Avocet Mining Share Discussion Threads

[brad1] 27/1/2006 22:28

I agree that they are worth a lot more than they are now, but we need to be patient as they are trying in a good way. I would not like to see AVM go down the risky line. If they took a gamble they could treble in price almost overnight. But I think the management are trying to build a sustainable company. I agree with a lot of past posts that the only way for gold is up, but I would not like to see this happen too quickly! No I wont go into the other way!! BUT, having been with these for quite a few years, they are STILL one of my favorite shares, as the potential gain far outweighs the risk! And I still stick with a short term high in the low 200's.

[kojak78] 27/1/2006 21:21

Today I bought a few thousand more shares for rounding purposes. AVm is still the best bet on higher gold prices.

Of course some diversification is right. I recommend Minefinders for this purpose.

The markets are crazy!! Minefinders has 100 mio silver in reserves. If you see them as a silver company the cash costs per oz are negative $6-$7!!

Silver Wheaton has 70 mio ozs in reserves and way higher costs ($3.90/oz).

SLW: ($9.5 - $3.9)*70 = $392 mio
MFN: ($9.5 - (-$6.5))*100 = $1600 mio

One should expect that Minefinders costs 4x Silver Wheaton as they are worth 4x as much. Wrong. Minefinders market cap is $260 mio vs. $1180 mio.

That's a valuation difference of 18.5x or 1850%.

It's the same with AVM. We try to calculate fair values for AVM. But we forget that there are other stocks with the potential to increase production significantly. Companies with huge resource bases and low reserve bases. The market factors potential higher production and potential additional reserves in. Take a look at St. Barbara. $850/reserve oz!!

$800 mio or $1000 mio for AVM is fair value right now.

[holdontight] 27/1/2006 19:30

JAKARTA (AFX) - A major earthquake measuring 7.7 on the Richter scale rocked
eastern Indonesia, the US Geological Survey said.
The quake occurred at 1.58 am (1658 GMT Friday) in the Banda Sea, around 195
kilometers (120 miles) south of Ambon city at a depth of 342 kilometres (212
miles), it said in on its website.
There were no immediate reports of damage or casualties.
The US-based Pacific Tsunami Warning Center said "no destructive tsunami
threat" existed.
Indonesia's Aceh province was the hardest hit by the 9.3-magnitude quake off
the coast of Sumatra that triggered tsunamis on Dec 26, 2004. The waves killed
more than 220,000 people around the Indian Ocean.
[e-mail]
afp/har

[reefseeker] 27/1/2006 09:10

Couldn't sleep Ashley?

Topped up my AVM holding yesterday, now 10% of my portfolio.

Delighted with my stake in SLW over the pond, up 10% each of the last two days but looking a bit pricey now, may topslice and take AVM to 15%.

[corrientes] 27/1/2006 00:15

Holdontight - FDI AVM KGI and RDG are my major AIM mineral resource holdings at the moment.For me the first two are highly profitable so far and only RDG is showing a small loss. KGI has been held back by production problems and has disappointed many, but the ore is there bigtime, and the company seems to have real potential. I think you know about RDG, but with ML recently buying in, the concerns about the rand somehat abated,maybe rising palladium prices not being factored in and some major financing to soon be announced,I don't expect (hope) to be showing a loss for much longer.All IMO.

For oilers am in AFR and FPM, again doing well, but confess to have made one or two expensive clangers here. I was daft enough to have bought into OILQ and CMR, two or three years ago,and should have stuck to my resolution of checking management ability as best an amateur can.Lesson learnt.

I'm not terribly good at picking non natural resource stocks and prefer to invest in a good collective fund.

Apologies to other posters.Won't clutter up this board again.

Regards
Corrientes

[holdontight] 26/1/2006 23:36

Becoming increasingly clear to me that AVM are going to buy Dynasty.....dyor etc....if Eldorado dont get there first, that is.

[holdontight] 26/1/2006 22:54

Corrientes....so we both hld AVM and LEAD....what else do you hold?

[goml] 26/1/2006 22:42

corrientes, shhhhhhhhhh, can we keep it on here please.

[corrientes] 26/1/2006 21:42

Only a couple of months before they announce a maiden dividend in case anyone had forgotten.

[kojak78] 26/1/2006 19:33

What about Minefinders??

(750 - 0) x 1.44 mio = 1080 mio

1080 mio / 40 mio shares = $27/sh = +285%

Of course the silver price will climb too, $12.50/oz.
That will lower cash costs to negative $130.
(750 - (-130)) x 1.44 mio = 1267 mio, /40 mio shares = $31.68 = +350%

And now at current prices:
MFN
(550 - 0) x 1.44 mio / 40 mio = $19.8/sh. = +182%
GFI
(550 - 380) x 65 mio / 495 mio = $22.32 = ca. +10%

Conclusion:
The undervalued stock will still outperform the highly leveraged stock in a bull market scenario, BUT IN A NORMAL MARKET THE LEVERAGED STOCK WILL DO NOTHING OR LOOSE WHILE THE UNDERVALUED STOCK WILL STILL RISE.

