Steaming Ahead!, page-43

If you subscribe to my theory that small cap resource groups go through multiple stages:
1 - all flash no thunder, very low share price (no value)
2 - Good marketing and marginal results, share price goes way up (value extracted)
3 - Money needs to be made to explore potential, share price goes down/holds (value drops)
4 - Repeated credit raises mean a company worth $10m has 10 billion shares on issue, consolidation (value drops)
5 - Strike, discovery of great asset (value rises 20% to 50%)
6 - Financial solution for proving (value drops, but volatile in this window)
7 - Moves to extraction (value goes way up, potential 10x move here)
8 - Produces dividend (value goes way up again)
9 - Settles into it's place in the market (value comes down and settles)

Most don't make it past stage four or five but the owners/directors of the business live off the investment injections for as long as possible before the company goes under or is bought out at a fraction of it's value for one last sugar hit.

With EMR if you picked the moment that it moved from stage 5/6 into 7 you'd have bought between 0.04 and 0.5 per share and be laughing right now with it over $2. You'll be laughing even more if the financials allow for a yearly 0.08 dividend effectively buying your initial investment for you even if the share price retreats - but I don't expect it to do that.

I'm looking for a $4 to $5 share price around the time dividends start moving, potentially a special dividend at the start to get it moving and I'll make my considerations at that time on selling.