Pesa - your question is a good one. What is the value of TAM... The biggest issues in the analysis of value that I can see are: 1. When will anything actually happen with CTP? Its been sitting in this JV state for years and NST's interest has only diminished during that time (other projects (Pogo, Super pit etc.) taking priority over capital and human resources). Someone else might know - but I don't recall that there was an end date to this JV(??). If that is the case then the project has to wait until it is of higher order interest to NST before anything happens. That could be sometime away, given NST don't refer to CTP in their preso's like they once used to. So a clear project timeline needs to be set out before value can be considered. On that front there is no clear (stated) evidence that the TAM directors are really pushing hard on NST to do something. More typically a JV would have a best endevours clause that hold both parties to actively work together to progress the project - or the JV dissolves. Given what we have seen with gold prices, a reasonable resource base and a plant in place (needing some refurbishment - but a plant in place) it cannot reasonably be said that both parties have pulled out all stops to get CTP flying. What would it take if the conditions of the last several years haven't resulted in a start? 2. Costs are important in analysis. Revenue is one thing - but what will be the AISC of ongoing production? Value will be determined based on estimated earnings after tax, depreciation and amortization - converted back (at some reasonable discount) to dollars of the day. Put simply, the company cannot be valued at anything near revenue value. Likely an estimate of 30-40% of a reasonable resource at a reasonable (medium term, conservative) gold price ($1650) may be a closer basis. Other options exist for value. Value can be created for shareholders in other ways besides CTP. TAM could have used its cash and liquid investments (at least 35M$) to do something else with - but there is no evidence of this either (other than a sell and a buy of NST stock to yield about 75K$) Instead, Q after Q we see a report that discusses an increasingly insipid update on exploration activities (by NST) and a cash and shares status. The capital is very lazy and the directors have (all) been there a long time doing not terribly much. Perhaps a board refresh might bring some new energy and a sense of clear purpose. All that said, the value (its an option) is much better than 8.5 cps and the risk is low to holding (actually if you bought in 2018 you have likely doubled and or tripled those dollars - and not too many gold companies could point to that outcome). Personally, I wouldn't be a seller south of 20 cps. At 1175M shares thats 235M$ MC for current 60% of CTP option on progressing.
TAM Price at posting:
8.4¢ Sentiment: Hold Disclosure: Held
