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  5. IVN: I have owned IVN for many, many years. [Ivanhoe Mines Ltd.]
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Q: I have owned IVN for many, many years....back when it was below $1. I have sold bits as it has moved up over the years. I was always told not to fall in love with a stock and feel I might be with IVN.

Can you give me a best case senerio on what the top end of this company could be. I always had in my mind it was worth $12-14, but is it possible this is a $20 stock or maybe a $30 stock someday?

If everything fall in place as planned, no political issues, metal prices keep increasing, etc, what do you see this company being worth in the next 4-5 or even 10 years?

Will not hold you to it, just looking for your opinion.


Asked by Kevin on January 25, 2023
5i Research Answer:

Of course, over a decent time frame, there is also a chance that 'not everything falls into place', as well. We also would not expect metal prices to increase constantly over 10 years: they will always be volatile. Right now, at 15X earnings, the stock is more expensive, by far, than most in the sector. But the growth potential is higher as well. If we look four or five years out (beyond that doesn't mean much), IVN should be able to make $1+ per share. Cash flow will move from negative to approaching $1B.  Still, if the stock is $12, that is still 12X earnings and would be 16X cash flow: still not 'cheap'. It is also possible the company gets acquired before 10 years' lapse. It already has two very large international mining company shareholders at 26% and 14% ownership, respectively. There are thus lots of variables. We also would not count on politics being stable, either. In a metal sector rally, or takeover, we do think it could hit $20. We think $30 might be a stretch unless its earnings growth accelerates sharply through higher production than expected, a new discovery, an acquisition, or some other corporate event.