TD Waterhouse has set a target on the shares at $0.15 today BUT it gets worse in their report wherein it states:
"We are unsure if the market will support such a large shortfall"
"We are not convinced that the company will be able to meet the anticipated funding shortfall, but have updated our model to reflect the company’s guidance on its financing assumptions, increased opex and increased capex assumptions, and revised production rates in 2103 and 2014."
(my comment given the huge difference in numbers - do you trust the company guidance? or do you discount it further?)
"....the Kaunisvaara project doesnot make economic sense;the company does not generate enough cash to pay off the bonds in 2017, in our view"
TD's Investment Conclusion in their analysis is:
"The Kaunisvaara project is the closest to commercial production among our junior iron ore peer group. Although the mine is now operating, a lot of shareholder value has been lost in the process, and more could be lost to make up the $425mm funding shortfall. The company will be in financial trouble if the market is unsupportive, in our view. As a result, we are downgrading our rating to REDUCE"
I strongly recommend that you do your own ivestigation of the viability of this company before thinking you are getting a bargain; jumping back in; downward averaging, etc.
Personally' I've set an entry point well below what the analyst guess is. Time will tell.