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The forecast annual production rate is 108,000 ounces of gold for February 2012 and 150,000 ounces of gold for March 2012. With a gold production rate of 150,000 ounces of gold, the company should cash flow in the neighborhood of $150 million per year. Even after the run up in price, the market cap is still only slightly more than $300 million.
Considering that the company is planning on expanding production to 300,000 ounces of gold in a couple of years, I would not be surprised if Yukon-Nevada becomes a four-bagger before 2012 is over. Throughout the year, there are several catalysts likely to drive the stock price higher. For example, a new 43-101 is expected to be released showing additional resources. Also, the management is seeking a listing on AMEX.
Disclosure: The author owns shares of Yukon-Nevada Gold Corporation.
About the author:
Mariusz Skonieczny is the founder and president of Classic Value Investors, an investment management firm. He is also the editor of Ultimate Value Finder, a monthly newsletter that features three underfollowed, unknown, and undervalued companies ignored by Wall Street. Visit Mariusz Skonieczny's Website
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