Thanks for the replies. I'll continue to play devil's advocate for the moment in the hope of eliciting further rebuttals that will improve our collective understanding of FML's prospects.
1. With respect, I don't think you've argued convincingly that the large number of shares on issue doesn't matter. I've already offered two reasons why the large number of shares could be off-putting to potential investors. I could add that potential investors, seeing the lavish history of issuance, might be afraid of further dilution. In addition, some could be afraid that the "penny-dreadful" share-price level (as resulting from dilution) will keep FML as a traders' plaything, and thus frustratingly volatile. The dilution has meant that, at 5c, FML's price is kinda weird for a respectable producer. I'm not suggesting that FML will never be forgiven, or that the matter can't be fixed with, say, a share consolidation. But a return to full levels of investor commitment may depend on seeing some serious profitability first, to break the ice. Maybe that's how we've got in at cheap prices - and why we have to keep waiting.
2. I simply don't know if we are at risk of an unheralded near-term capital raising for any unfunded work. Does anyone have a sense of the adequacy of FML's budget for things like infill drilling? Step-outs? Exploration? New mines? New tenements? Plant? Likewise, is there anyone who sees any under-estimates, or foresees any specific cost-overruns? Investors may indeed just be generally wary of risk. However, FML has a history of passing the hat, and it pays to be wary.
3. I know of a respected analyst who recently assumed a twenty per cent conversion rate from resources to reserves when costing FML's share price. Having thereby established a two-bagger projection, he still didn't buy, because of perceived risks associated with the three points that I outlined previously and have re-discussed here.
Please note that I'm focussing on FML's potential weaknesses here, and not mentioning its good points. I hold FML.
FML Price at posting:
4.9¢ Sentiment: None Disclosure: Held
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