SBM - UNHEDGED

Today has seen upward pricing movement in relation to both DIO and SBM (a substantial shareholder in DIO).

Earlier today, FAT PROPHETS issued a "Buy" alert on SBM, noting that:
1)
SBM is a major unhedged gold producer with full exposure to a rising gold price.
2)
According to FP, SBM's resource base is >1.5m ounces and a reserve base of >400,000 ounces, making for 10+ years production at last year's 150,000 ounce rate of production.
3)
In 2001, reserve and resource bases increased substantially (>30%) whilst "(FP) believe that there is further potential for reserve and resource expansion over the next few years".
4)
Based on current revenue and Mcap, SBM is valued 20.4x revenue (with an Mcap on 24/4 of $44m, -vs-2001 sales revenue of $71m).
5)
After tax profit for 2001 was ~$10m, making for an effective profit margin of 14% based on a lower POG figure than is currently in play.
6)
At an Mcap of $44m, and a NPAT of $10m, SBM's p/e ratio is something in the order of 4.4x.
7)
According to FP, "(s)ince reaching 29 cents in February (its highest level in over four years), SBM has undergone a corrective pullback".
8)
Overall, FP considers that good is now starting to move into "an emerging bull market" with SBM's share price keeping in check with a higher gold price.
9)
FP's initial price target for SBM is 30c.