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VAU - Vault Minerals

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What a great day, but probably due to whole market being up??
I had earlier commented on cup and handle in April on ASF,

QUOTE
I note on the chart that there is now a (bullish) cup & handle formation from the mid-Nov point to now. Also note that the 30 day moving average has just gone upwards through the 100day M (aso bullish) ...so maybe something more positive will happen.
END

when I did comment it looked cleaner at that time what is does now! Still based on that the next (resistance?) target would be 15.5 +(18-11)= 22.5 which seems reasonable next step to me given that earlier NPV were heading about there when gold was $1000+

I think Herc's cup and handle over many years and with target 30 is too much at the moment.
 
I've been pondering the Baker Steel link with top 2 blokes being ex-Merrill. Given that they would have "cred" it seems possible (speculation here before you read on...)that they were they ones who availed themselves of the 11mm shares that Merrill Lynch Futures may have had to loan out for shorting during the recent months.

It would feasibly explain why they had no holding until after Merrill sold out that holding, besides they couldn't morally sell short and put their clients into RED! Now they they (I emphasise this pure speculation on my part) have stopped they could them load up themselves and clients!.

Today I could almost hear the sound of the vacuum cleaner as the loose odd-mill holdings were getting hoovered up !!
 
Mgm1a, why do you say that Hercules target of 30 cents is too high - are you referring purely to charting interpretation? I assume that his target is based on a long time period, and certainly one that will take beyond RED actually getting into gold production in 9 months (April 2011).

As you will agree, from a fundamental valuation RED is extremely discounted, with Siana alone accounting for just over 36 cps at current gold price, and a little extra for cash (~1.5cps), and Mapawa in uncharted waters but likely to add considerable to the Siana base valuation.

With relativity and the premium usually accredited to gold producers, and bearing in mind the market capitalisation of MML having similar production profile (albeit lower cost per oz) there is an argument RED could run up towards 70 cps, subject to gold price staying in the current range.

I know I am a bullish commentator on RED, but fundamental valuations do finally come home to roost at the time of gold production from every stock I have ever followed unless there is either a problem with the production or there is limited reserve life - both of which are not issues for RED at Siana. Siana will be a long life, low cost of production operation.

Mapawa has the potential to be an even bigger deposit with a gold inventory around 3.5 million ozs plus from my rough calculations (albeit based on a few holes of information which are following the classic porphyry gold/copper deposit type so far, and is similar to Boyongan except that Mapawa seems to have much higher gold values from surface, based on trenching information, whereas significant gold mineralisation at Boyongan starts below 100 metres depth!).
 
Beatle - no my opinion re 30c is that seems unlikely in the immediate short term. I had in mind where the SP should now (give or take a month) be sitting. :)

We have some time to go and still operational plant to bring to reality, hence while my NPVs modelling are also well north of 30+ (like yours), the low 20's would be a solid short term achievement to create support, given there are still risks & unknowns ahead before April-11.
 
fastbuck1 said:
Hi Huitzii , can you post the Mac recomendation would be keen to have a read....regards fastbuck........
Click to expand...

IMHO the fundamentals look good,the chart looks promising and Macquarie recommendation settles my nerves a tad, as I said earlier im probably not a long term holder and .20 will see me just fine.
I dont see any reason that RED wont make .20 in the near future ...watch this space :)

RED RECOMENDATION.JPG
DYOR
 
Thanks Mgm1a, I don't have a problem with your comment regarding the price outlook in the shorter term, but in fact I interpreted Hercules charting analysis to be for a slightly longer period, including the start up of operations. Thus my outlook remains more bullish, but in fact there could well be a significant run up beyond 20 cents if it breaks 19.5 cents as that has been the cap over the last few moves up. Each time in the past it has fallen over after failing to break the cap, but this time with the outlook being much more positive I am confident a break through to mid-20's is the first test.

And of course, the outcomes on Mapawa results could substantially change those fundamental analysis numbers - if it shapes up to be another Boyongan (but with mineralisation at surface) then I can see it breaking very quickly beyond the 30's and not stopping!

Thanks Huitzii for you attachment from Macquarie Edge - I note that the analysis was also involving Wilson HTM, thus clearly the signs are that RED will now get coverage from a much broader retail broking base, which adds to the interest already being taken by Fund Managers!

Things look good for RED in the next short while, from all of: An investor support viewpoint, An activity viewpoint, An announcement viewpoint! Bring on the project finance announcement!
 
Hi all, hi Beatle. I noticed on Friday you were an extremely excited man. Post after post. I was reading your posts, whilst at work, thats part reason why i havn't been in touch of late.

