces poured. Add in 2,000 ounces for heap-leach and we could get 25,000 total ounces. This should equate to a quarterly EPS of around 6 to 7 cents. I don't believe the stock will drop based on those numbers. Also, I don't believe that PDI is reflected in SP. Maybe this quarters fin statements will show some sales to Inmet. It's hard to believe that PTQ without PDI is just worth 42 cents per share. But who knows.
Per MJK, within a year they will have heap-leach pads in place processing 740,000 tons every 65 days -70 days. Should be doing around 4 million tons per year which yields around 35,000 ounces per year. There's no reason they can't increase that 5 fold to 20 million tons per year or 175,000 ounces per year. Will it happen tomorrow. No way. Will it happen within two year. Why not. Once PDI is up and running, aggregate disposal won't be such a big problem. Is this pie-in-the-sky? Pipe dream? Could be. It could be that because the Inmet deal was delayed for so long PTQs production expansion plans were also delayed because it would be too costly to move the aggregate twice on its way to PDI projects. Management projected production and EPS based on Inmet and looked naive when the numbers weren't met. The set back in production was around a year. I don't see anything slowing expansion down now that Inmet will start operations. I believe the company can obtain necessary financing to grow. Is there something that you see that could slow the forecasted growth in production? Things can always go wrong. The price of gold could drop or the political situation could change but I think the risk/reward ratio makes current SP a steal.
The heap-leach potential alone could get them to 50,000 ounces per quarter. It's going to take more than a year but it's coming. IMO LomPoy production is still two years away but think of the EPS when that kicks in!!!
IMO, It's going to be a combination of things. Mining law passed, Inmet ramping up. Processing through the mill and heap-leach pads will increase dramatically so we will beat the EPS forecast for next quarter and pour well over 25,000 ounces. This will make us a mid-tier producer. The 43-101 coming up at fiscal year end will substantially increase reserves for both mill and heap-leach processing. As more and more good news is announced, it will make large buyers now sitting on the sidelines make their move. Look for several large trades (millions of shares) at jumps of 5 to 10 cents each trade. Then it just takes off as more and more traders rush to get in before it's too late.
The trading volume is non existent. Nobody wants to sell. The only people selling are those who had a few shares and wanted to get rid of them or are desperate for money. The people who are buying are grabbing a few shares at a time so as not to drive the price up. When you look at what this company will earn a year or two from now with milling and heap-leach, you have to shake your head and wonder why anyone would ever sell a share. Especially with PDI in the wings. Two years from now, the EPS will be over a dollar per year. That's more than what the stock is selling for now. IMO there's going to be a one or two week period in the next six months where the SP triples. I'll bet a lot of people have PTQ on their radar but believe they can wait another year and still buy in cheap. IMO they'll be shocked at how fast the SP goes up once the real buying starts.
mines a 93 honda accord, 470,000 miles and still running good