Tuesday, October 23, 2012

Copper Fox

Ask me questions if you like. I'll be providing regular input here.

Recent information suggests they have completed it and are subjecting it to a very tough internal and external review. The extra steps are being done to confirm the robust numbers. We are told to expect it any day. From what I know of the process I would venture to guess it should be out now. But given the history of missed deadlines I automatically add a month to whatever they say. That would put it in the middle of the usa election. Perhaps they will surprise us and deliver it before so that it doesn't get drowned out by the election fervor.

8 comments:

  1. Today's trading.
    Once again National had to come to the rescue. Friends using RBC also came to support the beaten down stock. This does not surprise me at all. Yesterdays stunk up the exchange. If our securities guys actually did what they get paid for they would be looking into that. It's not pleasant when insiders and their friends have to come and support a stock that holds sway over a 20 billion dollar property. But that's the way the cookie crumbled.

    While there's jubulation on some of the forums they miss the bigger picture. What this translates to is that there is no support from the street and insiders are just increasing their control over the stock. Some think this means the BFS is coming right away and that's probably wrong. The company has had a PP open and they have to close it tomorrow. That is the first news we should hear. On this subject, the price of the PP's has been dropping despite all the increased value the drilling added. This is innapropriate at best. It send a terrible message to the retail market. It say that insiders get rewarded more and more while the company delays and delays. The retail looks at that as very bad and they don't buy stock. This is just one more strike against the share price.

    What retail doesn't get is how manipulated this stock is. Most of the volume is manipulation. It does scare people off. What the people who've invested long know is that the value at the end of the day has nothing to do with share price. In fact, the deposit has grown so big that a bunch of it will be sold for nothing. Just how many billions can anyone pay? We have the equivelent of about 20 million ounces of gold when you convert all the metals to the price of gold. We do this to make the math easy. What the retail who have not followed every drill hole don't know is that there is actually twice as much there. It will take 50 years to get at it. When you value a deposit using NPV at 8% by they time you hit 25 year out the value is almost nothing. This doesn't mean the deposit runs dry it is just the way the calulations work. This is why the company stopped drilling in mid plan. There's just too much.

    After the PP is closed you can expect the Mira geo science report and that should be an eye opening experience. I would not be surprised to see it and the BFS at the same time. There are people who expect it next week but I wouldn't be shocked if they took 2 weeks or even another month. CUU has been absolutely horrible at meeting deadlines. Even Mira couldn't hit a barn door with a shot gun. It appears the whole industry just doesn't seem to know how to manage their time. So, it's not just CUU. I do see companies who can meet a timeline and they do tend to stand out.

    Now it's time to ask ourselves what idiot sparked the runoff. I can't imaging what they were thinking. That was a lot of shares and for what? Nothing can get in the way of the BFS now. We've heard from 2 fairly reliable sources that everything has been confirmed and the economics are very good. I know first hand that the CEO will not overstate the case. He will understate it out of conservativism. Far better to paint a real picture for the companies that will split up this gigantic project than to pie in the sky it for retail.

    Despite what you've read elsewhere. $7.87 cents is what it's worth for just the deposit and the lands that are under the agreement. That makes this one very expensive deposit. Should the company opt for a lower bid from Teck I'm fine with that. Should we get more, great. It wouldn't make much difference if the whole company was sold or just the deposit. More news tomorrow.

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  2. The question of the day. Did you take a small profit. Looking at the chart it seems a few people did. Some people seemed to think National and RBC would just keep buying and push the share price to da moon. I got some comments critical of my thinking. This was a rescue not a general rally. It would be nice to see them resume staking out positions in advance of the BFS but the rescue was a success. It might be a good idea for them to save some fire power should this happen again.

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  3. $7.87 for shaft creek alone? Or the whole company, including the Arizona acquisition?

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    1. That is for SC alone. That includes the areas covered by the agreement. My original calulations were based of some untested areas that we now know are mineralized. I had posted my suspicions on Agora some months ago about the trend to silver in the north. I used a stats approach to figure out what likely distributions we'd find. In discussions with Elmer I narrowed it down more to what was relevent because some of it will take decades to reach. There is way more than what's on paper but at a certain point the question of how much is too much becomes a factor.

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  4. A friendly at Agora asked if I thought there might be another attack on the sp before the BFS. Yes, high probability. Depth? Not as harsh. That was too expensive and National has more money than they think. It would be a high risk manouver and I think they would get caught in the act this time. That's in part why I think buying time is upon us. The pp must conclude and the rest should follow. I hope to talk to Elmer right after the BFS comes out. (This week xx )

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    1. Thanks for sharing your info/opinions. Just a question about your comment above. Are you thinking the BFS is coming this week? or is that tongue in cheek. I am trying to scrape together more $$ but wonder if two weeks might be too late to get the kind of average PP lowering price of today.

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    2. I think it is sold. A PP will just tell us how it is carved up. These deals take time to put through. 2 weeks might be fine. If not it will be because you got paid out. I do expect the BFS to show up very soon. A week? Maybe but there's no reason for not dropping it right away. I think there would be time before there was a market reaction. That does depend on how much work Jason at IR has done about getting the bigger buyers lined up.

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    3. wow...that was a fast reply, again thanks! I think I'll put it in the works and see if I can get it done. Nothing ventured, nothing gained. That would be a good title for the Venture market in general; at least for the good investments...could just as likely be called Nothing ventured, nothing lost but I'm an optimist and I'm very careful.
      Will check in here daily; twice if time permits.
      Best wishes to you.

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