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To calculate the stock price of Lion One Metals if gold reaches $4,000 per ounce, we need to estimate the potential revenue, free cash flow, and resulting valuation based on increased gold prices.
### Assumptions
1. Gold Price: $4,000 per ounce
2. Projected Production:
- 2023: 20,000 ounces
- 2025: 35,000 ounces
3. Cash Costs: $900 per ounce (as per the current estimate)
### Revenue Calculation
1. 2023 Revenue:
\[
\text{Revenue} = 20,000 \, \text{oz} \times 4,000 \, \text{USD/oz} = 80,000,000 \, \text{USD}
\]
2. 2025 Revenue:
\[
\text{Revenue} = 35,000 \, \text{oz} \times 4,000 \, \text{USD/oz} = 140,000,000 \, \text{USD}
\]
### Operating Costs Calculation
1. 2023 Operating Costs:
\[
\text{Costs} = 20,000 \, \text{oz} \times 900 \, \text{USD/oz} = 18,000,000 \, \text{USD}
\]
2. 2025 Operating Costs:
\[
\text{Costs} = 35,000 \, \text{oz} \times 900 \, \text{USD/oz} = 31,500,000 \, \text{USD}
\]
### Free Cash Flow (FCF) Calculation
1. 2023 FCF:
\[
\text{FCF} = 80,000,000 - 18,000,000 = 62,000,000 \, \text{USD}
\]
2. 2025 FCF:
\[
\text{FCF} = 140,000,000 - 31,500,000 = 108,500,000 \, \text{USD}
\]
### Valuation Calculation
Using a conservative FCF multiple of 10x:
1. 2023 Valuation:
\[
\text{Valuation} = 62,000,000 \times 10 = 620,000,000 \, \text{USD}
\]
2. 2025 Valuation:
\[
\text{Valuation} = 108,500,000 \times 10 = 1,085,000,000 \, \text{USD}
\]
### Share Price Calculation
Assuming approximately 100 million shares outstanding:
1. 2023 Stock Price:
\[
\text{Stock Price} = \frac{620,000,000}{100,000,000} = 6.20 \, \text{USD}
\]
2. 2025 Stock Price:
\[
\text{Stock Price} = \frac{1,085,000,000}{100,000,000} = 10.85 \, \text{USD}
\]
### Conclusion
If gold reaches $4,000 per ounce, the estimated stock price of Lion One Metals could be approximately $6.20 in 2023 and $10.85 in 2025, assuming production increases and costs remain manageable.
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