[kojak78] 26/1/2006 19:26

BTW. AVM upside at $750 is 210% or so.

(gold price - cash costs) x reserves

(750 - 380) x 65 mio = 24050 mio

24050 mio / 495 mio shares = $48.60/share GFI price = ca. +150%

(750 - 275) x 1.8 mio = 855 mio

855 mio / 110 mio shares (fully diluted) = $7.77/sh = 437p/sh = +210%
without Taror/Chore/Bakan!!

[chipperfrd] 26/1/2006 16:51

For info: Mineweb article about which companies stand to benefit most from a rising pog.
No mention of AVM :~(

[kojak78] 26/1/2006 14:44

Oh my dear. Just read in a German forum, very pro gold a few years ago. In the last 12 to 18 months rarely postings about gold. Now the first messages asking about HUI shorts are appearing.

Gold and silver and shares are going much higher.

Best bets:
North America - Minefinders
Europe - Avocet
Australia - Emperor

In another forum (only about gold shares) you are attacked if you mention Minefinders (low grades), Emperor (losses), Resolute (hedges), Avocet (no reserves) or DRDGold (will go bankrupt even with gold $600).

The darlings of those investors are silver shares (IMO way too expensive), Cortez exploration shares ($500 mio for nothing except exploration, Barrick and Newmont hold the best areas), Yamana, Gammon Lake and Desert Sun.

[kojak78] 26/1/2006 12:16

And stochastics nearly turned to oversold levels.

A few days of sideways correction, then the sharp drop yesterday/today, technicals back in more reasonable levels, gap closed..

I wonder why Avocet has no gaps left (except in the 200 to 220 range and the first breakaway gap in 2002)? The XAU has 3 gaps from December/January alone!!

I guess we could see the 160 to 165 range very soon. October price target still 300 to 350p (with HUI 450, gold 650).

[kickstart] 26/1/2006 11:41

Everyone asleep today as we rebound strongly ?
I think we may see an explosive move up in Gold before we get the long awaited correction .Bought more AVM earlier as I still reckon AVM is the cheapest Gold producer share in the Universe.

[advaita] 25/1/2006 23:35

Alternative search engine for those disgusted with Gargle's surrender to the murderous Chinese government -

[richgit] 25/1/2006 23:32

Has anyone noticed that POG is valued at £822 Million ?????

True- they promise so much for 2009 and yet so much is maybe already priced as defacto.
However such valuations leave a lot of room for Avocet which has the World at their feet and could now raise the finance to do almost what they want.I asked Management quite some time ago whether they would consider a move into China-and opportunistically they have-a typically shrewd and calculated investment.

So what could this Company have under its belt by 2009?- Considering I believe
the Company is more undervalued now than it was at 60p-I would wager that at
such a current low valuation-A hell of a lot !!!!!!!.

Maybe this time I will suggest to them a nice safe diversant foothold in Europe by taking over Ormonde.


Started buying again at £1.

[ianwc] 25/1/2006 19:10

If anyone is interested, there will be a small gathering in London this Friday to listen to a presentation by Solomon Gold. They are listing on AIM soon and have some interesting projects in the Solomon Islands.

Drop me a line for further details.

[e-mail]

[taylor20] 23/1/2006 17:13

Not sure if this has been posted before:

a short Research Note (on Dynasty) from Midas Research:


Thanks to Don 90 on the iii site.

[kojak78] 23/1/2006 16:11

AVM has
1.5x resources of Desert Sun
1.5x reserves of Desert Sun
over 2x production of Desert Sun
+Taror/Chore afterburner

AVM technical setup looks very much like Desert Sun at $3, now they're up 20% in a few days.

Desert Sun has 485 mio market cap (fully diluted), AVM at 170p still has only $333 mio, compared to Desert Sun $727 mio or 370p/share would be fair. Now.

As long as we have so much upside left it is very dangerous to let one single share go. It is probable that every single share sold now will never be bought back again! Trading is dangerous.

[kojak78] 23/1/2006 15:49

Last year third quarter production was out Feb. 2nd, full year results in May. I don't know when reserve figures will come out.. the most important development in reserves is Taror/Chore feasibility, AVM management promised to deliver a feasibility study in 18 months back in November. There is the chance that both mines may never become economic. Nelson Resources had a pre-feasibility which translates into $200-$250 cash costs I think, but the main problem seems to be metallurgy with refractory ore. I think AVM will do some metallurgical testwork/test production first.