I have been buying HGO for some time and still see a lot of value based on my research and interpretation of the fundamentals.
Based on the current forecast for 2019 and the date for completion of processing the stockpiles, its possible to calculate the forecast cash flow from the open cut mine plan. If they limit capex to $5m and achieve the forecasts, and don't have to close shop and pay a heap of redundancies, my calculation is the surplus cash that emerges will be close to the current market cap.
With mining close to finished and a lot of the production hedged there isn't a lot of risk out to completion.
The things that bag this up in the short term are, the tax losses, the franking credits, the PHES, the possibility of mining close to the plant continuing and all the potential near plant resources at a time when copper is very bullish.
The regional exploration licences add a bit more meat to the sandwich.
Its always a gamble but how often can you place your bet when a horse on decent odds is way ahead in the straight a few lengths from the finishing line.
The PHES announcement and the quarterly report could hit the screens any day.
HGO Price at posting:
8.4¢ Sentiment: Hold Disclosure: Held
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