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Gold Reserve Inc. Message Board

  • mmjohntx mmjohntx Jul 14, 2004 4:03 PM Flag


    When factoring in everything including a Venezuela discount, I come up with US$16.00 as the ABSOLUTE MINIMUM GRZ is worth.
    I believe GRZ should continue to use cash to prove up the resource, avoid the dilution problem that most exploration companies find themselves in and fast track the metalugical and feasibility studies.
    As long as management can achieve this, I am confident that a major will buyout GRZ in the next 1-2 years at a price atleast 5-6 times where it is currently trading at now. That's a heck of a return over that time period.
    I recently picked up an additional 3000 shares at $3.10 and will hold until I can get atleast $16.00.

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    • $16 a share with the current number of shares still works out to be under $50 an ounce allowing zilch for the copper, which is cheap for a mine where the infrastructure is so handy and costs low. One would think that nobody is going to offer that now for a $3.75 share, but it is exactly what the market already values Crystallex's reserves at in the same location, with a lot more doubts and difficulties than GRZ.

      I am constantly amazed by the so called investors who have no concept of the word "share" and don't even know how many shares the company they own has in the market.

      Just compare the difference in leverage that the number of shares creates.

      KRY has over 200 million shares; GRZ under 30 million for a similar ore body. Even if the risks for KRY and GRZ were equal GRZ should get at least 7 times KRY's gain per share that every increase in the POG brings.

      For GRZ every $10 dollars an ounce that gold goes up adds another $5 million future PROFIT annually ($75 million over the 15 year life of the mine). That's $2.50 a share for each $10 increase in the POG.

      Now for KRY, even if they upped their piddly proposed mine 20k tonnes a day to match GRZ's 70k tonnes a day should only get 37 cents per share for every $10 increase in the POG.

      • 1 Reply to thevet43
      • I know that you have given several examples of gold per share in the past, and you always end up saying the copper is free!

        The problem is nobody knows how much copper per share they get in your example$$$.

        Since other mining companies use "gold equivelent ounces" perhaps that would be a better way to show value of metal per share, rather than just saying that "the copper is free!

        2 billion pounds of copper is around 59 lbs. per share at 34 million fully diluted, or around 70 bucks a share in copper, about another 1/6th ounce of gold on an equivelent basis...

        All for less than the price of a value meal!

        And the gold is free!


    • follotheyellobrickroad follotheyellobrickroad Jul 14, 2004 10:56 PM Flag

      John, be sure to grease that pump every so often...
      You said <<I recently picked up an additional 3000 shares at $3.10 and will hold until I can get atleast $16.00.>>

      Sp you don't take profit on the way? Or you think its goin strait up?

      Yeah right!

      • 1 Reply to follotheyellobrickroad
      • It's always easy in hindsight to see where you could have sold, pocketed some cash and bought back cheaper in any stock, but unfortunately it's very hard to do it right.

        I don't think that GRZ will go "straight up" but I would hate to sell the day before the inevitable offer to buy was made and leave the bulk of the money on the table. You can sometimes trade a portion by selling peaks and buying dips but once you factor in commissions and taxes you are more likely to lose than gain.

        There is nothing wrong with taking a profit at any time, but I have always done better when I ignored the minor ups and downs and waited until the market value and the intrinsic fundamental value of the stock were in line. The market usually gets it right eventually but it always seems to take longer than we all hope or expect.

    • only if takeover is done just as the gold starts out the back end of the mine so to speak. any sooner and the takeover will be closer to 6.00

      • 1 Reply to goldsilver_ratio32to1
      • I think tht the poison pill will prevent a cheap buy out offer from being successfull.

        Any buy out will come at a fair price, and with $400 gold $16 is fair.

        Don't rule out GRZ staying independent and developing the mine on its own. This seemed far fetched a few years ago but no anymore.

        In fact it is almost a fateful certianty that the first boyout offer will come only after so much work has been done that we no longer want one.