Alliance Resources Limited - AGS
I keep my eye out for stocks that appear to be undervalued with how much cash they have compared to the state of their operations. AGS falls squarely within that category.
Basic sums - MCAP & EV
The last quarterly for AGS said the company had
$8,148m cash.
The company currently has an
MCAP of $11,472,332 @ 11 cents.
This gives the company an
Enterprise Value of $3.288m.
Basic sum - Shares on issue
The company has on issue a puny 104,293,923 shares.
In the 2017 annual report dated 28 September 2017, the Top 20 held 61,184,756 of the shares on issue. That's 58.67%.
If we take the Top 20 out of the equation, that leaves only 43,109,167 shares for the every day guy on the street.
Most people on HotCopper and other stockmarket sites would happily swallow 1,000,000 shares in a small cap explorer like this one.
Who will be the lucky 43 people to own the remaining shares in this company?
Recent price performance
I refer to this
helpful post by
@gamefisherman which includes a helpful chart. More on charts later (they look good but it's getting late at night albeit I wonder if we can see higher highs).
What does the EV of $3.288m buy you?
This is where AGS gets really interesting. Currently the market is valuing at $3.288m the following projects:
Wilcherry Project including the Weednanna prospect - a 61.36% interest in tenements covering known gold, copper, tin, silver, tungsten, zinc, lead and iron deposits.
Drilling results announced today include
bonzanza grades up to an ounce per ton. The exploration appears to be going very well. High grade gold results ahoy.
Napean South Nickel-Gold Project (Western Australia) - 100% interest held by AGS, and nickel and nickel companies are getting popular again because of:
Gundockerta South Nickel-Gold Project (Western Australia) - 100% interest held by AGS, as above.
Also base metals, tungsten and more gold at
New South Wales.
But wait - there's more value for your $3.288m
AGS also owns:
Centennial Mining Limited (ASX : CTL) – 11,000,000 ordinary shares
(currently worth $132,000)
SciDev Ltd (ASX : SDV) (formerly Intec Ltd) – 954,264 ordinary shares
(currently worth $10,500)
Tyranna Resources Limited (ASX : TYX) – 71,393,843 ordinary shares
(currently worth $1,499,270)
So we can
add another $1,641,770 worth of stocks to what your $3.288m buys you.
Comparisons with other stocks?
One stock that came to mind in terms of stage and grades is EXU. EXU has an MCAP of $51m and $3.3m cash. EXU has some good grades, but, overall, not as good as AGS. The main difference seems to be that EXU has advanced to the stage of a maiden inferred JORC resource
and the company advertises on HotCopper.
What's the upshot?
I look at AGS and I see that the front page has posts dating all the way back to April 2017 - the market seems to have forgotten about this one.
Perhaps time to dust this one off, looks to me like it's egregiously undervalued and
may be noticed some time soon.
