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Strategies & Market Trends : Ride the Tiger with CD -- Ignore unavailable to you. Want to Upgrade?

To: Frankly Speaking who wrote (6087)	3/24/2004 12:03:07 AM
From: bmccra	Read Replies (1) \| Respond to of 313662

Sorry F.S. but I don't have a specific price target. I just like what the stock has going for it and I'm very comfortable with management also. I'm quite happy that the stock was able to sneak out to a token new high today so we'll have to see if it's going to keep moving higher or whether it has yet another trip down near $2 coming, but I will use any returns to lower prices to keep building my position. But as some general guide for valuation there is an order of magnitude study in the historical news releases on the Metallica website. I like to refer to it, and the link is included in post #21920 on the Precious and Base Metal Investing Thread. At the time of that press release Metallica only had 28.5m shares out compared to the current 81.8m, but at that time according to that study the El Morro copper-gold project had a per share Net Present Value (10% discount) of $7.30 USD based on what were then optimistic commodity prices of $1.25 copper and $325 gold. And that gives no value to Cerro San Pedro which is now wholly owned and royalty free, and is expected to be producing an average of 90,500 ounces of gold and 2.1m ounces of silver annually (commercial production scheduled for Q4 2004). According to a February 2004 press release the NPV (5% discount) for Cerro San Pedro based on $375 gold and $5.66 silver is $56.5m, or $81.6m based on $425 gold and $6.54 silver. There is also cash on hand to be factored in, plus the $10m USD payment due from Noranda in later 2005. In any case I believe Metallica will be seeing higher levels, if not sooner then certainly once it joins the ranks of producers. To me the stock offers nice exposure to gold, silver and copper and that's why it's one of my favourites for the longterm. Sorry I didn't really give you an answer to your question, but hope that does help some. b