AI
Saturday, September 21, 2013 11:34:08 PM
PVG Gold...
As investors dump precious metals stocks en masse, this is one of the babies being thrown out with the bathwater and offers long-term investors tremendous value.
http://seekingalpha.com/article/1693932-pretium-resources-current-valuation-offers-acquirers-an-accretive-transaction-even-at-a-40-premium?source=yahoo
Based on the estimated economics of the Brucejack project, Pretium Resources is undervalued and using a conservative $700 per gold-equivalent ounce life-of-mine cost, this company should be valued closer to $11.00 per share rather than its current $7.50 valuation. If bulk-sampling results verify the project economics (and some drill intercepts are looking very good), then Pretium Resources can easily offer investors almost a 50% return based on a conservative $700 gold-equivalent ounce life-of-mine cost (investors should remember that the average cash cost for miners was more than $700 in 2012), which means that this company is one of the few explorers and miners that is significantly undervalued even at current gold prices and does not need a large rise in the gold price to justify an increase in its share price.
As investors can see, even though the Brucejack project is fairly large, it is not the largest project in terms of gold reserves; with other explorers having larger potential deposits such as International Tower Hill's (THM) Livengood project (almost 10 million gold ounces) and Chesapeake Gold's (CHPGF.PK) Metates project (18 million ounces of gold reserves). But the true value of Brucejack lies in its high-grade characteristics, which makes it much cheaper to actually mine the gold - grade almost always trumps quantity when it comes to exploration companies.
As investors dump precious metals stocks en masse, this is one of the babies being thrown out with the bathwater and offers long-term investors tremendous value.
http://seekingalpha.com/article/1693932-pretium-resources-current-valuation-offers-acquirers-an-accretive-transaction-even-at-a-40-premium?source=yahoo
Based on the estimated economics of the Brucejack project, Pretium Resources is undervalued and using a conservative $700 per gold-equivalent ounce life-of-mine cost, this company should be valued closer to $11.00 per share rather than its current $7.50 valuation. If bulk-sampling results verify the project economics (and some drill intercepts are looking very good), then Pretium Resources can easily offer investors almost a 50% return based on a conservative $700 gold-equivalent ounce life-of-mine cost (investors should remember that the average cash cost for miners was more than $700 in 2012), which means that this company is one of the few explorers and miners that is significantly undervalued even at current gold prices and does not need a large rise in the gold price to justify an increase in its share price.
As investors can see, even though the Brucejack project is fairly large, it is not the largest project in terms of gold reserves; with other explorers having larger potential deposits such as International Tower Hill's (THM) Livengood project (almost 10 million gold ounces) and Chesapeake Gold's (CHPGF.PK) Metates project (18 million ounces of gold reserves). But the true value of Brucejack lies in its high-grade characteristics, which makes it much cheaper to actually mine the gold - grade almost always trumps quantity when it comes to exploration companies.
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