Monhawks, , an excellent question, tough one, but an excellent one, Let's say I had $20,000 to spend. ( which I don't because I am fully committed according to my investment plan and have been an active buyer of both recently. :-)
Based on the closing prices today, keeping in mind they have both just gone ex bonus, I'd put $12k into MXR and $8k into GDA. I think they are both way over sold before going ex. My current value suggests GDA should be around 40c and MXR around 45c at this stage in their pre JORC resources.
Depending on the results of drilling, they could both have double that value (from my perspective only).
What might they be in 12 months time? If they progress their respective assets as I hope they will, I value GDA in the 50c to 60c range and MXR in the $1 to $1.30 range but they are just my guesstimates and there is a lot of resource identification that could move the forward estimates up or down. There are also lot's of other influences on the movement of a company's share price, eg, the DOW, market sentiment, comments on Hot Copper, company announcements, media coverage and numerous other events. I have a large number of KPI's which will invariably change my weighting and estimates according to my individual philosophies and trading plan. These can change weekly, daily and intra day. So I guess I am saying, what I see one stock as being value one day, compared to another is extremely variable. As an example, I had 5.5m flinders options last year before they went skyward. I sold some before they went up ( as you do). I didn't buy any after they went through the roof late last year ( apart from some intra- day day trades)and I sold some to buy GDA earlier this year and some other stocks. I saw them being over bought a few weeks ago and sold all but 100,000 and following their recent fall, I am looking at buying some more again. Each day I review each of the stocks in my portfolio and change the weighting I have according to my "good" to "excellent" methodology of rating stocks values.
Back to your question.....
They both have buyers at 15.5c but they have much different number of shares on issue. I think GDA will have a cheaper capex for the haematite than MXR has for it's magnetite, MXR has a mine just started with alluvial gold. GDA's gold is about 18 to 24 months behind at a guess. I think GDA might have more gold than MXR but MXR's looks like it will be easier to extract and being alluvial, there could be a lot more than the 16,000 oz they have so far reported. GDA should be able to get the iron-ore started sooner as DSO is cheaper and easier than magnetite and GDA's CaFe is about as good as it gets, keeping in mind of course, this is based on rock chip samples, but rock chip samples have lead to many a small explorer becoming a company with significant market capitalisation as they move from stage to stage and progressively prove they have something of value. Look at the top 25 iron ore juniors and they nearly all started very small with very small market cap', low market sentiment and having to raise funds and convince investors etc. MXR has more shares than GDA on issue ( about 153m to GDA's ~61m, without the bonus shares for each) MXR will be issuing about 40m new options following their bonus and GDA will be issuing about 10m shares and about 36m options following their bonus issues which I'd guess, depending in both circumstances on how many options get converted) GDA has a cheaper entry based on the fewer number of shares from a market cap perspective. The hypothetical was based on having $20,000, I wish I had $200,000 ! Not an either/or answer but they both have excellent upside I think. Today, tomorrow, next week and next month could result in a different ratio and value, there are just so many ingredients in the choice from day to day. When Mantle (MNM) announces what they are planning to do I think they will set sail also. I think FMG are about to announce their plans for their forward expansion in the Pilbara and I'd expect it to include a rail to Solomon where Flinders has about 300m to 400m tonnes of haematite targeted so I am watching them by the minute as well. Please don't do what I do as what I do suits me and may not suit your criteria , investment timelines, risk profile or investment plan etc. DYOR etc. best wishes for the decision, cheers FS.
GDA Price at posting:
0.0¢ Sentiment: ST Buy Disclosure: Held