Huitzii, thanks for your info on Macquarie Edge, a strong buy recommendation is always pleasing to know. Maybe you should convert yourself to a long terma, and enjoy the ride, ha ha..

Just a couple of questions beatle. Are we expecting any anns in the next 2-3 days other than the results for drilling at mapawa? Also could we find a trading halt Thursday or Friday, or is it to soon just yet? Possibly early next week maybe? Reason why i ask, im looking to buy more, possibly tomorrow.

One last thing, thanks everyone for your input. Lets be realistic, we all want RED to fly and it certainly will in due course. Hopefully after the debt finance approval and results from Mapawa drilling. With a bit of luck it does break through that resistance level of 19.5 cents and creates a new support level, well beyond the 11.5 cents where used to.. An old saying i go by. Theres no point being pessimistic when you can be optimistic, and lets face it, with expected anns, the current gold price, and the future of RED, why shouldn't we be. The sky's the limit...

Go RED, its a new week
 
Hi Moit. Firstly reference to excitement - having been in RED for more than 13years now I am very excited as I can see it finally come to fruition, and there are a number of us longer term RED shareholders that will finally be relieved after all the years of frustration. Thus the argument that RED will give a great return is all dependent upon when one has entered onto the register! Having said that, I now have a considerably greater shareholding, and can see the likelihood of it more than doubling in price soon subject to to gold price, general market conditions, when the project finance is announced and the extent of success at Mapawa.

Re - imminent ASX releases. Well my thoughts middle of last week (ie prior to the quarterly coming out) was that I thought there would be a release re the first couple of shallower holes from Mapawa on Thurs and the Qtrly on Friday. I had assumed those releases because I was aware that senior management are making a trip to North America to give some roadshow presentations and I understand that they flew out this afternoon (sunday). I got the Qtrly release timing right, but the Mapawa clearly was not out due to the assays being not completed. I would assume its unlikely that it will be out during the time of senior management being away, so assume it won't be out this week.

The fact that I know they were working on a few changes to the presentation suggests that they will give an update presentation, possibly on Monday that incorporates some of the news out in the Qtrly prior to them presenting in N America.

As for the finance, its possible that the bank will provide the final project finance facility offer, with documentation, this week but unlikely they will act on it with the senior management away, thus I believe it could be early the following week, bearing in mind that is Diggers and Dealers week and the bankers and RED will be attending (but not presenting) in Kalgoorlie. Its likely that will be the time for an announcement which maybe preceded by a Trading Halt - but also noting that a TH usually is only 48 hours and this may not be sufficient time for RED management and any consultant they may bring in to vet that offer document to make a decision.

I would suggest you have enough time, during the whole of the week to trade, but the following week could see plenty of action - also noting that N American investors maybe also well informed and interested to participate once the finance and mapawa information becomes available.

I remain very excited, the next weeks should be very telling in the history of RED!
 
Hi all, hi Beatle. I noticed this morning there is a new ann. re, investor presentation. Siana gold project- Philippines- North America July 2010.. I'm not sure how significant this info is, as it is all fairly old news to us, but maybe not to however management are trying to get this information out to.

Can you shed a bit of light on this please Beatle.

Regards Moit
 
Hi Moit, and you are quite correct, that the news in this latest Presentation is basically the same as what has been well understood by our local market for a while, and including the more recent updating of investor changes etc.

The previous Presentation of 14 July 2010 actually gives more detail regarding the project, but its all about the audience you are talking to - clearly this is a higher level investor presentation to give a snapshot overview.

The one point that I find significant, bearing in mind we are now at 27th July and that Presentation is current, it refers to the closing of debt finance expected in late July 2010! That means we may see an announcement out this week! That surprised me!!!

Apart from that though, the positive of this Presentation is that we know management are now reaching out further afield to alert the broader investors internationally of RED and Siana's likely development. Hopefully it will also alert the bigger gold players of RED's activities and particularly Mapawa exploration.

I would expect that we should have at least some investors at these Presentations start to consider RED to be a possible investment at the time of the debt finance, thus increasing the demand for shares within the next weeks! I would like to know where the presentations are happening, and aim to find that out on management's return.
 
Hi Beatle, i agree with you entirely regarding todays date and the date expected for the debt finance approval- late July 2010. It does seem that it may be out earlier than expected, possibly this week like you said and todays presentation was just a reminder for current RED shareholders and possible new investors that this is the potential for RED 5 and this is where we are headed...

Beatle in your experience and theoretically speaking, how far could this finance ann, then Mapawa results push the share price. I know your not a psychic, but could this be the re-rating of RED that we've all been talking about?? It would be nice to finally break through that 19.5c barrier and never look back...

