MoviedancerMargins are critical and I will explain . Let's say...

Moviedancer

Margins are critical and I will explain .
Let's say IO goes to 85 and pellets maintain premium at 130.
Margin is 35 usd or 40 aud x 2.3 m t = 92m cash flowing 20 m for corporate / maintaining Southdown etc so cash flow falls to about 72m
Now GRR are paying out 2 cents so cash end April likely to be about 160 ( 2 weeks shut down in Feb)
Now market cap is would be about 270m at 23 , so EV of 110 for cash flow of 72m although cheap not impossible
Grr is safer to hold than an IO company with debt or limited cash , but when fear increases and sentiment weakens you will be amazed how little the market will pay for Cashflow . During the GFC on stock I hold traded at a 33% discount to cash for 3 months and they were still profitable
Personally I think 23 is a possibility but I struggle to see it go below unless IO collapses