Hi 5riven, In terms of what brought it down to these levels...

Hi 5riven,

In terms of what brought it down to these levels there are quite a few factors:

- Gold price weakness
- Market expectations were very high for RRL when it ran up from 50 cents to $6 after the GFC. The company was priced for perfection and perfect execution of its growth mines at Garden Well and Rosemont. They also had an aggressive dividend policy compared to others in the sector.
- Garden Well has significantly under-performed these expectations particularly in regard to grade and recovery. Because it is a low grade operation to start with they are particularly exposed if grade comes in low.
- There was a major flooding event last year (1 in 150 years) at GW which hampered production for 4-6 months. this year it was just high rainfall rather than flooding I believe.
- The technical director of the company was forced to fall on his sword following the flood event. He was supposedly what allowed RRL to build its operations more cheaply.
- Newmont was previously touted as a potential acquirer having 20% of the stock. That was in 2011-2012 when the gold market was kicking along though. Newmont is now exiting Australia for the most part. Any particualr takeover premium gradually evaporated from the stock.

At some point all this information filters through the stock and the market expectation becomes too bearish. I believe we're at that point now.

Be careful about using outdated financials though for valuation etc. The PE is likely significantly lower than 11 under the current share price, gold price and AUD (I feel like closer to 8). Debt is now down to $20M too.