Ann: Change in ASX classification to Mining Producing Entity, page-23

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DiscoDanNZ

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14/12/20

15:11

Post #: 49563525
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Originally posted by brianchu82: ↑

I think that Red 5 at the current price reflects a sensible level taking into context the Darlot mine operations being recently underwhelming. On one hand, investors will pay for future prospects but more experienced and astute investors also take a lot into account what they can see in the company's financial and operational performance in the recent quarters. The fact is that Darlot has gone backwards in cashflow generation compared to 2019. This is undisputed. While their reserves and resources have risen, this is still beneath the ground and awaits extraction at a reasonable cost.

The KotH project development has indeed gained traction and the financing is in place. That is indeed very encouraging a development made this year. While it may justify the stock price being higher on this merit, I daresay that at least the bulk of the investors of RED stocks (not restricted to Hotcopper posters) are more rooted on what they can see. They do not seem particularly excited to pay more for the stocks. We can say what we like about whether they have it right or wrong, but in the last 18 months I have written my valuation reports on this company, I have been able to capture the actual price range. Trading on that range, I have been happy about my returns and it has made a tidy profit than if I merely hope for the price to skyrocket and yet it has not been realised.

Will 2021 bode a good year for RED in terms of the stock price? I can say that it really is rooted more on the Darlot mine for the first 8 months and if Siana is allowed to restart or be sold (I recall at the 2019 Gold and Alternative Investments Conference when I talked with the director about Siana he indicated they have a couple of offers - well, we now know how those negotiations have gone...). So I still stand by the equity analysts that many quote here about the prices of 50c and well above that have gone way ahead of themselves. I rather they be right than me the next 8 months, but the last 18, I think I hit the mark and they did not.

Cheers,
Brian

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Thanks for the analysis.

IMO the current SP levels are about right, for me anything under 25c on RED is a good buy if you are looking to accumulate for a long term hold (like I am). I really don't see SP moving a great deal anytime soon unless they sell Siana or some really good news comes out of the blue but I can't see anything on the horizon.

RED Price at posting: 25.0¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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Last 33.0¢		Change -0.005(1.49%)		Mkt cap ! $2.244B

Open	High	Low	Value	Volume
33.0¢	33.5¢	32.5¢	$5.433M	16.50M

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No.	Vol.	Price($)
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Price($)	Vol.	No.
0.330	82392	4
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Ann: Change in ASX classification to Mining Producing Entity, page-23

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Ann: Change in ASX classification to Mining Producing Entity, page-23

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