Been a bit of debate lately. But what can be said, is that the current SP drop is not a result of the company and its releases. But the overall market impacting on the SP in the short term, mainly from external factors.
One analysts was talking about speculative mining stocks:
"Whilst a stock that suddenly begins falling heavily when there is no bad news being reported by the company may not make much sense. External (or macro) forces will be having a very negative impact on these companies."
The statement seems to be summing up FNT rather well at the moment. The mentality of bear v bull are complete opposites and in small cap miners, it is currently a bear market, which is sad but the reality.
The dump through 10c today as a non chartists will be short term, for one simple reason. the sellers did no chase down the price. Which gives a good insight into the mentality of most holders in the company, which also indicates to me any reversal will also be quick as people hold their stock.
Despite what the current SP is doing, think about the actual physical activities the company is currently undertaking alone and with JV.
Andewa: deep drilling is now underway and yes we all hope for good long intersections. We'll know soon. The results so far haven't been off the chart but for surface to very shallow depths (Drills didn't go straight down) we have hit mostly economic grades over good lengths. What we need is deep to start to develop a volume against resource grade. The market will like this when it comes. As most short term traders have no interest massive but low grade mines, though that is what is main exploration goal is now. Each drill hole builds for the geologist the overall picture and they learn about its geology. Its sheer size and sister volcano next door has huge potential, we don't need high grades (but would love them), as .5 g/t is what is common in new massive billion dollar mines. but it takes awhile to establish such a resource.
Tassie: Much maligned to holders, but about to get a clearer picture of the overall area with the IP report. Tassie is a great asset for us and Peters believes it can ad value to the company, and that is what they are working towards. All the recent work is aimed for a economic model and therefore options available going forward, whether to mine, sell of JV...
JV: What can be said, I think four rigs now going at a good speed, plus the requirement of 5 holes needing to be drilled at the high grade gold area currently not if interest to Ok Tedi. Given the massive grades the trenching found and I can't wait as it has to be drilled by May this year.
OK Tedi are also finalizing their budget and I've heard it going to be substantial. Which is required as they have to spend $60m as part of the JV.
Esia copper, not bad first up for a blind hole. The holes after the first four will give a picture of what is underground and the drilling will be come more targeted. The question is, was it the low grade hole first up with better grades to come.
Takeover: interesting as I was reading that Newcrest made its biggest profit ever, nice...but the big boys are always looking for new opportunities. We have had a few visit to keep an eye on things. If the deeper drilling brings back economical grades I think we'll see increased interest from them. The interesting part is they approached FNT and not the other way around, and this is important in the context of the company. FNT want to develop their own resources, but if a good/great offer appears management will consider it. For the time being, nothing is on the table and the fact it hasn't been put in an announcement means is not market sensitive information. Meaning there has not been any serious conversations, simply a social swap of information.
SP: The only problem with a lower SP, besides looking sucky on my portfolio, is that raising new finances becomes more expensive in terms of dilutions. The company has more than enough money to last well into the year, which hopefully the world market improves, which lets all root for the US to build some economic momentum. The good thing of our recent expenditure is that the majority has been capital purchases, which means we are pretty much self sufficient for exploration work, with the only outgoing being consumables such as fuel, food and salaries etc. Given Peter has already informally indicated he's looking at funding options, management is prepared and a clear plan to be implemented.
If you want to be cheered up, go watch QRL for a few days..(Yes I hope a few) :)
SP is very cheap at these levels and IMHO very good buying.
FNT Price at posting:
9.6¢ Sentiment: Buy Disclosure: Held
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