At 5.6c per share, their earning last year was 0.0039 per share,...

At 5.6c per share, their earning last year was 0.0039 per share, which is about 7%pa return (worse than ABY, I know, but nonetheless undervalued)

Now, they have other tenements too and higher grade still left to drill. The best Treasure Island results returned 59g/t which is insane.

It produced 21036 ounces of gold last quarter, and targets 110000 ounces in 2011.

In 2010 annual report, their total cost of production is around $845 AUD an ounce (have taken total expenses divided by # of shares). Gold is around $1360 USD per ounce.

So, total profit in 2011 expected to be, conservatively ( $1300 - $850 ) x 110000 = $49.5m which is ~0.017 per share, about 17%pa return!!

ANZ owns 13%
HSBC 7%
Citi 4%
JPMorgan 1.12%

Gosh, so I'd like to know what the negatives are for this stock. For once, I think it's quite a large share register - about 3b shares on issue. But that's hardly a big issue IMO.

What about management? Are they any good? It seems that they've failed to deliver on the target of 80,000 ounces of gold by 3,000. Thus, a shortfall or sorts, to the tune of around $1.3m profit.

And what's going to happen with Treasure Island going forward? Are they affected by the weather at all?

I'm just researching, so please correct me if I've made any errors.

If the above all add up, then this is such a screaming buy it's not even funny.