A couple of thoughts on CBE... I've held the stock from 15c up...

A couple of thoughts on CBE... I've held the stock from 15c up to 70c and all the way back again. I bought my maximum SPP allocation at 15c, and I consider myself all-in on the stock. Given how the share price has performed recently, I wanted to satisfy myself that I hadn't fallen in love with a lemon. Having reviewed it, I believe that the market (and me included) has misinterpreted the silence from management, and the risk is firmly to the upside from here. Full thoughts below.

First off, let's look at what you're actually paying at the current share price. From recent releases to the ASX, I've surmised the below.
Shares on issue: 278,000,000
Unlisted options: 27,400,000 - all are out of the money; lowest exercise is 20c, highest is 33.5c
Share price: $0.09
Fully diluted market cap: $25m
Cash and equivalents: $11m
Enterprise value: $14m

The market seems to be suggesting that recent drilling hasn't found anything as we assume the management team would have reported positive news if there were visuals or decent grades from pXRF reads (because this was the approach taken previously). To check whether this approach would make sense for management, I reviewed some of the assay results against the equivalent pXRF reads. As an example, consider NCP11-B: Reported as a 78m zone of copper mineralisation, including 16m of abundant chalcocite, and pXRF results of ~20m (340-360m downhole) between 1-3% Cu (ASX ann. 30/08/22). The assays came back at ~5m at 0.6% Cu from 347-352m (ASX ann. 5/12/22).

I believe that management did what they considered to be their duty at the time when they reported the XRF results. They got burnt by this when the assay results came in very differently. Now knowing the discrepancy between pXRF and lab assays, I believe they've stopped the practice of reporting pXRF (and visuals) and will only report assay results (as Martin seems to confirm in response to the poster above). So I don't think we should assume, as the market seems to have done, that the absence of reported drill-core visuals or pXRF results means they haven't found anything.

At $14m EV, the risk-reward looks very attractive to me based on the following: 1. Economic deposits are nearby in the same geological formation. 2. The ground is prospective for similar style deposits to the economic ones nearby (confirmed by assays). 3. Two rigs are running full-time, and when assays start coming back, we should see a steady stream of news. 4. Unlike most explorers, CBE is well capitalised and won't need more money to work out if they've got something significant. 5. A big producer is ramping up next-door and has shown enough interest in the project to fund 50% of the airborne gravity survey.

And finally, the share price is now implying little to no success in the drilling campaign, which seems to me to be a misinterpretation of the silence.

For those reasons, I think the risk is firmly to the upside from here.

I'm just an enthusiastic amateur, neither geologist nor financial analyst, so please do your own research.