Q: Will Dundee come back from the dead? Since its low of two months ago, the trading price has doubled, yet (per Rick Rule) the sum of its investments is still three times its current market value. Would a bull market in mining make this a compelling, leveraged value play? Given its current minimal revenues, what would count as evidence for improvement?
5i Research Answer:
We know Mr. Rule from our Sprott days; we have nothing against him, but he is 'promotional'. Everything sounds good. Certainly a mining bull market would be good, particularly if junior miners. We would look to the sector but also to see if DC.A itself becomes more active. We would also look for buybacks, to see if the company is willing to put its $$ up to prove it is undervalued. Current momentum is of course very good, but keep in mind its size and sector risk.