Northern Dynasty Minerals Ltd (NAK)

[deuspronobis]

The problem with call options is that they expire.

To profit from owning calls, you must guess correctly about three things:
1. The direction of a stock's move.
2. The magnitude of the move.
3. The timing of the move.

Given the regulatory hurdles the Pebble Project is facing and the long-term nature of the permitting process, I'd say #3 would take nothing short of a crystal ball at this point.

The good news is, the shares are so cheap here that they're practically a call option themselves, and they never expire. Risk/reward strongly favors the longs here. Either the mine gets built or it doesn't. If it doesn't, the stock may go to zero and you lose $2.50. But if the mine does get built, you have an asset worth at least $200 billion. With 95 million outstanding shares, that's an enterprise value north of $2,000 per share. I don't know how much of that will trickle down to shareholder equity, but it's got be at least three figures. Are you willing to risk losing $2.50 for a potential gain of $100? Sounds like a good bet to me. I have 2,000 shares, and I'm considering doubling down at these prices.