Banro (BAA): A golden stock

Filed under: Newmont Mining (NEM), Commodities

This post was written by Minyanville contributor Lance Lewis.

Banro (NYSE: BAA) jumped 13% yesterday after the company announced that it had finally completed its bankable feasibility study on its Twangiza project and proved up nearly 4 mln ounces of its 10 mln ounce resource. Thus, we can now calculate an NAV for BAA.

BAA has no debt. So, assuming $1,000 gold, 3.67 mln ounces of Proven & Probable reserves, an average cash cost of $429 per ounce over the life of the mine (which is based on the feasibility study), and the estimated $410 mln required for cap ex, we get an NAV of almost $15 a share (which gives zero value to the company's current cash balance of around $20 mln and its remaining 5.6 mln ounce resource at Twangiza, not to mention the resource estimates at its other properties).

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Banro (BAA): A golden stock originally appeared on BloggingStocks on Tue, 27 Jan 2009 13:15:00 EST. Please see our terms for use of feeds.

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