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Agreed, the main reason I'm confident enough to leave my money in here is because they've forecasted the return based on $1300. If they'd used the current spot price at the time (somewhere around $1500), I'd have been reluctant because gold is already high and is rising higher due to its safe haven status.
Eventually, that money will flow back out again to riskier asset classes and gold price will return towards the mean.
With the 200d MA just shy of $1470 and rising, and the chart setup looking like a retest of the 2011 peak around the $1900 mark at some point this year, knowing that the project is profitable enough to justify funding at the $1300 price level is reassuring.
The only risk here is project finance, which is exactly what has burned so many people on SXX. So it's understandable that many will be holding back until it's derisked.
Of course, risk is where the reward is, so I'm happy to sit on my investment and wait. When the finance risk is eliminated, I'll happily sell my shares to someone who wants a more comfortable investment... At a premium :)
Btw smacks be careful with your maths there. I haven't checked your figures, but if your numbers are correct and a $300 rise in gold would equate to $7m extra profit for KAT, the higher price would need to be sustained for an entire year to achieve it.
As in the oil industry, the spot price doesn't matter, it's the VWAP that they actualise as revenue to the company. Even if it hits $2000, for a month before pulling back, it's not safe to say KAT will make an extra $7m.
KaiSharp RE: Tomco Wed 09:12
I'm trying to pick up another half mill to round out my holding to a nice easy number. Would somebody mind dropping the price below 1.2p for me?
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Thank you, got my half mill today. Let's go back up now.
Lol, I mean no disrespect 10009504, but did you really expect this to hit the teens within a week?
LC was clear with the expected timelines - term sheet or an extension by the end of April.
Until then, we're at a fair price for speculating on finance risk.
Look at SXX as a cautionary tale. I'd rather see us establish a solid base around the 3p mark and then shoot up on good news, rather than rise up on speculation, only for people to lose the shirt of their backs if it doesn't work out.
d200, I put together some numbers in excel. 10m in profit at a p/e of 10 would justify a 54p price tag.
However, I think 10m would be the gross revenue, not the profit which is why I've included lower earnings in my table.
Even at the very bottom end of the scale, we'd be looking at 13p which is 3-4x where are today.
https://pbs.twimg.com/media/EQv-JspXkAIgHaT?format=png&name=medium
This is perhaps one of my most frustrating holds. While I'm in a paper profit right now, each day has eroded it slightly with absolute silence from the company.
On one hand, I'm tempted to take my profit and wait for news. On the other, my "trading" performance is sketchy at best and I do think that this will be at least 6-7p on positive news.
Anyone here actually have contact with the company? Perhaps you can suggest that while they have some downtime, they could work on a communications strategy.
We have:
- RNS Out
- Superb News
- Disappointing RNS
That really does sum it up quite succinctly.
On one hand, we know the JPL have a refinance based solution which should be ratified in 5 weeks. That reduces the likelihood of liquidation, which can only be seen as a positive.
On the other hand, it tells us very little as to what they're actually trying to do; refinancing can bring a lot of misery to shareholders (see PMO a couple of years ago). Add that to the 5 week delay for further news (plus a few extra days because 13th March is a Friday.... anyone here feeling superstitious?), and it does feel like the goalposts are being moved.
They're effectively saying "We're trying to refinance it, come back in 5 weeks, fingers crossed it'll be sorted by then".
So, the void of volume today is hardly a surprise, people are going to do exactly that. Go away and come back in 5 weeks.
Vauch - I don't disagree there, the only matter is one of timing; can it hit 14p before I need to reallocate my funds or not.
They could play an absolute blinder here, release fantastic news on both streams in quick succession. If that happens, 14p wouldn't surprise me, nor would 20p on hype and overreaction. But that's just a bit of late night wishful thinking.
Lee, I know how you feel. I'm actually in a pretty good position here, breakeven at 0.76 after I locked in some profits the last time we hit 6p. But someone I know has 2m shares here, with a breakeven at just over 6p. When it was at 14p, he had £250k on paper. Now it's about £100k in the red.