If the markdown took place outside of a cyclical correction? You would be crazy to buy this stock, I agree. However the current markdown is not particular to only Banro, it has hit the entire Gold mining sector down to multi-decade lows. Now in this scenario the prudent thing to do is to look for the most beaten up stock or company, that has staying power, for when the cyclical rebound does occur we will reap the highest returns. Yes its possible the cyclical downturn is so great that many miners will go bankrupt or have to merge to exist. And hence we have current price levels in expectation of bankruptcy or merger. Now in this case you have to consider net debt to asset ratio, current income, and money already spent. Do the math you will find Banro is the rebound stock to select with staying power!
