Leo,
I haven't said much here lately but I think it is time.
I like numbers (who doesn't ?) sooo lets do some simple math on the Jan 6/99 press release, bare with me OK ?
412,600 tonnes at 12.4% zinc = 51,162 tonnes of zinc
51,162 tonnes at $1000/tonne = $51,000,000 (thats 51 million)
OK of $51 million of which, lets say SAF gets 20 to 30% of that figure after all costs, expenses are accounted for,
20% = $10,000,000
30% = $15,000,000
and there are 19,000,000 shares out there. This translates to $0.54 & $0.81 per share earnings for SAF.
But SAF has to give Noranda 70%, leaving SAF with 30% of the earnings, therefore
30% of $0.54 = $0.19 for SAF
30% of $0.81 = $0.24 for SAF
but in return for Noranda getting 70% they have to give SAF $2.85 million which represents $0.15 per share.
So the $0.19 + $0.15 = $0.39 and $0.24 + $0.15 = $0.34 per share pure gravy for SAF.
Now if we apply a PE ratio of something low, say 5 SAF right now has value of between $1.70 and $1.95 per share. This calculation ignores all other properties and revenue streams SAF has, like zero valuation for all of the diamond prospects and joint venture payments.
Can someone explain to me why SAF is trading at $0.93/share ?
My thoughts, Neil |
