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Picax. It always seems strange how billions of dollars worth of "stuff" in the ground has almost zero value. But the costs of recovery are enormous, especially now with basic costs going through the roof. This is why high grade at surface could well prove to be a massive winner for UFO.
My felling is that we will work up han**** this year to minimum 20mt indicated as that will set the bar high for any deals made
Thanks for the discussion everyone. I am aware that in-the-ground resources are valued at a staggering discount as an industry standard and that the price is depressed further by most people waiting to jump in when they hear that J/V is on the cards or drilling is starting. I guess it's quite rare that a junior with no operations is sitting on 3 projects worth literally billions each, so maybe there is an upper limit to what people are willing to assign to proven resources. Applying the discount our resources are valued at £700m which is less than half what I value Hanc0ck at alone.
I am also confused as to why we don't have a deal yet, but it might be the resources need to be expanded before we are enticing enough to JV. This is likely the case for Hanc0ck. We don't know enough about the PGMs at Munni Munni, so I can see that too. EH is the baffling one for me - the grades there are just monstrous. As people have said after the bonanza RNS, we could probably just take an excavator out ourselves. I was listening to Garrett Goggin on Stansberry Research bragging about how MAG Silver has 600 g/t resource, and that does seem to be quite high for the industry standard - just putting our 8000 g/t in perspective. Maybe it just takes more than 4 months for us to get the ball rolling there with a J/V, so that is an optimistic resolution to the conundrum on that side at least.
Haddock - This is the thing. None of us know when its going to go.
I'd rather be holding here, rather than trying to time it. That way when it does go i'll be up a couple of hundred percent while everyone else is scrambling to get in
HH
Your last two posts appear to me to be both fair and balanced. In this game you’re either early to the party and take the risk of which I’m not a versed to or you wait for momentum and more importantly sentiment. We will find whatever is in the ground of that I have no doubt. However, for the moment sentiment seems to be the driving force. It will change.
@Chrisatbirdies - Cheers - I hope you are right about a higher SP for UFO before Christmas, but as I've said before my own expectations are that we may have to wait until April 2023 before we see a change in sentiment and any meaningful move up.
That said, if I had the confidence in my own expectation I'd have taken my money out of here a while ago with a plan to return later, but trading such unpredictable and volatile shares is an easy way to miss out. Consequently I'll stand by an earlier prediction of mine that this share price will probably make its big move when we least expect it.
Happy haddock.
No need to shoot you down. You have been proved correct and we are still waiting patiently for some news that will move us up a stage. I was rather hoping bs trip to australia would bring that. Never mind, those of us that were predicting a higher s.p before xmas, still have plenty of time.
@Chris2, you really don't understand exploration. What are you taking about struggle to stay in business?
UFO have millions in the bank and are funded until next year.
The valuation reported stated "fair value 2.7p" and will be revisited during 2022.
Importantly the title of the report was:
"Alien Metals Strong progress made; more to come"
@Chris2 - the fact that a plan doesn't aim to deliver instant results doesn't mean there isn't a path toward generating revenue.
We can maybe agree to disagree about UFO struggling to stay in business, but whilst the path may be a longer slower one than some of the eternal optimists here may like, I'm of the opinion that UFO is sure footed enough to make it down that path.
@norm, it's good to use your 5% "in the ground value" for valuing projects.
We are in discussions with Hanc0ck Prospecting.
Capstone only pulled out since they drilled in the wrong place!
Now UFO have hit 78m of sulphides. If that's metal bearing it's a massive game changer and multi-bullion dollar Teck is much closer. Looking forward to the results in a couple weeks.
Also once investors realise that silver bottomed on last Friday 13th (lucky for some) the money will flow back in a flash.
I’m so pleased some of you agree with me.
This company will struggle to stay in business unless there are clear lines to a revenue stream.
Been saying for months.
Well said Haddock.. I would just like to add that that perspective is shared amongst the Miners also.. why would they risk a fortune on ground that is not yet proven, a few good drill holes do not make a resource profitable... There is much more to do than that before the majority of miners would even bother to look at you (JORC / PFS /DFS) ..
From a miners perspective the "in the ground value" tends to fall into a price bracket anyway.. just like house builders only pay a certain amount for land with planning permission on a cost per unit value.. unless you have a "freak" then most miners wont be bothered to wait until things are further along the line..
Im not saying UFO wont get to that stage, but outside of Hanc0ck its early days on the other prospects...
Also, the model Bill is alluding to i.e. "contract miners" kind of rules out some of the 3rd party deals anyway... I would prefer that we become an explorer with our own operations arm for each project... (in oz anyway) this gives us our own revenue, which we can use for drilling and exploring.
As Capstone proved on the JV, its a fickle business
@picax - no doubt this will be another case where I get shot down for de-ramping for expressing a more cautious view than this board's most vocal optimists... however...
Valuations of junior explorers are all subjective and forward looking, what matters more than any single estimate from a long list of different forecasts of what a company may be worth in the future is what the markets value it at now. Brokers valuations tend to be the most optimistic by the very nature of the fact they don't get employed to put out low valuations. As such it is always wise to assume most companies will be below their broker's valuations and "under-valued" most of the time.
Alien has great potential for the future, in my opinion much better potential than any other explorer on AIM. (hence it being my biggest holding in my equity portfolio) That said it is a tiny company that isn't yet generating any income to support a valuation plus sentiment is currently against the sector. Consequently there is not yet any perceived "rush to beat the crowds". It seems to me that folk are happy to invest elsewhere as there is still the perception that with nobody buying they'll have time to buy in to Alien closer to when things start to happen for the company and there is more certainty as to what they are then buying in to.
It's a "game of chicken" that works until it doesn't ... this is a sector characterised by companies going nowhere for ages and then making unexpected moves that can snowball even bigger without any obvious trigger.
Its just the nature of the beast that you get in early and wait, and wait and wait... or you risk grabbing the tiger by the tail when it pounces.
Picax isn't that the story with every junior under the radar they are under the radar until one day they aren't. And it flips more than a gradual acknowledgment . I defo think you can't drill the highest silver hole and not be noticed by people in the know itsnjust too early and needs followed up. If we strike good copper at Mexico you know capstone will be watching again and the DSO is small but that's because we beside literislly the gaints of mining in BHP and Rio like doesn't get any bigger . But am sure mid tier are looking
Does anyone know why this is valued so low considering the potential there is here? Does anyone know why some of the majors haven't JV'ed with or directly bought UFO? I'm not an expert so I'm looking for some opinions or directions to look in.
My main guesses at the moment are that these projects are too small fry for the big players, and that any midcaps or drillers in the region have better prospects. I am also not sure about the confidence that we have (certified) about the extent and quality of e.g. the DSO. Are there more hoops to jump through before companies come on board, such as environmental stewardship? I just don't understand what the market is seeing that I'm not.