gold/nickel minnow named after a horse

Ramelius (RMS) reported some of the best grades seen in Australia in 2005, yet the shares now find themselves at 11.5c. One very lucky broker and his clients managed to pick off the best part of 2m shares at 10c from a junior resource fund around two weeks prior to the results being released. Upon the news of the gold grades being released (4m @ 151 g/t, 10m @ 66 g/t) the shares rallied to 17.5c and the lucky broker did what anyone else would do and filled in the rampant buyers. In this market you tend to take a 55%-70% win in such a short period.

Looking at the stock, how the company is run and the potential you would think that with a new base forming there is now some potential upside on the horizon. With a market cap of only $5m the company is barely trading above shell value which my broker believes to be $2.5m-$3m. Decent shells with tight structures should be able to attract these multiples for starters.

Wattle Dam is potentially the company's first source of cash flow and depsite being a very small gold deposit it is close to the surface and would be easily digested by a nearby hungry mill. For a major gold company a project such as this would be deemed non-core, however for RMS with such a small mkt cap it could lead to "self sufficient exploration.

The Hilditch Nickel Project has created some interest from some decent hits and the real kicker from this project could be a JV so that sufficient funding can be allocated towards it. The projects development has been slow, however with limited cash RMS have been rather selective with their expenditure and adding the most value for as little outlay as possible.

The other gold project is within close proximity to AAR's high-grade dirt and in the right environment some bonanza hits would be expected to create some interest in RMS.

Management like to keep expenditure down (office at Midland instead of Perth City) and the MD likes to get his hands dirty as often as possible. The company also reduced the exercise price of their options when the shares were diluted and handed shareholders a spec of gold at their AGM. Pleasing to see a mining junior that likes to consider its shareholders.

Ramelius was the horse in Germany that legend has it went for a leak, scratched himself and came up finding a major zinc-lead mine. There is no arguement that RMS's major project with the cash flow potential is only small but it may just be able to keep them from going back to the market when speculators are again excited by the lure of a high-grade discovery.