OK... lets do the numbers again..
Assumptions
1. The property we are discussing is the Excelsior Mine.
2. We can recover 80% of the avalable gold and silver.
3. Production cost of $250/oz (including the environmental set aside).
4. A standard gold stock pricing multiple of 1.8-4.0 X EPS are in play.
Data Assumptions
12.1 million ounces of silver @ $12/oz. equals $145,200,000.
195k ounces of gold @ $650/oz. equals $126,750,000.
Gold equivalent oz
$145,200,000 / $650 = 223,385 oz
Gold + gold equivalent
195,000 + 223,385 = 418,385 oz
Recoverable amount = 80%
418,385 x .80 = 334,708 oz
Total valuation
334,708 x $650 = $217,560,200.00
Production cost
(195,000 x .8) x $250 = $39,000,000.00
Net revenue in ground
$217,560,200.00 - $39,000,000.00 = $178,560,200.00
EPS
$178,560,200.00 / 325,000,000 shares = $0.549
Gold/Silver multiple Net Valuation
Low: $0.549 x 1.8 = $0.99 per share
High: $0.549 x 4.0 = $2.20 per share
Current price valuation multiple range
Low: $0.99 / $0.009 = 110 times current price
High: $2.20 / $0.009 = 244 time current price
any way we cook this... it doesn't look bad.
rrm |
