PPS 25 cents. Well, your price forecast seems to be on schedule. At least above mentioned price target of $0.50 is breached.
IMO, it's impossible to predict if management manages to alter the downward drift. It's time to put the cards on the table and tell the truth about all technical issues CSI is facing in its Serra Pelada project.
$1.10 target price would be more consistent with the first market reaction before publication of new drilling results.
I consider the rise in PPS late yesterday and today slightly premature, since increased resources do not solve the imminent problem of financing and legal complications following Wesizwe's exit.
Usually, other annalysts follow suit.
The management of CSI does not show the competence needed to solve the technical problems and calm their investors. Hard to raise much needed capital under these conditions. I doubt that $0.50 is going to hold.
Today we hit a new 52wk low at 1.31. That's a staggering 78% below the 52wk high!
Where's the stop? Does is all depend on COLUF now?
I'm not a lawyer, so no idea about the legal side of this "deal". Obviously a good deal for the insiders, that's sure. For normal shareholders it's just a black box. You only can see what's going in and out.
As you mentioned, the company has invested $500 million. Considering the debt of roughly $70 million, that gives an initial capital inflow of roughly $430 million. And now it gets $33 million for a 44% stake in the capital?!? So the initial capital inflow has been diluted all the way down to a mere 33*0.44/(430*0.56) = 5.2%
Well, nice joke, getting 5 cent for your dollar. Thanks!
It's always the same frustrating scheme: first the mine gets into trouble then vulture investors short it down all the way to levels where normal shareholders (i.e. non-insiders) lose almost everything. Management will still be fine at a POS of 0.30 when the next round of financing takes place. But as a shareholder that type of investment is only profitable if you have insider information and get a special financing deal.
Usually at this point of price cycle and in this condition of market psychology we can expect to see another 30 percent down movement as a final sign of capitulation. Then - without doubt - will be the time to start buying cautiously. Could be at the end of the year as canine said. Could be sooner. Who knows...
I like your thoughts on silver!
Growing Chinese retail demand should support the POS, but on the other hand the metal's supply side does not look rosy. There's a significant oversupply which won't go away overnight as it took several years to build. Instead the producers will try to squeeze their costs in order to stay in production and generate cash flow as long as possible. So the bottom in market price might be somewhat flexible and not as robust as investors in the metal or in companies like SLW would like it to be.