Where is the bottom?, page-21

MGX is one of my largest holdings. Always tempting to sell off a few chunks and spread the money around a bit. But it's really hard to get past just how low its valuation is. Even by the crazy-low standards of everything else at the moment. In Year 2 of KI operations, MGX plans to sell 2.6Mt of ore. At the current price of US$89/ton, plus a premium for the grade, less some shipping costs, MGX is probably netting around AU$150/ton right now.

If they were to ship the whole of Year 2's 2.6Mt production forecast at that level, that's $392M. All-in cash costs are around $176M. So that's cashflow of $216M.

Or put differently, adjusting for the cash pile, it's generating 50% of it's market cap in cash annually.

And there's a bit of treasury returns and some rail charge refunds.

You just can't sell an asset like that...