my opinions,
1. I agree
2. From what I understand, this time is being used for vacations (which means salaries are still being paid), and mine improvements. Given the cash drain, I am not sure what the net effect of these costs vs. continuing to produce zinc at a loss is. Neither is good for 3rd qtr results IMO.
3. IMO, the issue is that the balance sheet is not what it was, now that so much money has been spent on mine improvements such as Caribou which might not be profitable. Other than that, I don't understand the current stock valuation either.
4. I doubt that institutions are interested in much of anything related to resources about now. The price chart looks so bad that I think everyone is on the sidelines waiting for a bottom to form. The other problem is that an institution would be looking for a lot of shares at this price to make a worthwhile investment. I think that they may have difficulty finding a seller of a large block.
5. Actually, it CAN go to zero. I don't mind volatility, but i am worried about negative cash flow and the company running out of money.
John Templeton is known to say "The greatest buying opportunity exists at the point of maximum pessimism." I'm thinking we are almost there...
You know, I have to believe that the company looks pretty attractive from a takeover perspective. They have 5 great mines, and a tremendous investment in Caribou. The current market cap of the company is $60M US, pocket change to a well capitalized US mining company. Understanding the cyclical nature of resources, and that Asia WILL recover eventually, seems like a good time to bottom fish. But what do I know. |
