Investment Highlights
- Amerigo Resources Ltd. (“Amerigo” “ARG” “the company”) is a TSX listed company producing copper and molybdenum through its 100% owned Chilean subsidiary Minera Valle Central S.A. (“MVC)
- MVC has been in operations since 1992 producing copper and molybdenum by reprocessing fresh and historic tailings from the El Teniente mine in Chile – the world’s largest underground copper mine, owned by Codelco – the world’s top copper producer.
- In 2009, copper production totaled 17,674 tonnes, the highest output in the company’s history. We expect the company to post record revenues of $133.80 million in 2010, beating its previous best of $105.69 million in 2007.
- The company has a strong management team with extensive experience in the industry. The company’s Chairman, Steven G. Dean, and President, Dr. Klaus Zeitler, were the President and Senior Vice President, respectively, and directors of Teck Cominco Limited.
- The current forward P/E and P/S are just 8.92x, and 0.90x, versus the Metals and Mining industry average multiples of 37.8x, and 1.63x, respectively.
- We initiate coverage on ARG with a BUY rating and a fair value of C$1.80 per share.
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