Power Nickel - how is it relative to other junior mining stocks?
Unrelated, can you also comment on the offer for Indigo to be taken private? Is now a good time to sneak in?
PNPN market cap is just $35M and it needs to be considered exceptionally speculative. It has a tiny bit of cash, but no revenue, losses and negative cash flow. Cash burn was more than $10M in the last 12 months. It is going to need a lot more capital to develop its properties in Chile. The stock is down 90% from 2017 levels. Insiders own 8.5% and Critical Elements owns 8.6%. While it is not without potential, we think any buyers have lots of time here as equity financings will likely occur on a regular basis. We would consider it too risky to endorse today. Relative to others, we would consider it 'decent' but it all depends on drill results and project economics, which vary widely.
The IDG offer seems very opportunistic, and of course is being coordinated by the husband of the on again, off again CEO. The stock has been a disaster. The $2.25 proposal is not yet binding, and there is not much arbitrage left at $2.16. We highly doubt any other parties get involved in this mess and we would have no interest now.