"What fundamentals??? There aren't any until it's in production or close to production. The best way to analyse a stock fundamentally is through it's cash flow/deb't ratio, P/E ratio etc. EXT isn't at that stage as yet."
Hey Champ
DCF is fundamental analysis and can still be used before, during and after feasibility studies - of course the level of certainty increases as time goes by and more drilling is completed, JORC reserves are firmed up and the DFS completed.
What do think will be in the BFS and what do you think financiers will look at before they commit funds - they review DCF analysis forecasts. If you simply wait for figures to hit the P&L statement you are too late and have missed the boat - a bit like driving using the rear vision mirror.
The best profits are made by running some DCF numbers early on before the charts reflect the potential fundamental value - EXT is a prime example of this with still no DFS completed and yet EXT has a $1.7b market cap, is in the ASX200 and currently #115 by market cap). Not bad for no fundamentals eh Champ. What are your DCF projections?
Even if P&L, cash flow and balance sheet figures were available - a prudent investor would still use forecasts and projections to see if the future DCF analysis shows the NPV is above the current market cap or EV. Risk is still involved trying to get the projections right.
EXT Price at posting:
$7.05 Sentiment: LT Buy Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)