Been thinking about the share price of NAP, aside from kidding Sleeper about it just going up and up. The demand-supply situation for Palladium looks very good. My view is that the Lac des Iles geological resource is quite valuable, and it is being cheaply open-pit mined in one of the most mining friendly and politically secure areas of the world.
As those who follow this stock know, it is relatively thinly traded and volatile. I think it reached over $C 9.50 in 1990. The monthly historical chart for PDL in TD Greenline
fast.quote.com
shows another peak at well over C$ 11.00 in late 1994.
Preacher on Kitco has followed NAP and he and Claude Cormier have commented on valuation of North American Palladium's Lac des Iles operation:
Preacher thought that it is "worth C$16 per share, even with the big debt." kitcomm.com
Preacher gave a thumbnail valuation as follows:
An open-pit deposit with 4.0 million ounces of Pd and with Pt, Au, Cu, Ni and Co credits, the equivalent of much more than 4 million ounces of palladium, "but let's just call it 4.0 M/O Pd." At a Pd price [then] of US$400 per ounce, he valued the Pd in the ground at $70 per ounce. "4 mill times $70 equals $280 million. There are 13 million shares out [and] also $80 million in debt. So let's value the deposit at $160 mill. So that's $160 mill divided by 13 mill, which equals US$12.30. Actually, that's about C$18.00 ..." exclusive of the various credits.
kitcomm.com
Claude Cormier compared the silver junior BAY with PDL, and felt both had similiar potential but that higher palladium prices will give the edge to PDL in the coming few years. "Although the PGE/Copper/nickel resource of PDL is much larger ( 5-6X ) than BAY's silver resource, PDL market cap is already 2X Bay's and it doesn't have a clean balance sheet like BAY." Both are on course for a 15,000 ton/year open pit mining operation. "PDL material is worth some $30 per ton while BAY material is worth $12. So the CAPEX, operating costs and current balance sheet will make the difference. I like both...."
kitcomm.com
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