The AFR Smartinvestor headline yesterday said Atrum shares set to rocket
The AFR Smartinvestor headline yesterday said Atrum shares set to rocket. The article said Atrum's prefeasibility study on its Groundhog anthracite mine in Canada is simply outstanding. The journalist who had earlier spoken to the Atrum Coal MD bravely predicted that when the company emerges from a trading halt its shares will surge. What a disappointment, then, when the price has gone up only 1.4%. Why the difference between expectation and reality? Firstly, see my recent Mining Journal column on misuse of discount rates ((VIEW LINK). Secondly, the study came up with a plethora of numbers but no material change to the proposed development or its costs. The result, not surprisingly, was no material change in the share price.
John Robertson is Chief Investment Strategist for PortfolioDirect a provider of resource sector investment stock ratings and portfolio strategies for mining and oil and gas investors. He has worked as a policy economist, corporate business...
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