Questions, questions. This company is an enigma to me. Looks terriffic, and looks undervalued by 10 times?, even 20 times?.
I can offer the view that exploration companies tend to drift when no news is expected. Impatience, chart painting, can lead to big falls that are not warranted by the fundamentals.
News to look forward to is the new Resource at Karmagtai. This has been projected (in this preso) to be in Q4 2021. That means any day now!
Have there been enough good drills to boost the resource? Last resource was 31 Oct 2018! Since then we have the new deposit at Stockwork Hill. There have been 5 good drill announcements this year on Stockwork Hill! So this looks good, but is it enough to bull the price?
The other big news would be a partner to develop Karmagtai.(also noted in this preso). The scoping study points to $A600m of capital needed. No hope for little Xanadu to raise that. A 50% JV with a big operator (this is what Gold Road did with Goldfields, and look how well that worked out) could raise the cash and manage development. If they're watching and waiting, they'll be waiting for the Resource update.
So step 1: resource update , up towards 1 Bt step 2: JV partner.
So buying now is a bet that both of the above will happen, IMO. If they do there should be a good reward.
XAM Price at posting:
2.6¢ Sentiment: Hold Disclosure: Held
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