In the last month MML has gone from about A$0.37 to A$0.54.
So a A$0.17 increase.
Yet in the FY15AR the company's own commentary on last year's impairment defined how they calculate the carrying value of the current assets:
- US $100 per ounce change in gold price = $54,200,000
Ie a $100 move in the gold price affects the carrying value of the mine at a rate of US$54M!
And from Jan 14th this year the gold price has increased from $1073 to $1233 at the moment - ie US$160.
Therefore the value of the mine in its existing state has increased US$86.7M which is roughly A$122M which is A$0.58 increase in book value per share in the last month alone!
...yet the share price has only increased A$0.17?!?
And...
That's ignoring any potential increase in reserves as a result of the higher PoG.
That's ignoring any obvious potential MML has to expand its operations to new deposits.
That's ignoring lower running cost from the PHP falling 5% this year!
That's ignoring lower operating cost for energy with oil now below $27 a barrel.
I hate that I'm sounding like I'm trying to ramp this stock - but I just can't fathom a reason why any MML shareholder would sell a single share tomorrow anywhere near these prices...
MML Price at posting:
54.0¢ Sentiment: Sell Disclosure: Held
