I bought june call options and common shares Thursday. I believe ANV (like many others) has been sucked in to the sell off irrationally. (I'm in GG, AU and IAG now). ANV will more likely be at 17 before 7. Feels like ANV is being pulled back like a sling shot. That's what this feels like. GL
I share the same view. In this situation, I look at a few things- conditions of the company, and the market it's in. The company cannot control the market, but has to be able to deal with what happens there. Is the company strong enough to weather a storm, and positioned to quickly recover? Is the market condition (the storm) short- term, long term, improving or declining?
When looking at the gold futures, we're able to see by the volume where majority of the consensus lies. In doing so, the gold situation appears to be stabilized.
"According to RBC’s calculations, Allied currently trades at just 0.7 times what the company’s NAV would be at $1,000/oz gold. This multiple declines to just 0.4 times the NAV at $1,600/oz gold. If Allied were to trade at the tier II average of 1.3 times $1,000/oz NAV, the stock would be worth $22.71, 92% higher than it currently trades."
With gross profits increasing y-o-y, confirmation of guided production and on track to triple production by 2016, as well as the company having 47.3 million gold equivalent ounces of reserves and resources at its Hycroft mine alone.. I feel this has huge upside potential. ANV has just been unfairly beaten down by uncertainties which lead to panic selling.
Given the recent price action, $7 is a definite possibility but not likely. $7 implies a market cap of ~$630 million; the last time ANV was at that market cap was Q4 2009 when spot gold was ~$1,000-$1050. If gold dips further, anything can happen but recent physical bullion buying has been soaring - this should provide support at current levels. If you believe gold will recover, there is no better play than ANV - rising / proven production in a safe jurisdiction.
Thank you, mbaveritas. Very well thought out post. I've been nibbling the past few days starting at $12.50, $11.00 & $10 today. I'm hungry to throw a lot of money at this under at $7. Feel it will be a 10 bagger in a few years once the metals prices rebound. Same feeling I got in 2008 when I bought SLW at $5.00 a share. I think it got down to as low as $3 if you can believe it. I know ANV has the goods. I have always wanted to invest in it, but the price was too expensive. Now here is my chance.