Q: Hi 5i
Given current situation with the Panama referendum, What value does this mine contribute to FM overall value and assuming the vote is negative and FM loses it licences ect...what would you estimate the fair value share price to be...current price is around $13.50.....(I imagine the immediate reaction would be very bad...).....Hi 5i
Additional info for my First Qauntum question, Currently hold small position and want to decide if i should unload it or hold on...inside a registered plan so no tax benefit to sell.
thx
Given current situation with the Panama referendum, What value does this mine contribute to FM overall value and assuming the vote is negative and FM loses it licences ect...what would you estimate the fair value share price to be...current price is around $13.50.....(I imagine the immediate reaction would be very bad...).....Hi 5i
Additional info for my First Qauntum question, Currently hold small position and want to decide if i should unload it or hold on...inside a registered plan so no tax benefit to sell.
thx
5i Research Answer:
The mine is FM's largest asset and accounts for about 50% of its annual EBITDA and 45% of the company's copper production. The stock is down 54% in a year, so there is certainly a lot of the uncertainty price in. But we think a full permanent closure would still hit the stock by $2 to $3 a share (maybe more if there are environmental closing costs higher than expected). We do not like betting on government moves. We would be OK exiting a FM position with a view to examining it again once everything is settled. It could move up sharply on a resolution, but this seems less and less likely to us.