Q: This small mine on Northern Vancouver Island is humming along lately and I would appreciate your analysis with a buy sell or hold with reasons please?
Thanx as usual
Gary
Thanx as usual
Gary
5i Research Answer:
NCX is up 63% YTD, bringing market cap to $180M. It does not have a producing mine yet, but a feasibility study this year indicated a 29% expected return on a 19-year mine life and a payback period expected of less than two years. Capex is expected at $1.1B which is perhaps the biggest challenge to a future mine. The stock has benefited from interest in copper and the nice rise in the gold sector. Insiders own 14% and have been minor buyers this year. Risks are high here, but it is a good project and the momentum is positive. Lots can still go wrong, but we would consider it a BUY for small cap investors interested in a developer and are willing to take on the associated risks of such.