No question ncm claims it’s resource is bigger than anyone else’s - but I still question how has this translated into profits / value for owners
Think about how many millions of ounces of gold have been produced by the leader of gold reserves - Ncm - since huge amounts of capital
Were borrowed to purchase , fund and developed all these deposits since 2010-?
What is the accumulated profit all these reserves have produced over this long period Of time ?
Investors are currently buying at a big premium over book value- for a large resource on paper that hasn’t produced much profit or income for its owners in years- whose income in the current period is forecast to drop from the last period
this imo is the risk of holding ownership at these prices -
it should also be noted business interruption is common with ncm over the years
That’s my opinion only- obviously we have different ideas as do others as they are willing to pay well over 50 times previous eps when they know in all likelyhood future eps are going to fall in the next period ( most profitable deposit is closed from creating cash) and that income from dividends which has only really just returned will / may/ should be suspended once again as cash is diverted towards rebuilding a major operation so that it can actually generate cash flow
Long term profits from all these monster reserves built over time have produced Nada really and short term we know that all these reserves are going to produce less as a major operation is closed
Time will tell- good luck
NCM Price at posting:
$19.56 Sentiment: None Disclosure: Held
