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Firestone Diamonds - sell

Tom Winnifrith
Thursday 25 October 2012

This has been a shockingly bad tip from me from my 12 years running t1ps.com. The shares have popped up today. And so is this still a red hot penny share?

AIM-listed diamond miner, Firestone Diamonds (FDI), has today announced that a definitive feasibility study on its 75% owned Liqhobong diamond project in Lesotho has determined a post-tax Net Present Value at an 8% discount rate of $335 million (£208 million). This is for a 1.2 million carat per annum open pit operation over a 15 year life of mine. Given, at a current 6.125p share price, Firestone is presently capitalised at just £33.5 million ( and has c£4million of debt as well), the shares ostensibly appear to offer strong value – but is this actually the case? In the following I explain why perhaps not.

on TradingResearchPoint | Comments
About Tom Winnifrith
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Tom Winnifrith is the editor of TomWinnifrith.com. When he is not harvesting olives in Greece, he is (planning to) raise goats in Wales.
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