Metal Tiger a share with great potential #MTR

Metal Tiger is an investment company focused on the minerals exploration sector.

Metal Tigers main success to date has been their investment in MOD Resources which resulted in MTR acquiring 3.64% of Sandfire Resources as well as an uncapped 2% net smelter royalty.

This is a perfect example of what MTR can achieve when one of their investments delivers. As can be seen from the graphic below Metal Tiger have many other investments that could deliver more of the same.

Graph indicates value of asset 18th Feb 2020

At sometime in the future the BOD will want to make significant returns from their time and investment in building the MTR portfolio of projects. Unlike private investors they can’t sell their shares as this would be detrimental to the share price.

They will therefore need to sell the business or opt for a special dividend. Whatever happens this will be a significant event for shareholders.

Looking at the portfolio MTR have some investments that could potentially provide a significant uplift to the share price. For example:

Greatland Gold

In February (18th Feb) MTR’s shares had a market value of (9m shares @ 5.08p) £457k. Today the shares are trading at 7.5p giving a market value of £675k. That’s an increase of 47% in 2 months.

Not bad when shares are under pressure from the impact of Covid19.

Sandfire Resources

In February MTR’s investment valued at £16.6m (based on exchange rate at the time and share price of AUD$ 5.7). Today this investment has a value of AUD$ 4.08, a reduction of 29%.

This reduction is due in my opinion to the impact of Covid19. In the period Sandfire assets have increased. The share price you would therefore expect to exceed the share price in February once Covid19 under control.

In the same period MTR’s 2% Net Smelt Royalties have potentially become more valuable due to discoveries made by Sandfire.

Summary

Metal Tiger are well placed to offer significant returns for shareholders. No wonder Investors Chronicle has MTR as a share to watch in 2020 and MTR’s CEO has bought 2.5m shares in the business in the last few weeks.

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