I initially bought NXG two years ago. I have added to my position over time and heavily increased at its recent below $3.00 point until it represents one third of all my holdings. I will continue to hold for another six months.
I have been expecting a number of events with good news to return value to the company and stockholders. The first of those events was the Q3 earnings statement. Although as many reflect the numbers may really not be bad but the market is not viewing it that way, so it can be deemed a disappointment. I might add that my investment in a mining company was to take advantage of the increase in Gold yet as Gold climbs NXG losses ground and this is not the first time.
The next event will be the release of YD reserves slated for the end of this month. It will be interesting to see if this adds value to the share price.
After that we should finally know if KN will be permitted early in 2007. One way or the other. If permits are granted it will be again interesting to see how that changes value. If not approved it will be a disaster. This addresses the three strike analogy. It is not three strikes. This alone will have a devastating impact on Northgate and its value.
I am getting ahead because there is Q4 earnings and after Q3 with the decline in output there is no reason to believe that it will be better then last quarter. This also ought to serve as a wake up call to what to expect of future quarters as output continues to decline.
An acquisition while helpful in the long term would also dilute the shares and take into consideration the drop in share value at the time the AZK offer was extended.
The company has done well with management making money for the company. I admire their sensitivity to the local community and to keep their employees working. As a fellow shareholder I feel let down in the wake of the profits this company has amassed. I may be indited as raising doubts but there are very real concerns here to be taken in account.
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