So we are idiots to shun stocks with PE ratios of +35. I don't care what some stupid hedge funds do with short/long positions, in the end an investment is all about its potential to return value in comparison to its present value.
We have noted what you've said "B4".
You have said it a thousand times at nauseam.
NST and the US markets are just bad investments as they have no chance of returning their value in the next 20 years, full stop...... and their dividend returns are uncompetitive when compared to much much less risky investments. End of argument, same goes for US markets whose only direction can be down while they yield less than government guaranteed instruments. Market can only stay irrational for so long. Once the growth meme dies, the yield meme starts to come into play. That's what we will see going forward.
If you want to trade in exuberant momentum in overvalued markets and stocks well there is nothing stopping anyone doing that. Bitcoin is a classic recent example. Everyone please go right ahead. There are always idiots who buy the top and that's why some people get very rich because there is always a smart seller on the other side.
On current profitability NST would need to trade for 35 years to attain its present EV. With reserves of less than 5 million ozs and a production profile of 850koz/annum its only got 5.6 years of reserves and there is no way that the company will replace 850koz of reserves each year through resource conversion and remain profitable enough to make ever make its value back. The company is actually a train wreck based on its present valuation. The only thing that saves it is a rising gold price and boy have they got lucky there just at the right time with their group Dec quarter AISC being higher than RSG's while RSG is deep into a development and ramp up.
I'm not going to put my money on a stock under the false premise that it will either go up or down based on the whim of some greenhorn's bright idea about a long/short trade pair. Company valuations are about a company's ability to generate future cashflow and profits and the comparison of that ability against its present value. The rest is irrelevant nonsense that just gets smoothed out over time. If you think a company will never make its present EV value in profits over time don't invest in it, it doesn't make sense to do that. If you think a company can exceed its present EV in future profits invested in it.
The reason RSG is range trading is purely and simply because it's in a deep developmemt phase and in a ramp up period on its most significant and critical asset. People are uncertain of the story and some people can't comprehend how good this mine might become, they just see it as any other gold mine. They can't join the dots or comprehend its potential relative to other mines in the market place.
Someone wants to discuss and compare AQG to RSG and there are a lot of people coming here to irritate RSG holders with how good the AQG story is. Well I've followed the the AQG story for a very long time and I can tell you that the company built up a great kitty of something like US$600 million in cash mining the oxide story at Copler but to turn that story into a sulphide stroy they have turned that US$600 million into a net debt of US$245 million. At the same time AQG's current EV in CAD$ is equal to the Copler sulphides projects NPV at the US$1,300 gold. Why would you invest in a project which is fully valued already after only about 20koz have been processed and it is still risky as it hasn't achieved commercial production yet? You are paying full value at day one and it hasn't even be derisked. The answer is because markets are irrational and will probably want to trade more ridiculously overvalued momentum stories on ridiculously overvalued stocks like NST where stock just gets palmed off to superannuation funds where the fund managers make very tidy salaries and don't care whether retirees starve or not in retirement. They just like making cosy deals for themselves like the rest of the corrupt markets or they just want to sell more units in derivative products like ETF funds to rake in fees like the fleas they actually are, sucking the blood from all sorts of industrious people who actually do things, build and operate assets in the real world. The US banksters just sit back and dream up more useless derivative investment products that serve no direct purpose other than to dumb it down for investors and herd them into products where they end up being the ultimate gate keepers when the sh*t hits the fan.
Also the other thing is Copler is targeting 1.7Mt/annum sulphide capacity whereas Syama is targeting 2.4Mt/annum with scalability to 4Mt/annum. Once Copler works its way through it's high grade stockpiles, where cashflows are expected to be highest in the first few years its production will drop off with grade and Syama will exceed Copler's production in long term steady state production as it will have a steady grade andy mining rate with much more potential for future scaling. Syama is just a better mine. Esh
(20min delay)
