With a blue chip stock, I would expect that spinning off some
properties would result in the price falling by the equivalent
of the valuation of the properties spun off. Therefore, with a
a company like TRP when they separated off a company, the price
dropped by around six dollars. That didn't matter to the shareholders
because the stock they got was worth that amount. With WSP at
the moment what would you estimate outof 3.80 is the value placed
on WSP's other properties? Given that before the results at Snap
Lake the price fell as low as 38 cents if I remember correctly
the value of the other properties shouldn't be any higher than that.
These properties, although they've had some work done on them,
are pure speculative plays. If I'm right, then the new company
should trade as a penny spec with some extra value, perhaps,
because of Hilltop and maybe the Tyler properties but nothing
is proven there. I don't see them as any more prospective than
GGL, for example. The first thing the company will have to do is
raise money. I don't know if they'll do that through a PP and then
commence drilling and exploring. If that happens, the placees will
be an indication of what value they are putting on the properties.
If insiders take the PP we an expect that their information is that good results can be expected. However, there'sneer any guarantee.
The fact that one poster has reported that there is an inactive
drill at HIlltop makes me believe that they will do nothing until
the new company is in place, then with a financing arranged, will
want to begin work immediately. There'll be an interesting gap
there. In my experience unless there is some significant news
immediately after a PP, the stock price falls by about a third
so that it is possible to buy at market below the PP price.
(RMLL has just announced a 2 million dollar financing at 20 cents.
The stock was trading today at 9 and 10. PUG in its hey day was always a good buy if you waied for about a week after a financing. The
stock dropped back, then over a period of a month or six weeks
ran back up.)
Still, with all the secrecy, it is like trying to read entrails.
|
