Rubicon Minerals: Weakness After The Secondary Offering Leads To A Buying Opportunity
- After its latest secondary offering, Rubicon Minerals shares are correcting violently.
- Given that the company now has the capital it needs to develop the Phoenix mine, there is significantly less risk that production will be delayed.
- The company is undervalued on a DCF basis due to the price correction, and its shares should rise as production approaches and commences in 2015.
- Investors who are bullish on gold and want to buy a near-term low cost producer should consider taking a position in Rubicon Minerals.
- Traders should note that low-cost producers have performed very well as they go into production, which means there can be even more upside than a fair DCF valuation would predict.