Well I can speak for most in saying I have been disappointed in...

Well I can speak for most in saying I have been disappointed in the listing. I'll give my opinion why and general thoughts for the stock moving forward.

SEED PRESSURE

Rewind 8 months when 60m shares were issued at 10c (last November) with the indication of an early March 2010 listing... Many of these seed investors may have planned to sell portions of their holding around this period and recoup their cash for whatever reason.

4 long months later and AQQ finally got to market. You can now understand that many were forced/keen to sell day one. The selling pressure was obvious and any buyer with half a brain pulled their buy orders resulting in a complete lack of liquidity to absorb the sells. It snowballed from there and the rest is history

ITS A NUMBERS GAME

With 1m JORC and an Enterprise Value of approx 7m (MC15m - 8m cash)...AQQ has an EV/JORC of a laughable $7.. What does this mean? as a buyer of AQQ is you are buying a product for $7, that we have a very good chance of selling in the future on a margin of around $600+. Of course this figure will fluctuate with the Price of Gold and there are various risks associated between now and then. But the discount the market is giving for the risks is remarkable.

This is great for the LONGTERM fundmentals but means NOTHING for the SHORTERM price. Price is a function of buyers and sellers.... So, lets crunch some numbers and go from there

*drumroll..............*

NUMBERS!

60m shares were issued at 10c and 30m are locked in escrow. This leaves 30m shares at 10c of which we can assume around half will not be sold (directors, long term investors etc etc)

My estimation is we have around 15m shares issued at 10c that are "keen to get out". Once these 15m shares are exchanged from seed holders to a fresh set of new shareolders we can make the assumption the selling pressure will ease and *hopefully* the price will drift north and reflect the underlying fundamentals.

As of Tonight around 2.3m shares have changed hands, so we are almost 20% the way through. If you are not yet in AQQ and keen to get onboard you should use this info to your advantage. I wouldn't expect anything less than 10c though as that's starting to approach the cash backing per share which in my mind means your getting the assets of the company for FREE! But I'd look for another 10m or so shares to change hands then the price to begin to move. In summary you should be able to get a little cheaper given the obvious sellers out there but keep an eye on the number of shares swapping hands.

MOVING FORWARD

In my last post we talked about drilling that is underway and plans to increase the 983k JORC resource. I implied they were looking to up there the underground component (Alpha + Phi) however upon close inspection it appears that they are exploring the near surface mineralization instead.

While the lower grades synonymous with near surface mineralization aren't sexy (we're looking for around 1-4g/t) the ease of an "open pit" mining more than compensates. This is a GREAT move by management, looking for an efficient and quick way of generating cash while keeping CAPEX to a minimum (Open pit is initially far cheaper than underground).

AUGUST DRILLS

Keep an eye out for August drill results targeting the near surface. AQQ are confident it can substantially increase the 983k resource.

Personally I will be happy with anything over 150koz increase (and av over 1.5g/t+).. If we can produce 250koz+ then the joy will be overwhelming and I'll probably do a nudie run around the office.

Having spoken to management, nearby mills (Paddington, Belle) have more than enough room to process ore from AQQ. Initially a conservative target of 30-40koz PA is possible. On a $500 margin we are looking at around $20m+ free cash flow.

BUY FOR THE LONG TERM

I have always believed in long term fundamentals over short term emotion. If you decide to invest in AQQ and agree with the reasons above then please accept that these things take time. All we need to focus on is

(1) the Price of gold remaining at a sustainable level and (2) management meeting their promises.

Do that and the rest will take care of itself. Any multi-bagger of mine in the past has been a combination of knowing a company and patience. This stock provides a compelling long term opportunity for those with some patience and who believe the gold story (Great article here for those interested:
http://www.sprott.com/Docs/Reports/reasons_to_own_gold.pdf )

DYOR

Regards,

Coop