Q: I see opportunity here to purchase a company that has a single resolvable problem that will not cost any more capital other than that which was lost. Reputational damage will be in the rearview mirror in 12 months. Likely sooner than that the shareprice will begin catching the developing favorable winds of the precious metals sector.
Would 5i agree, dissagree, or add anything to this brief thesis?
Would 5i agree, dissagree, or add anything to this brief thesis?
5i Research Answer:
We would tend to agree. While the CEO firing raises questions on general governance, and has brought out multiple lawsuits, the amount in question ($5.7M) is not material to the company, and the saga of course has no impact on mine operations or production. The new CEO has solid experience. The balance sheet is fine. Negative momentum may carry it down further, and it hit another low today, but we agree in 12 months this will be an old story. It still needs the sector to co-operate, and we would proceed slowly in case there is any more fallout from the firing, but value investors may be interested here.