how much avb is too much (seriously)?, page-7

It is a good question. One perspective put forward by Warren Buffet was something along the lines of "if you have a diversified portfolio you may as well buy the index. Buy the out performers, the best companies, to make real money." He may not have envisaged owning only one company though.

Personally, I am not diversified at this point in the cycle. That's not to say that I will not sell a percentage after stage 1 hits production and buy CBA for a divvie and a bit of extra security. However, when the time comes it will be a hard decision I hope. It is not beyond the bounds of possibility that the following mile stones will be staring at us later next year (some highly conjectural though);

1. Stage 1 ramping up from initial production to name plate capacity.
2. Enhancing production through the plant to squeeze out extra production.
3. Serraria into feasibility.
4. Sao Jorge into feasibility.
5. Pedra Branca Stage 2 into permitting and BFS.
6. Nova Esperanca drilling program and finding another 1 million tonnes.
7. Exploration programs on new leases obtained through very carefully nurtured corporate and government relationships.
8. The blister smelter is built just down the road further reducing production costs.
8. Etc, etc..

This is an exceptional opportunity IMO and I'm talking as a business to own part of, not the daily share price fluctuations.

Income on this mornings prices;

Volume of copper 26145204.00
Volume of Gold 7798.00
Cu price per lb. 3.17
Au price per oz. 1339.00
Interest charges -7000000.00
costs excludes admin etc -25000000.00
shares on issue 1114000000.00
cash receipts 93426399.50
Earnings 61426399.50

earnings per share US$ $0.0551 Stage 1

A$ conversion takes us to 6c

The same rough sums on 50,000 tonnes takes us to 27.5c a share A$. People can use their own PE. This company has hit all the important milestones IMO and if they continue towards their stated mid term goals of 50,000 tonnes 7c share price will seem ludicrous. Given they have the copper and gold sitting in the ground, located, assayed etc. Given they have stated that the $12 million will turn up this quarter and hence securing the $58 million, given that stage 1 cash flow will fund stages 2 etc. I'd say that 50,000 tonnes in about 3 years is realistic?

I actually think they could throw away the office keys and leave this company sitting on 1 million tonnes equivalent for 3 years then sell the company for 20c a share without mining. In a different economic environment that would be their current valuation. In 3 years time we are likely to see the mine additions of the past cycle top out (and as little new exploration and mine building is being planned at the moment due to world wide expenditure restrictions with the majors) we could easily see copper go back into deficit for several years and prices march higher once again. Blackrock and others have predictions out there on the net about copper moving up in 2015.

In which case you can't have too much :)