The market has reached a maniac state! TSO's EV right now is around 90 Mil. CRO after the CR is 2.6x our EV!! I know its a growth stock with great potential but looking at last quarter revenue of $300k AUD, which is equal to a gold miner selling only 130 ounces of gold (at gold price of US$1800 or $2300 AUD). Surely CRO still has a lot of work to do to justify its valuation.
We already know that TSO is having a clear pathway to become a 100k ounces per annual gold producer. Pac partner said we are on the way to define 2Moz at Ternera. Therefore the mine life would be at least 20 years with further upside potential. El Zorro has plenty of other undrilled targets, needless to mention that we are a dominant player in a new gold belt with >540km2 land mass. Zeff has mentioned many times that we would accelerate the project as fast as possible and IMO 3 years would be a realistic target for our first gold pour. If TSO starts to produce 100koz/pa in 3 years, CRO would need to archive a consistant growth rate of above 80% each quarter to reach a revenue of 230 Mil.
It looks like gold is heading back to 1800. If you remember the last time Gold dropped below 1800 in late November then bounced back in early December, TSO had rallied to 34c! So why it has now lost 40% in value and is currently sitting at 20.5c, even when the POG is at the same level??? Let's have a quick look at what happened since then:
10/12: Large surface defined by trenching at Toro Gordo 23.00m @ 2.16g/t Au, 40.00m @ 1.23g/t Au, 18.00m @ 1.23g/t Au and grades up to 42.70g/t Au.
16/12: Broad zone of mineralisation extending the Ternera mineralised zone approximately 150m to the north east.
22/12: Massive 300g/m Drill Intercept Confirms Large Scale Potential at El Zorro 267.00m @ 1.12g/t Au. Confirms the development of a new continuous wide zone of gold mineralisation over 600m of strike north to south, along the eastern flank of the Ternera Deposit.
11/1: Drilling continues to expand the scale and higher-grade zones at El Zorro: 220.00m @ 0.86g/t Au including 39.00m @ 2.73g/t Au and 15.50m @ 5.49g/t Au.
Hole 75 confirming the continuity and scale of a new gold zone and extensions to the north east of Ternera. 73 returned further extends the Ternera mineralisation to the south/southeast by 60m. Hole 71, 74 intercepted strong zones of previously unknown gold mineralisation on the southern margins of the deposit. Now we also add 2 more rigs and have a total of 4rigs drilling 24/7.
13/1: SPP heavily oversubscribed at 27c.
22/1: Ken Hall, a guy with 30 years in the mining industry and is also our 2nd biggest holder, purchased $2Mil worth of shares on market at 27c.
27/1: hole 67 is the 13th holes returned >100g/m. Several holes returned wide zones of near surface gold mineralisation confirming the continuity of gold mineralisation from 5m to over 400m depth.
Hole 72 successfully intercepted a deep mineralised structure and extends the Ternera deposit a further 50m to the south.
Hole 77 extend Ternera 55m to the north-northwest.
19/2:Step Out drilling extends Ternera 200m to the South. High grade results confirm potential to the east of Ternera with another 100g/m intercept. A total of 32 more holes were drilled since first week of December.
As we have observed from above, the reason for SP falling from 34c, with the same gold price, is due to a series of horrible announcements. During the last 3 months, we have failed to archive any further high grade 100g/m holes, has reduced the number of drill rigs onsite and drill rate has been slowed down significantly. Also the size of mineralized area has been reduced massively after each announcement. Most dangerously, the company is now in debt with around negative $21M cash and having no idea about what to do next or where it's heading... oh wait.. either me or Mr Market is so confused right now.. More than happy to buy more at these crazy prices..
TSO Price at posting:
20.5¢ Sentiment: Buy Disclosure: Held
More than happy to buy more at these crazy prices..
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