Once again thanks for your input Beatle.
 
Hi Moit - I am really peeved as I answered your question and was just reviewing what I had written when the whole damn screen fouled up! So here goes with my second attempt, Lol!

I agree with your comments, but you ask the $64 question!

As I have mentioned before, the fundamental value of RED attributed solely for Siana is mid-30's cents, plus whatever Mapawa may be seen to be worth (and that is a moving target at present). At the time of gold production being achieved generally companies trade at a PREMIUM to that underlying fundamental value, plus the value attributed to exploration assets.

Clearly the finance announcement removes the final impediment to Siana project development, and therefore any doubters playing games with RED share price at the moment must seriously consider those doubts. Whether there is an immediate re-rating beyond 19.5 cents is hard to answer, and depends upon a few other facts, including:
1. Gold price sentiment;
2. General market sentiment;
3. If there are investors wanting to get in once the finance has removed that final risk of development. I have mentioned previously that I understand 1 Melb based insto is seriously looking at taking a position once that finance risk is removed, and that investor tends to take a stake around 5 - 6%, equivalent to 50+ million shares in the case of RED.

IF there is one (maby others) investor out there wanting to take a position of significance then RED share price will not stop at 19.5 cents, but its all a matter of how long they are prepared to wait, and whether the existing investors want to drop shares at a cheap price. Matthews is close to the takeover limit so can't influence the buying side of the trade so easily now.

IF Mapawa continues to prove its potential in the 100 plus million tonnes of around 1.1 - 1.2 g/t gold then we are talking say 3.5 million ozs of gold, which will attract the eyes of bigger gold producers, and this current N American roadshow might assist in alerting those players to consider a big investment in RED as well.

Its an exciting time, and I sure wouldn't want to be leaving things too late to get any future position, although I will probably be encouraged to take a few more once the finance is announced - then it will be the last chance before the gradual or abrupt move upwards toward and way above 19.5 cents is achieved!
 
Substantial Shareholders

The remainder of the doubters (if there are any left!) regarding RED ever moving to higher share prices must surely must reconsider there view now with this latest announcement of Lujeta also becoming a substantial shareholder recently. There are now three substantial shareholders, being:
Matthews 19.2%
Baker Steel 6.0%
Lujeta 5.1%

Each of these investors have put out announcements to those shareholdings recently, therefore they are unlikely to be in RED for a quick buck, and in the case of Matthews Capital, it has been a loyal cornerstone investor in RED for quite a few years but lost its percentage stake only due to the big placement made within the past year. Matthews has regained its major equity holding only recently though, so you can assume its not there to sell out cheaply at current prices.

Strategically the combined shareholdings of these substantial shareholders is now 30.3%. That is significant for two reasons:
1. It keeps 297 odd million shares out of the reach of traders in the stock! As these bigger stakeholders mop up loose holders the availability of cheap shares (at current prices its trading at around 1/3 the estimated worth of the combined Siana, Mapawa plus cash in bank) it will become increasingly more difficult to buy into RED at these levels.
2. In the event that Mapawa continues to confirm a likely gold inventory of PLUS 3.5 million ozs of gold with continued drilling, RED as a takeover target of major gold producers becomes increasingly on the radar! If a major gold producer decides to take a major position in RED, it can attempt to buy on market 19.9% and if it were to do a deal with the substantial shareholders a major could acquire 50.2% of RED, ie effecting majority control of the company!

I would love to see another announcement of another substantial shareholder being declared!

Of course, for any producer, or any other major investor to consider such a stake in RED, firstly it must attempt to mop up 19.9% on market, which is likely to push the share price up considerably, although behind the scenes it might be able to do a deal with some of the other 20 plus instos now on the register to scramble together a strategic stake. Sure as night follows day though, no insto will want to let go of such an investment just as RED is to move into the final phase of development of Siana without extracting full value for its investment in RED!

I have a feeling that we just need one other insto, yet on the register, with an appetite for RED to set the spark for a move up! What is likely to light that spark is RED announcing it has finally got debt finance for Siana development, and we know that is days away now based on RED's latest presentation - I wonder how the N American roadshow is going, that might bring out that one investor to push RED to new highs!

In my opinion, RED is ready to POP (UP).
 
hi beatle - prolly every chance there is at least another sub holder on the way - after all, BOAC (merrill lynch) have been buying on behalf of others

re ross stanley, it has to be remembered that his initial sub holder notice was reached on a 34mill + volume day (10/11/08) - no way in the world was his sub holding achieved via regular on market buying - imo, certain deals have been done between parties leading up to final finance/production timelines

he has arranged to sell outright - i would be more worried if he had been selling down on the sly
 
Hi Fatsoh, good to read your last post, and I agree with your view entirely. With respect to Stanley, it simply would have been a real pain if he had put an on-market sell order in place but of course he would have also ruined his own chance to get a reasonable price and at the same time get his sale through in anything like the timeframe he would obviously had preferred.

