Sun Peak (PEAK.V)

Canadian Junior Gold and Silver - research report, mine visit report, discussion, comments, information for a specific company. Hui commentary by Dsquare.

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coach247
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Sun Peak (PEAK.V)

Post by coach247 » Tue Nov 17, 2020 3:43 pm

Well this one was heavily promoted among the newsletter writing game immediately prior to its launch and it initially it performed according to the pump. Unfortunately the risk of playing in a shitty jurisdiction has arisen and the stock has lost about half its value this month after reports of conflict in Ethiopia. Now one can play this as a potential recovery story on the angle that fighting will settle down and the stock can resume a spec premium on the strength of its flagship asset. But its worth noting that the company has nearly $12 million in cash with about 80 million shares outstanding. So the 15 cents per share in cash for a 60 cent stock is attractive on its own, if we just write off the gold-copper project and consider this as a shell with plenty of cash to find a new project.

I may just get on board here. The bigger risk is that tax loss selling is going to hammer it lower, and also that insiders were on the seed rounds with a huge amount of stock that is still well in the money even after this selloff, so there could be a further downside move as the 'wholesale price' insider stock is sold to late retail sheep. I am undecided on this. I do think if they can report that things are settled down in Ethiopia then there is an easy 20-30% upside on that trade. The newsletter guys will probably pound the table on how 'cheap this stock is now' as the angle to get a follow up move higher. Longer term I would be a bit more nervous. I do not hold any right now.

cheers!
mike
"Just two weeks to flatten the economy..."
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