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30 Posts.

21/10/16

14:49

Post #: 20033024
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Originally posted by porker ↑

There is probably not a lot of upside left for shorters at the current SP. ORE has transformed from a speccy to a producer with a reasonably steady cash flow. Back of the envelope, the company has stated it should receive approx 50mil p.a.from SDJSA less corporate expenses of approx. 5mil i.e. approx 45mil. . I assume no profit from Borax. At a P/E of 15 ......675mil or 3.23 per share.
I think this is conservative, so I don't think there is much more downside if the LiCO3 price stays around $10,000/t. The other variables are, there might be a drop in production costs to $2,500/t and of course a new blue sky event if production expansion is announced.
All in all I think the current SP is fair value with little further downside. If this does occur I would consider it a buying opportunity.

P

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That all seems well reasoned. I do wonder what a typical forward PE should be plugged in when one projects 12 months down the road....or, perhaps 60 months.
As you may guess, I think the Market has discounted OROCOBRE way too deeply.

ORE Price at posting: $3.34 Sentiment: Buy Disclosure: Held
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