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Nevsun Resources Ltd. Message Board

  • RebornEmpowered RebornEmpowered Nov 30, 2010 12:27 AM Flag

    $1.1B Market Cap - Make Your Case

    My feeling as a potential NSU investor is that this company is currently fairly valued, and has the economics of the Bisha mine going into production baked into the market cap already. Thus, I don't feel at this time that the share price will appreciate as much as other stocks could.

    What would be the major reasons NSU should move higher (other than, of course, a rising gold price which should raise most gold stocks equally)?

    I mean, the Bisha mine will put out over 1m ounces of gold, and is valued at $1.1B. Rubicon Minerals (RBY) just announced an inferred resource of 4m ounces of gold, and their market cap is only $1.3B.

    So, whose market cap is correct? Should RBY's be 4 times as high as NSU's since they have a 4 to 1 gold ounce ration on them? I realize I am discounting the silver and copper that will be mined from Bisha...

    NSU has had a spectacular run in 2010...I wonder if investors think it has had enough of a run and it is time to rest and absorb some of the market cap with some production and cash flow?

    Looking forward to some help...
    Thanks,
    David

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    • nsu will have alot more gold to mine in the area. how much. who knows... but, i assume another 4-5mm oz

      • 1 Reply to cabogordon
      • Appreciate the dispassionate thoughtful discussion. I'm holding GSS (huge disappointment), HL, AUY, a couple other small positions. Thinking of trading the GSS for NSU. Also a little concerned about the politics. But what I'm really concerned about, and I'd love to hear some thoughts about it, is the graph that the CEO posted on the Denver Forum video showing how gold production is going to drop off after a certain time. I imagine they'll be drilling in other parts of the property they own, and maybe by then they'll have more gold. But that means they need to raise money to get it out of the ground. Although maybe they'll have enough from production.

        Again, any thoughts are appreciated.

        Bento

    • the big difference is between the two co`s is the bottom line. Rby is yet to turn a ebitda profit due to high land and acquisition costs and production challenges. I believe NSU will be in the black year one of operation. more to come.

    • Did you factor in the cost of extraction, $250/oz,vs S Africa %539/oz & potential increase in reserve maerial. News says 5 S African gold mines shut down with more to follow (power problems). Very little material coming to market, goverments hording their reserves etc.. Patriot is correct, there is no rationality.

    • The markets are not rational, as your question is rational.

      Best thing to do is buy 4 to 6 good stocks, and use your charts to tell you when to buy & sell.
      I would also recommend Vector Vest.

      GLTU!

      Patriot

 
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