The report was authored by Jim McFadden who has worked as an equity analyst and portfolio manager on Wall Street for more than 25 years, first as Institutional Investor-ranked utilities analyst with Bear Stearns and Goldman Sachs and then as a long-short portfolio manager with hedge funds such as Amaranth Advisors and the Bass Brothers. In addition, he headed JP Morgan’s North American equity proprietary trading desk.
In the report Mr. McGadden States:
“BKI’s (Black Iron) current EV (enterprise value) of US$9 million seems far too low given the economic opportunities described… given BKI’s tremendous economic opportunities, the company should currently trade at perhaps a US$100 million enterprise value, implying a present fair share price of about C$0.75 per share or US$0.55-US$0.60 per share. Furthermore, as Shymanivske construction gets closer, we think the market will start putting perhaps a 1x multiple on the company’s projected annual EBIDTA of around US$385 million.”