It was just struck me over the last few weeks as most of the goldies i follow have moved higher, that EGA is ridiculously undervalued at this point. Given the recent updates and all the drilling that is going on I've re-looked at my calculations and can see production of around 80k oz in 2020 (production could start mid-2019) at an AISC sub $1000 and CapEx sub $40mill to get up and running. Initial LOM around 4-5 years.
On top of that, there is significant upside via exploration, which is ongoing.
How can a well-managed goldie, looking at production starting in 18 months, super low capex, with 80k oz shortly after, be valued at $22mill?? EV around $19mill.
Can someone tell me what the free cash flow of 80k oz is at an AISC of $1000 at $1650 gold?
(1650 - 1000) x 80,000 = $52,000,000
Can't wait to see the DFS in April, the NPV, IRR and payback are going to be mindblowing.
What am i missing??
EGA Price at posting:
27.5¢ Sentiment: Buy Disclosure: Held
