Metal Tiger assets and share price correlation #MTR

Metal Tiger share price continues to have no correlation to the assets of the business. The following graphic indicates the share price is 10% less than the known tangible assets of the business.

This makes no sense when you consider this doesn’t take into account the 2% Net Smelter Royalty Metal Tiger have negotiated with Sandfire and now, also with Kalahari.

This graphic indicates the value of each part of the Metal Tiger portfolio.

Investors Chronicle have Metal Tiger as a bargain share for 2020. Read the full article here.

This is an extract from the article:

Not only do the shares trade on a 25 per cent discount to the company’s last reported fully diluted NAV per share of 1.71p, but there is massive hidden value in the balance sheet, too. Furthermore, following last autumn’s takeover of Australia-listed MOD Resources by Sandfire Resources (Aus:SFR), a A$1bn market capitalisation cash-rich and dividend-paying Australia-based mining and exploration company listed on the Australian Stock Exchange, Metal Tiger now holds 6.3m shares in Sandfire, which have a current market value of A$36.3m (£18.8m) on which the company earns a tidy A$1.5m (£0.8m) annual dividend. Metal Tiger received a £540,000 final dividend from Sandfire shortly after the MOD Resources takeover completed at the tail end of last year.

In effect, the value of the Sandfire stake and net cash on Metal Tiger’s balance sheet backs up all of the company’s market capitalisation of £19.6m, leaving the rest of its investment portfolio in the price for free. That’s anomalous as it implies there is nil value in Metal Tiger’s other seven listed holdings which have a combined value of £3m, nor any value in its unlisted holdings which I calculate have an aggregate value of £8.5m based on their acquisition cost, latest earn-in valuations or read-through valuations based on recent transaction multiples.

By my reckoning after accounting for the A$2.4m (£1.3m) Metal Tiger has invested in last week’s Australian Stock Exchange IPO of Cobre Pty(Aus:CBEXX), a company offering exposure to the Perrinvale copper project in Western Australia, its total investment portfolio net of all liabilities is worth around £31.9m, or 63 per cent more than its own market capitalisation.

Interestingly, the share price has traded in a tight range between 1p and 1.65p for the past 13 months, a breakout above 1.65p would confirm completion of the base formation and support a move towards the June 2018 highs north of 3p. Bargain buy.

Metal Tiger is beginning to be recognised by the market for what it is with for example backing from Rick Rule of Sprott Inc.

Will the next announcement from MTR be about the IPO for Pan Asia Metals or another strategic investment?

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