wilson's assumptions - are they valid?, page-2

Hi Yaq, what you say is true, these reports are often not worth the paper they were written on because of some serious conflicts of interest. This is the case here.

However what you have to remember is that you can't take these type of reports at face value, so to get any use out of them you have to edit some of the assumptions to get a more appropriate outlook that fits within your opinion of the future.

I have run through my own conservative figures and come up with a value of kanmantoo of around 21c a share. Valuing only that project, and using a discount rate of 15% p.a. My estimite is conservative so I know their is alot of upside, clearly if I were to put the most aggressive forecasts I could in their SP would come out alot higher.

Overall the point I am trying to make, is that we can edit these reports and essentially do them ourselves, and from doing so, going by my own figures, I am happy holding HGO at these prices, as I am an optomist about world commodity prices, and believe that although in the short term they could be hit, the growth in China, and a resolution to Europe will be reached and prices will be strong. So the Wilsons report still holds some validity, but really the assumptions should be scaled back, such as that copper price, and you get a better result. The good news is the result I get with great confidence is still higher than the current SP so their is still strong upside potential.