i still think that for now the share price valuation will be based on 5000T of nickel production.
When the market gets confirmation that an upgrade is definately at hand (obviously this will be announced in one of the future quarterlys) then that is the point where there will be an upgrade
currently theyre not even in production, so the price will definately be based on 5000T production for now.
Once theyre officially in production and release a quarterly that says all is well, then the market will look to value them based on 5000T+.
I invested in SMY a couple of yrs back and it was a SLOW process for the market to realise its value. it always traded at a sub 5 P/E!
Look at PEM - dido. Traded for aaaaaaaaaages on a prospective P/E of 3 until market woke up to it, and is still trading at a lowish P/E for a company that has zillions in the bank and making 80cents per share EPS.
CBH - another diversified miner lead/zinc/silver and also gold soon - trading on PE of about 5
Use your logic and be OBJECTIVE - AGM is no different to SMY, PEM , CBH etc
it will not trade on a P/E prospective of more than 5 as long as its in its initial stages of production and as long as its a single commodity single mine company
YES it may go above 5 to say 6 or 7 over time ala SMY or MCR or IGO or PEM, but IT WILL TAKE TIME!
Even if they come good on exploration and extend resource dramatically up - look at OXR which has MONSTER resources and is very diversified across everything other than nickel and youll see that even OXR is trading on prospective 8 or so with leewat to 10.
AGM is a looooooooooooooooooooong way off OXR
Even JBM - they made 84cents or so; thus theyll make 160cents-170cents per share, which puts em on prospective P/E of less than 10 now.
AGM will DEFINATELY get there, but it will simply take time.
If PON goes up like crazy (which it probably will by mid-yr when the icy waters in russia prevent supply), then obviously AGM like all nickel miners will go up!
PON will be the major short-term driver of EPS forecasts! PE multiple applied to the EPS forecasts (based on PON) will still be only 5 max for now; production based on 5000 tonnes for now.
it takes time , but eventually ala SMY and MCR and PEM - the market will give it its due in full!
Im in.
AGM Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
