Hello Peter & Valuepro
Angola has always been a wildcard, no doubt about it. When I heard that the two previous combatants were actually sharing power, it seemed unlikely to last. However, aluvial and fluvial mining is relatively low tech and not terribly capital intensive, therefore returns can be made with relatively modest investment.
Heavy security (investment) may ultimatly be the only solution and as we have all speculated, hardrock mining simply may not be feasible.
Having said all of that, many of Angola's neighbours have a vested interest in seeing the peace maintained. Should it be threatened, they may lend their weight to the legitimate government so long as it has the support of the people.
Barrick trades over forty times earnings while DeBeers last I checked traded for about ten times earnings so I chose twenty as a mean average. Pick a number, but I agree, there is no reason for us to believe that the market will assign a higher number until a greater degree of confidence can be gained on the political stability issue.
On the other hand, should CJ decide to distribute some of the earnings as dividends, investor interest may well be kindled.
Regardless, I agree, only blue sky in politically stable countries will ultimatly push speculative interest in this stock. That is SA now, and Canada should pipes be found on the Kalahari or Kennecott ground.
Regards
P.S. The four year old caught her first pickeral on her first cast last week, and then her first Lake Trout yesterday. Keep this up and we'll be eating fish every night.
Good Night |
