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Dalradian resources (DNA)

  • 04-12-2013 2:50pm
    #1
    manonboard
    Registered Users, Registered Users 2 Posts: 1,104 ✭✭✭


    I was on my Davy trading account recently and found that a members only research article was subsequently published privately, then publicly, then removed from public access, then republished publicly.

    So it seems that after they let it out of the bag, they decided to keep it out.
    The article I mention is
    http://davyselect.ie/news/article_6673.html
    Underground permits now expected in late January 2014E

    DNA's share price dropped 27% since the end of October (vs. -11% for the S&P/TSX Global Gold Index and -6.5% for gold). This disproportionate weakness likely reflects the missed October deadline for DNA's underground exploration permits. Yesterday's release has put to rest any fears that the permitting process has somehow derailed.

    ...

    Valuation

    Our price target of C$1.90 (unchanged) is predicated on a fully funded NAVPS (5%) of C$2.49 (unchanged) and a P/NAV multiple of 0.75x (unchanged).

    On the back of this, I found a part that I was hoping to get some opinions on. I'm fairly new to trading and such, but I found the price target of CAD 1.90 to be quite extreme given the current price of CAD 0.60 and they have not executed anything more than their competitors up north.

    Davy have lots of experts looking over these things and analyzing the stock, but I found that nobody else was writing articles praising this stock. How could Davy really think it would be worth CAD 1.90? That's a 300% increase. I acknowledge their expertise on stocks but as nobody else on the internet seems to be saying even 100% or 200%, then a 300% seems to be way out of expectations..

    When compared with another gold mining company up the North of Ireland, like CGNR (for example), What could Davy possibly see in Dalradian that indicates such a massive stock growth potential?
    They've yet to actually take any gold out of the ground, just like many of the other gold companies.
    The CGNR company has found a much larger detection of gold, and yet their stock price has tumbled downwards in the last year. (they've also not extracted anything)
    Ireland isn't known for it's ease of operating when digging in a rural area and gold price is in decline.

    Sometimes, I get the impression, the valuations are less about the value or future value of the company based on accounts, and more aimed to manipulate some impression of the company. The valuations often don't seem to have any concrete reasoning behind them.


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