$0.26
$22.16
bear $0.26
base $7.89
bull $22.16
margin of safety $2.50
market price* $16.24
McEwen Inc. owns two gold mines it runs itself, Gold Bar in Nevada and the Fox Complex near Timmins, Ontario, plus two stakes that matter more to its value than the mines do: 49% of the San José silver-gold mine in Santa Cruz, Argentina (operated with Hochschild Mining) and 46.3% of McEwen Copper, which holds the Los Azules copper project in San Juan, Argentina. McEwen Copper was deconsolidated in October 2023. What the mines earn. Measured as the cash left after exploration, stock compensation and the spending needed to keep mines running, the wholly owned business lost money in every year from 2017 to 2025, about $459 million in total, and lost roughly $29 million in each of 2024 and 2025. Its output has fallen from about 89,000 gold-equivalent ounces in 2023 to 57,600 in 2025, and in August 2026 management cut Gold Bar's 2026 guidance to 30,000-33,000 ounces from 39,000-43,000 after less ore reached the heap leach pad than planned, while raising Fox. Costs of roughly $2,500-2,750 an ounce all-in, plus about $20 million of corporate expense and $10 million or more of exploration, mean the mines only make real money when gold is above roughly $3,900. Gold Bar's reserves (168,000 ounces) support about five more years; the Stock mine at Fox, already under construction with $52 million spent, has a stated life of 8.5 years. We anchor on 2024 and 2025 only, because the 2023 deconsolidation of McEwen Copper changed what the company is; earlier years carried that project's spending. The cash loss was essentially unchanged between those two years (about $29.4 million and $29.0 million), and our first year assumes no improvement from the mines beyond the Stock mine's completion. What changed since our last look. San José paid McEwen $58.2 million in dividends in the first half of 2026 (including $49.4 million in May), against only $2.2 million in all of 2025, which confirms that this stake produces real cash. Gold Bar's cut is a setback. Earlier figures were built on a different basis and are not comparable, so we do not compare them. Debt. McEwen owes $110 million of 5.25% convertible notes due August 2030 (convertible at $11.25 a share) and a $20 million 9.75% term loan owed to an affiliate of chairman Rob McEwen, repayable $1 million a month from January 2027 with the balance due August 2028. At June 30, 2026 it held about $79 million of cash, $13 million of marketable securities, a $20 million Paragon Advanced Labs stake and a $16 million loan to McEwen Copper, so net debt is close to zero. Base case, about $7.89 a share. Gold averages $3,500, roughly what the company realized across 2025 and below today's realized price near $4,450. Gold Bar runs out its reserves by 2031 and Fox produces 22,000 ounces a year until the Stock mine's stated life ends in 2035. San José delivers about 56,000 attributable ounces a year for five years, then declines 8% a year to nothing by 2041, paying out about $25 million a year after Argentine taxes. The mines, after corporate costs, the roughly $35 million still needed to finish the Stock mine and about $46 million of reclamation, are worth about negative $115 million. San José is worth about $201 million and the McEwen Copper stake $400 million, which sits between its $274 million book value and the roughly $457 million implied by outsiders' October 2024 purchase of McEwen Copper shares at $30. That gives a business worth about $486 million; add $128 million of cash and investments, subtract $130 million of debt, and about $485 million remains for 61.4 million shares. Growth credited: only the Stock mine. Left out: the Grey Fox project (980,000 ounces of reserves, a June 2026 study extending Fox's life to 2041, but unbuilt and unfunded), management's target to double output by 2030, new discoveries, and any value for McEwen's 1.25% royalty on Los Azules, because the mine has not reached a construction decision. Bear case, about $0.26 a share. Gold falls about 44% from today's level to $2,500, as it did from 2011 to 2015, for four years, then recovers only to $3,000. Gold Bar stops after its first year, Fox loses money at $2,500, and San José, whose costs are near $2,750 an ounce, pays nothing for four years. Corporate costs are cut but the mines still burn about $20-30 million a year, which uses up the cash before the 2030 note maturity. McEwen would have to sell or dilute its McEwen Copper stake into a weak copper market, which we value at $150 million. The business is worth about $18 million (the mines about negative $187 million, San José $55 million), cash is $128 million and debt $130 million, leaving about $16 million. Bull case, about $22.16 a share. Gold holds at today's realized $4,450 for years. Gold Bar produces about 30,000 ounces a year until its reserves and nearby resources run out in 2032, Fox 25,000 through 2038, San José 58,000 attributable ounces for six years, and the stakes are worth more: McEwen Copper $600 million and the Los Azules royalty about $200 million as construction proceeds. The business is worth about $1.47 billion; the notes convert into shares, so only the $20 million term loan is subtracted, and the result is about $22.16 on 71 million shares. Accounting judgements. Income McEwen books from San José and losses from McEwen Copper are non-cash, so only dividends are counted. Mineral reserves are a wasting asset, so every case assumes the mines end rather than continue forever. Exploration is charged only to the extent it sustains the production we credit. How we arrived at the margin-of-safety price of $2.50. We are fairly sure of the cash San José can pay at $3,500 gold, about $0.41 a share a year, but not sure of the mines, which swing from losses to profits on gold price alone, and the stake in McEwen Copper is pre-construction, with no cash flow and no market for it other than outside investors' 2024 purchase. The worst plausible outcome is a long gold downturn that leaves the notes unaffordable in 2030; the structure would survive only by selling McEwen Copper at a poor price, and the chairman, a large shareholder, is also the term-loan lender and could shape terms. If we are wrong on McEwen Copper being worth half our figure, the shares are worth about $4.60; if gold averages $3,000 rather than $3,500, about $3.50; if both, about $0.30. The price assumes a holding period of five years or more, during which San José's dividends are the main payment. At $2.50, San José's dividends alone would equal a large part of that price over six years, and the price gives little weight to the mines and McEwen Copper.