You'll have to refer me to the section of The Intelligent...

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robbo24

11,339 Posts.

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04/12/16

15:58

Post #: 21091706
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Originally posted by BK47 ↑

I believe a discounted/adjusted NTA that reflects liquidation value is one way to calculate the potential downside of some investments... I also believe it is a "legitimate valuation method" and Warren Buffett, Benjamin Graham, Schloss and others agree with me on that one!

If the Market Cap of NTL dropped to $3M and liquidation is $6M.. Your downside is limited and you would have exposure to a potential large upside if a deal is struck or mining begins... If you don't believe it's possible have a look at MGX.ASX it had $450M of term deposits with bugger all liabilities, was amazingly making money and still had a market cap in the $200M range up until very recently... Investing in these situations is how Buffett made his early fortune (cigar butt NET NETs)...

I agree that NPV is more appropriate than P/E with respect to miners but this needs to be discounted or viewed with the risk of the project not proceeding or projections changing (costs rising, gold price and currency risks)...

In regards to the new Directors I simply asked if people believe they will purchase shares and that they currently have none..

There are many stocks that trade on NTA as the basis of their valuation... All listed investment and property funds for example

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You'll have to refer me to the section of The Intelligent Investor or other related publications by the big names where they say they are interested in speculative stocks that do not produce revenue...

NTL Price at posting: 0.6¢ Sentiment: Buy Disclosure: Held
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You'll have to refer me to the section of The Intelligent...

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