The Mining Valuation Handbook: Mining and Energy Valuation for Investors and Management, 4th Edition
by Victor Rudenno
Chapter 11: Valuation methodologies
Valuation techniques can be divided into two broad categories:
• Fundamental — where the underlying ‘fair’ or ‘intrinsic’ value is derived by such methods as discounting future cash flows to the present time.
• Technical/statistical/graphical — where most commonly historical charts are used to predict a potential change in value or share price, or both.
A resource company’s primary asset is the opportunity to extract its ore reserves and mineral resources. The most representative way to calculate this value is by using a discounted cash flow (DCF) methodology, which measures the net present value (NPV) of future cash flow streams under specific commodity-pricing and operating cost assumptions.1 The net present ...
Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.
Read now
Unlock full access