Q: Please provide an update on Luca Mining now that it has achieved commercial production at its Tahuehueto mine. 85,000 and 100,000 gold equivalent ounces seems like a lot for a company with a market cap of 334M$. What is the difference between produced and payable metal? Thanks.
5i Research Answer:
Produced references actual production. Payable metal means the quantity of metal contained within the concentrate for which payment will be made by the purchaser. They can be different due to several factors such as byproducts and purity levels. We think things look quite good here. The stock is getting attention and typically there is a valuation boost once investors are happy that a new mine is operating as planned. The sector of course has also cooperated. EPS is expected to ramp sharply this year with the mine, and the stock is very cheap if it can achieve its earnings forecast. There has also been some insider buying this year.