Instead of letting their investment grow as BTC grows they are using this climb in BTC and the liquidity it has delivered to cash out. Real shame but i'm holding on purely because I believe that BTC will go even higher. If I didn't , I would be joining them.
Thanks Splendor. In my opinion, there's absolutely the potential for a POG type move ahead. Very few wanted POG when it was in 5s and 6s because of the debt despite analysts calling the turn on the cashflows ahead. Then it began and it fast became a multi-bagger. The restructuring here was a necessity (Covid put an end to Project 22 delivering by itself) and if indeed the cashflows deliver like they're estimated then anyone using this spell to accumulate will do very well indeed.
and for context that's a growing ebitda, they are estimating $257.4m ebitda in years after hence the near 1x multiple! On cash and equivalents they reckon $259m by 2022 end. Anyway, i reckon you will see those price targets ahead Splendor!
Peel Hunt have them down for $154m ebitda in FY21, a very sizeable sum when compared to the market cap of £150m. As that ebitda drops to cash and net debt tumbles fast the EV/Ebitda multiple will look absurd. That's why ev/ebitda drops closer to 2x and then just above 1x by 2023. This has major upside from these levels.
RE: Best dividend in O&G or one of them?14 Apr 2021 10:38
And just to add that of course as production hikes or builds from Q3 towards the 55k figure there's clearly going to be further scope to return cash to shareholders. This should start getting more recognised in the sp soon, i.e a move above £2 levels.
Jimbot , i'm leaving ARB as my own crypto play right now and have a very large position here.
If you like conventional mining, try Petra Diamonds. Peel Hunt just came out with a note and reckon it'll do over $300m in cash flows (i.e. net debt to net cash) by 2023. THat makes it the highest free cash yield in the whole of the mining space and I can see it multi-bagging at some point.
Best dividend in O&G or one of them?14 Apr 2021 10:31
With arrears being collected and oil demand picking up, there's seems little reason why another $25m won't be paid out later in the year. I'd say $25m at minimum as they are collecting that every month now. If so, this is on around a 8% yield, that's fantastic given that that payout should be the base-case. I trade around a lot but I've added these to my long term pot along with Petra Diamonds which reminds of GKP post the restructuring.
I suggested before that the company should use it's growing cash position to buy out the seller and in that process reduce the share capital, which could deliver longer term upside. If the ceo is citing this is cheap (which it is, that's why i've positoned) they should strongly consider this.
It will be the cash generation of course that will grab the markets attention and in this case the deleveraging. Peel are alluding that it will be rapid and that Petra has the best free cash yield in the market, in the mining space. If that plays out, this will be multiples from these levels - for starters. If additional discoveries are made that prove to be material then it's really game on. THere are no notifiable shorts here either which also confirms to me that they grasp the potential now that the restructuring is complete and global diamond production peaked a number of years back.