Full disclosure: I ama holder of TSO since RTOYou can go back...

Full disclosure: I ama holder of TSO since RTO

You can go back and see I have been on this forum since the beginning. I just do not post a lot. I appreciate the work of Corgi, Bellaneva, H8, Karmalocust, David123 etc A LOT.

As an investor who has been around the block in the past twenty years, I think TSO is rare and unique

Why?

Unlike many resource stocks on TSX or ASX, it is led by a management team that would rather be out of the limelight than in it. Many TSX/ASX stocks are VERY promotional and with what we have their stock could be currently valued at 3x our price just by hyperbole statements.

TSO has luckily avoided that.

Sure, the stock is almost 10x since RTO in February yet I don’t think fair value is reached.

Why?

It was RTO’d WAY too cheap. It came to the market at 10M AUD mkt cap after it had already been three years in the works funded privately by the current management team. Just look at many TSX/ASX companies and they go to market with a DREAM and nothing of substance. They get 50M AUD market valuations for having a geological plan but no results.

After Friday’s run TSO is now 100M USD mkt cap. This is respectable but honestly peanuts if we think there is a 2-3M Oz deposit here eventually. To the naysayers: YES we do not have that today! I agree. But we are well on our way to eventually prove that. The performance rights for Zeff and mgt are mostly linked to them delivering at least 2M in a proven deposit. I liked Corgi’s link to CML which has slightly over 2M Oz in proven deposit and has a market cap of …750M AUD! Also, with all respect to Australians here: most ASX investors are not familiar with Chile and they discount it. Bring this to TSX and it trades at a COUNTRY premium because it is in Chile! Think about it.

Should TSO be at 750M AUD today? Absolutely not! Could we double from 100M USD mkt cap (0.30 AUD) to 0.55-0.60 AUD and still be reasonably valued? Yes!

Am I predicting that we move another 50%-100% higher in short term? NO! Just like Corgi states all the time I have NO idea what short term price will be for TSO. I just think one has to step back and realize that with a large deposit (very likely), in a top 1 country (confirmed), with high recoverability (confirmed) and low operating cost (900 USD cost likely) we would be super profitable mine. Thiswill NOT go unnoticed to majors. Will they buy us at this stage? NO! That is just dreaming. We need an MRE but the more we drill now the more we will be valued. We cannot run faster than the result come in.

Why not sell now?

Look at bigger picture. We are 45 days away from US elections which could be contested. US markets do not like uncertainty. Higher uncertainty is with high likelihood a good chance of a breakout for gold. Even without company-specific news imagine Gold moves to 2200-2300 by late December, what do you think happens to junior gold? Right…it is going to get re-rated!

On a company-specific level: YES we will need financing at some point but I think it does not happen in 2020. I think we re-rate towards 150-200M USD market cap by late December (this means 0.40-0.50 AUD) per share and then we raise 15-25M AUD with serious insti’s who then want to have a pathway to doubling their investment again.

What does Mondaybring?

I have no idea. Neither does anyone else. Could we trade down? Yes. Could we be up +20% again? Yes. I just think you need a mental framework which I have tried to sketch out here. The data will tell us how far this runs but even after 10x since February (again, this was WAY too cheap at RTO) so please do not ANCHOR yourself on RTO price point! This is a psychology 101 mistake. https://www.investopedia.com/terms/a/anchoring.asp#:~:text=Anchoring%20is%20a%20behavioral%20bias,market%20participant%27s%20decision%2Dmaking%20process.&text=As%20a%20result%2C%20market%20participants,return%20to%20its%20purchase%20price.