a great day, page-31

Rowingboat, I crunched the numbers to see by how much an investment in SLR might outperform gold in a hyperinflationary world.
At 4,500 gold, that is an increase of 2.6 times the current 1730.
I currently use fairly conservative total cash costs of $830 when they produce 300,000 oz per year.
Company guidance is lower.
If I assume cash costs rise in line with gold, I get $2342.
I also assume 40% company tax on top of royalties to allow for 30% higher taxes.
My target for SLR becomes $17 for a PE of 10.
That is 4.5 times the current price for a rise of 2.6 times in the gold price.
An investment in gold is theoretically only going to protect you from inflation.
An investment in a gold producer can make you a very strong profit.

Also keep in mind that I have ignored the very high grade copper deposit that looks very likely to bring cash costs down for the Murchison.
Also at higher gold prices further expansion beyond 300,000 oz/year are inevitable.
On top of that SLR has excellent exploration upside targeting a very realistic 5-10mill oz.

So I think the outperformance I showed above would be very conservative.