Well, well, well my fellow STB holders hasnt she copped a hammering of late!!!
You would have to think Sprott would be fuming a bit a after buying in at $2, seeing a fast rise to $6 and then back down to $1.50!!. No doubt they are getting the same response as i did "at STB everything is fine and we have no problems with the Eritrean Govt".
To be honest i have been quite stressed out watching this rapid fall but i guess i have now put things into perspective. Reading todays posts on sanctions and mining in Eritrea has helped alleviate some of this stress. I am not discrediting/ignoring the soverign risk at play here but i believe this asset is now to big to fail and the Eritrean Govt will realise this and make it a priority in making it happen to help better the country.......
STB now has a maret cap of a $140 million compared to ELMs $240 million, thats a $100 mill difference!! I sure know which one i would prefer- an open cut mine as opposed to solution mining.
Yes this is a risky investment but if you had a look at todays share price it looks like the punters are backing it to fail. It is now trading at 25% of the value it was earlier on in the year. I think the whole risk exposure has been overbaked and things in Eritrea are not as dire as some negative posters have been harping on about.
During the GFC IGO went from $8 down To $1 and then back upto $8, GCL went from $11 or $12 down to the low $3s and then back up. These scenarios give me hope.
Assuming world markets stabilise in time and the political situation in Eritrea is clarified (hopefully within the next 12 months) STB should start to consolidate and trend upwards. I honestly believe STB will go into production in 2016 or sooner or potentially get taken over. You would have to think if STBs asset is that good the big boys would be having a good look at it while it is around these levels.
STB is no longer a quick trade as it once was. I am punting that we will get back to the all time highs in the coming years. This has now become a 5 yr play for me. Sometimes the sharemarket can be very wrong and does not reward true value!! Only time will tell i guess......
Thoughts?
Cheers Fursty
STB Price at posting:
$1.54 Sentiment: Buy Disclosure: Held