It still remains unclear why he chose to sell just at this time, but he putting into the hands of such a respectable funds manager as Baker Steel to me gives it a vote of confidence in the project and actually a reassurance to us smaller shareholders that things remain on track as we understand them to be! The next vote of confidence, the debt finance, should see more investors flock in or insto's add to their existing holdings IMO.

I am amazed that parties continue to sell stock at 15 cents, and I have actually bought some more today as I think its now only a matter of time before the heavies start to push this up, but why would they want to do that now whilst there remain these weak holders! (Absolutely unbelievable IMO!).
 
RED Valuation

Whilst gold has now stabilised at a slightly lower level to around US$1,167/oz, RED's share price has remained fairly steadfast around 15 cents.

On a valuation of Siana alone, RED is worth around 33.5 cps (+ cash ~1.5 cps + Mapawa value?).

We are now on the last trading day of July, and with RED having put out a presentation just a few days ago indicating that project finance was likely to be completed by end of July, one would expect that we are now at a very defining point in time: RED either will announce the outcome of finance very soon, or create deafening silence by announcing nothing!

So far there is no announcement. I still stick to my thoughts of a few days ago, bearing in my mind that senior management have been on a N American roadshow (traveling back now?soon?) that it is most likely that the finance announcement will not be made today, and its possible that with Diggers and Dealers commencing on Monday, that RED will call a Trading Halt in the first part of next week. That TH will be to consider the offer that is presumed to come from the Deutsche Bank syndicate.

I still expect that the positive announcement of project finance being accepted will increase the interest in RED and its shares should move up to reflect the removal of the last impediment to project development at Siana, for first gold production in April 2011.

If I am correct with the timing of the announcement, if its a TH that is called early next week, THEN there is only a short timeframe for investors to get set prior to a likely gap up in the share price thereafter. REMEMBER that there have been three substantial shareholder notices (for increase in holdings) in the past weeks, thus those major shareholders will not want to diminish the value of their investments, they may be in fact motivated to buy some more shares to give the price a help along. Additionally, any risk adverse investors (such as the Melb insto that I have referred to that is eyeing RED at the moment) is likely to step in to take some shares on removal of the TH.

I wonder how many days there are now available for investors to avail themselves of the cheap RED shares now on offer! (I even wonder how much I will be kicking myself about not getting more now - but I am absolutely full to the brim!).
 
Hi Beatle, hi all. Wow its currently 1.40pm and i have never seen volume so low since being a holder of RED 5. Approx 51000... Maybe even the smallest of investors have gotten wind of what is about to happen. No one wants to give up there piece of the pie, not even the day traders... I wonder why, lol

Im actually thinking Monday the 2nd of August for the trading halt beatle. Did you know when management where getting back from North America ?? It seems to me that this is all part of their plan, to get back from N America then launch their attack. Lets hope its well thought out, and well executed...

Red is holding up extremely well considering the market and gold prices etc... Their in a nice position for the pending announcement early next week...

Come on RED!!!
 
Hi Moit, and you are correct about the thinness of trading. Its surely a sign that all are waiting which way it goes!

I don't know for sure which day the RED managers get back from N America, but I do know that they intend to be at Diggers and Dealers, so I presume at the very latest they will be flying tonight our australian time for the long trip back - bearing in mind they would probably have to get to perth for sunday when the flights start from perth to kalgoorlie IF they are going to attend the first day, which is most likely! (They would be pretty tired by them even if they are flying business class which assumedly they are!).

I am feeling quite excited about the fact that its close to D-day, but still relaxed about the announcement happening, but not so relaxed about the exact timing - bankers have their own agenda! I know that RED management have done as much as they possibly can to facilitate the process but financiers don't live in a real world from my past experience (they tend to believe that the world revolves around them, which in this case I guess is sort of correct if we consider the share price of RED to be important for RED and our future benefit!).
 
Moit, the other announcement which is due out within the next week or slightly after that time (of course subject to it being newsworthy) is the release of assay results for the first two shallower drillholes at Mapawa.

If these results are good, and any mineralisation above around 1.0g/t (or even less than 1 g/t arguably) would be considered a great result and would definitely confirm the likelihood of a significant resource being attained from Mapawa and should re-rate RED accordingly. This would be a great follow up announcement to the debt finance offer announcement and should keep the momentum going for RED's share price!
 
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