Good Evening people. Well I am pleased with the latest CR that...

Good Evening people. Well I am pleased with the latest CR that this Company came up with and I was not suprised one bit.When I have shares in a Company and it goes into a trading halt due to a capital raising I cringe.But not here.I was not worried what at all.

Over the past 5 years or so I estimated that I have bought and sold shares in about 50 Companies.I am not going to pretend that I am a wannabe Warren Buffett.Out of my buys there are only two to me that stand out and have made me some serious moolah.Thats right only two!Sad but true.It just shows how tough of a gig share investing is.CCU is one of those two Companies.Admittingly the silver price has paid its part but the key here is the management and then its tenements.

I will recall some of a post I wrote a few weeks back:

At a current plan of producing 2.6 million ounces per year over 5 years I get:


POS $ 34 39 44
income$ 88M 101M 114M
less costs$ 21M 21M 21M
EBIT$ 67M 80M 93M
EPS cents 30 36 41
SP cents 105 126 144

I have used a PE ratio of 3.5 for a 5 year mine.So at the current time I have a share price of $1.26.

However what really excite me here is the potential to add to reserves.Currently CCU has:

14 moz of reserves
51 moz of resources.

That suggests to me that there is a very good chance of a significant upgrade in reserves.

IF reserves increases to 20,800,000 moz (a 50% increase) just a figure I made up then CCU could produce the same amount of silver but have a 8 year mine life.We then get:

POS $ 34 39 44
EPS cents 30 36 41
SP cents 180 216 246

I have used a PE of 6 for an 8 year mine.Just another assumption.$2.16 is very achievable in the near future at curent prices IMO.

There is plenty of legs left in this one and I thought I would just update some figures rather than just saying CCU is a buy without substance.

To update $1.44 is a fair price at the current time but with further resource/reserve upgrades this can go a lot higher.The current reserves and a short time frame to production gives us a solid base but the rising silver price and these imminent resource upgrades could really put the icing on the cake and send this stock into uncharted territory.The trend is your friend.I have made mistakes in the past of selling my 'winners' too early, but this one is a keeper.Of course things can change but I have no attention of selling these in the near future because it is so hard to find a replacement that comes close to such a quality Company.The trend is your friend.

Happy Investing all