MPVDF - Mountain Province Diamonds Looks Cheap But It Has Liquidity Issues
- The company owns 49% of Gahcho Kué, which is the fifth-largest diamond mine on the planet.
- Diamond prices have been soaring as COVID-19 restrictions are lifted, which helped the company book a net profit of $19.2 million in Q1 2022.
- However, Mountain Province Diamonds has liquidity issues as it has $299.9 million in senior secured notes maturing on December 15.
- Even if the company avoids insolvency, there could be significant stock dilution as a recent credit facility deal came with the issue of 41 million common share purchase warrants.
- I might consider investing into Mountain Province Diamonds once the senior secured notes issue is out of the way.
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Mountain Province Diamonds Looks Cheap But It Has Liquidity Issues