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    Sunday, November 02, 2008


    Panoramic Resource (PAN

    Panoramic Resources has a similar story to Mincor. They have cash and receivables of $94M (netted off against about $16M in payables and $26M in tax liabilities) plus $109M in the money hedge book. They have 193M shares on issue which is about 80c a share in net cash and equivalent.

    PAN closed at $1.08 on Friday though they have recently been as low as 75c and as high as $6.15.

    Their cash costs are $6.05 per lb with current AUD Nickel prices at $8.47 per lb.

    Merrill Lynch 5-Sep-08 research report values the company at around $5 per share. Their short term nickel forecast is higher than reality but their longer term forecasts are likely too low ($8.5 in 2011 and $8 in 2012). WilsonHTM value the company at $3.51 with current resources. Their Nickel price assumptions are higher than Merril's.

    As with Mincor, there is little downside when the company is selling for cash value (or net cash plus equivalents). It's not clear if the company is worth $3 or $5 but it is worth more than $1.08.
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    Disclaimer and Disclosure Analyses are prepared from sources and data believed to be reliable, but no representation is made as to their accuracy or completeness. I am not paid by covered companies. Strategies or ideas are presented for informational purposes and should not be used as a basis for any financial decisions.
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