maccas value at 61cps

  1. 934 Posts.
    The latest Macquarie research on Redback has a valuation of 61cps.

    "Valuation and earnings outlook
    · Chirano, on a stand-alone basis (DCF method, conservative LT gold
    price US$327/oz escalated, no hedging), is valued at US$53m (after
    capital). The overall valuation for RBK (85% of Chirano, nominal
    valuation for resources, less corporate, tax) is estimated at 61cps.
    · In the first full year of production, FY05, we estimate RBK will earn
    A$11m (after minorities), thus placing the stock a low PER of 4x."

    With Canadian company Golden Star Resources taking a stake and buying Resolutes treatment plant plus the BFS due very soon, I can see the future of RBK being aussie owned will soon be a thing of the past, shame, its been a nice little trading stock.

    "Share price drivers
    · The stock is expected to re-rate with a positive announcement on the
    completion of the BFS, thus highlighting firm production, cash cost and
    capital expenditure numbers. RBK will then elect to proceed with
    securing debt financing for project development.
    · RBK has corporate appeal. Last year Ashanti made an unsolicited offer
    for RBK (prior to pre-feasibility study completion), valuing the stock at
    31.5c. We expect Ashanti will still be interested in the Chirano Project.
    Further, we suggest Resolute (owner of the Obotan plant) would also be
    monitoring RBK’s progress. The Chirano Project may well fit into the
    growth plans of existing West African producers that have a strategy to
    consolidate operations in the region to create 500,000ozpa plus
    producers. RBK has highlighted in the past that is not averse to being a
    party to such plans.
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