Friday, May 29, 2020

RNX – Financial Due Diligence

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    Talk about RNC Minerals Financials


    Solid information by @NikG92 on February 2nd 2019, about Beta Hunt and financial scenarios:
    «For anyone who missed it – good snippet from a VRIC article on SeekingAlpha. Discusses the potential concerns due to differing geology in play and hestitation in entering due to the run-up RNC has already had — which could be advantageous from a risk/reward perspective (market underpricing due to lack of understanding or felt the play has already run its course). Keyword being could, but certainly in line with the range of outcomes and where the market is pricing RNC. Downside risk is relatively limited considering Haywood’s report did not update the resource size and still had a 75c target (where Dumont represented a decent chunk of RNC value). There would be concerns in achieving this due to price of nickel and capex required to bring it online, but even their downside scenario of 45c is limited downside vs. upsides of $2+
    Note our base case is 2-4m oz of 4-6 g/t gold.
    Valuation $1300 gold:
    Valuation $1500 gold:

    “In speaking with the company’s head of investor relations, the company is very focused on developing the resource at Beta Hunt. The company had found some smaller pods of gold prior to the Father’s Day Vein strike, which lent some credence to its theory. The company’s drill program is in place to try to confirm this resource. Depending how these results play out, the company will likely be looking to simplify its asset base, as it doesn’t have the resources to develop its Nickel-Cobalt project at Dumont. Reading between the lines, it looks as though this will likely be spun out or sold in the coming year. With this drill program and the potential spin out, there appears to be some significant catalysts to this story in 2019. I was very surprised by the sparse attendance at its presentation, which actually makes me think that the hype is not yet behind this company. In prior years, companies with mega-strikes, such as Mariana Resources’ Hot Maden property or Northern Dynasty’s massive pebble project would be the talk of the conference. RNC is clearly not there yet, but based on the size of its first anomalous discovery and the lukewarm reception to it, I believe there could be some concerns about it, as there was with Novo Resources, due to the different geology that goes with it. This skepticism may be valid, but it also gives a better risk/reward set-up for RNC if it isn’t. »


    Very informative web site of @SeaOfSand with detailed financial analysis:

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