S32 in precious metals denial and sitting on a gold mine - of silver

From seeking alpha

There were two others (Silver Bull and Arizona Mining), but both of their management teams sold-out early to South32 (a base metals producer). South32 (OTCPK:SOUHY) was able to obtain more than 400 million ounces of silver they didn't want (at the time of acquisition). They wanted the base metals. Perhaps South32 will realize they are now a precious metals miner and spin-out a subsidiary as a silver miner?

I always cringe when management/boards sell their silver (or gold) in the ground for cheap valuations. The value of South32's Hermosa mine (over 300 million ounces of silver) is worth a fortune as a silver mine. South32 still thinks this is a zinc project. They will likely have to change that categorization soon, because they will be calling Hermosa a silver mine. NorZinc (OTCQB:NORZF) also thinks their mine is a zinc project. I've sent them several emails telling them it's a silver mine, but they don't believe me. Soon they will.

Zinc will NOT go up in value. Silver WILL! So, if a company can produce 3 million ounces of silver at $100 silver, you get free cash flow of around $225 million. At 10x free cash flow, that is a valuation of around $2 billion. Most management teams will tell you that is a fairytale expectation. Or, that they can't plan using those assumptions. Well, guess what? Once silver does reach $100, they will be forced to use those assumptions.

I have always used $100 silver for my future mining stock valuations. Even today, with silver at $27 and trending, the vast majority of investors are still not expecting $100 silver. South32 and NorZinc are likely still stuck thinking they are zinc miners, and none of the majors are even looking at Discovery Metals yet.