Just for people's interest. We are currently seeing valuations of about 1.28% leverage. We are sitting at .6%! That means an easy double is where we should be sitting. Also, no one should be surprised that our gold fetches $29 an ounce instead of $50-$100 because we are not a producer. Converting the deposit to Gold Eq fetches us a value of $9.50 because of the longer term risk. Returning to leverages. Nova Gold is sitting at about 1.9%. That's 3 times what our leverage is. If we got anywhere near that we'd be over $3.40. Looking at a few buyouts and taking the same approach gives us some attractive numbers especially when you add the $1 Teck owes us. Then assign so more change for the Mira lands and the 40 cents premium I expect from the Discovery zone. My $7.87 is still realistic. I only tempor this with the idea that we grew too big. At a certain size the extra pounds are wasted. This is why Teck said they had enough data as indicated in our shift to the endgame and value added.
Gold Spread: US$75.04 was the average market capitalization per ounce of gold equivalent for the gold mining companies on 2012-Jul-23. The average ore value per tonne was US$52.29 per tonne.
Here's a list with clickable links. You can drill down on a company and find out what it's leverage is. They also give you a projected potential. There are explorers out there who are sitting better than us and I think it's only time before ours shoots up. The biggest obsticle to price is undoubtedly Teck, BC regulations and Capex.
As an example from 2010 you can see that explorers were getting 1/10 of their fair market valuations in terms of their sp: http://www.goldminerpulse.com/blogs/crazyHorseValuation.php
As a further aid to understanding my thinking: http://www.altonamining.com/static/uploads/documents/Copper_Industry_Note_110706.pdf
And of course, for the hard cores who really want to understand what we do.
http://www.literaturecollection.com/a/herbert-c-hoover/principles-of-mining/1/
When you combine this small sampling of information with a robust understanding of the macro you get a better sense of where I'm coming from. Many have slagged me for what I've suggested but the problem for them is they are not doing the work. I could also provide links on understanding the macro but that get a bit blurry and requires knowledge and experience. In addition, it's not possible to nail the macro very often. We can come very close and that should suffice for our risk assessment. This should help people understand why I pushed the company for going empty handed to the AGM. Subsequent calls to the directors have helped reduce the risk level. The strategy ahead is one I approve of. For a bit it seemed like we might not have fully considered the geo risk of the new lands but I have been assured we will do just that.
