After reading Two posts on Raging bull ( ragingbull.com ) and ( ragingbull.com )|
It has just dawned on me with the talk of the spot prices of tropical hardwood logs doubling to tripling($500-$700 US a log vs $250 US), that although this company reports the conservative value of their acreage, they don't report the reserve of the natural resource that these lands contain! Don't oil companies, gold mining, and other natural resource companies do this?
We old timers on the boards remember the value of an acre of rain forest land.
From this link: rain-tree.com "The latest statistics show that rainforest land converted to cattle operations yields the land owner $60 per acre and if timber is harvested, the land is worth $400 per acre. However, if these renewable and sustainable resources are harvested, the land will yield the land owner $2,400 per acre."
We all applaud Madera's ecological harvesting of their land, and the addition of the herbs and other harvestable resources. At the time these valuations were made, lumber was half the price!
~$30 an acre is just the land. They are asking $180 an acre selling price.
But, Reserves are closer to $3000 an acre! This is a small company, but can anyone tell me why they don't report estimated reserves of $2.3 BILLION on 780,000 acres of land? ($3000 x 780,000). $26 a share!!!!
Unlike OIL or GOLD reserves, these are renewable resources!!! They will last a LONG TIME!!!
Someone call Ray or the Accounting firm and ask what I'm missing!
On another note, why does anyone ask who would buy this land? On my recent trip to Sao Paulo, Brazil, (The 5th largest city in the world 22 million pop.) I saw a city that sprawled for 50 mile in both directions. Skyscrapers and high rises everywhere. Every major corporation in the world was apparent. It is a land of the rich and poor, but let me guarantee you, there are plenty of RICH!! Take the money out of the country? The corporations are quickly moving it in. Why else was I there, with first class airline tickets at $5000 a pop?
This stock is WAY UNDERVALUED and I suspect that as people understand these numbers, we will see great growth in the share price.