GORO Gold Resource Corp $1.60s Officially Very Cheap! Great tax loss buy. Trading at a 9 year low an an EV near $75M
Just reduced their sector leading dividend and shareholders sold off.
If their right, GORO is dangerously struggling with staying even and paying the bills and has a great chance at sliding backwards.
The contrarian view! Gold resource declares this in todays release:
The Company remains primarily focused on its producing Arista mine in Mexico but also aims to reallocate capital to its recently optioned Gold Mesa, Nevada exploration effort. Gold Resource Corporation is evaluating a 2016 drill campaign to test extensions of high grade gold drill intercepts at Gold Mesa, with a goal of defining a near surface, high grade open pit or pits
Operationally GORO has not been hitting home runs lately but are making huge progress in setting up positive catalysts. GORO is producing about 80K ounces per year. I dont think they see pushing more marginal Arista ounces through the mill just to make a few dollars, as the best use of their time and money. About 1 year ago they doubled their production capacity from cash flow and still have capacity for about another 40k ounces per year.
Positive catalysts Going forward:
1)Switchback area 450 meters from the mill. Ramping over now Should be pulling development ore first half of 2016 that will add CF
2) Restarting the leach circuit from 2 sources. July 30, 2015 – GORO) announced high-grade drill results from three of its six properties within its Oaxaca Mining unit. The Company is also progressing towards 2016 mill feed from Alta Gracia and an Aguila mill agitated leach circuit startup. 2gpt Au plus 600gpt Ag in the same intercept.
3) On the exploration side, they are pushing getting cheap propertys with high grade, potential heap leach production supply, from Nevada. With a low CAPEX heap leach operation and some cash flow, This could happen soon with more exploration success. I think the Reids would love to make this work in their back yard and become a multi project company.
Checkmate28
