Gold and Silver miners (Jr and Exploration)

[mcokpba]

I have been looking for a current list of orphan stocks. Quality gold and silver miners that are considered undervalued because they are not on any Gold or silver ETFs. Yes, I realize that just because a stock is not listed on an ETF does not make it automatically undervalued based solely on that factor.

I did find this March 2017 list of frugal miners from investment firm US Funds.

Finding Frugal Miners

As active managers, we try to do the same. Like Beane, we use a host of quantitative, top-down and bottom-up factors to help us find the most undervalued precious metals and resource stocks.

One such factor, low SG&A-to-revenue, I shared with you back in September. “SG&A” stands for “selling, general and administrative expenses” and refers to the daily operational costs of running a company that are not related to making a product. It stands to reason that a company with lower-than-average expenses relative to its revenue might have wider margins than a company with oversized expenses, but few investors look at this metric outside of quants.

Using this factor, we found 10 names whose average returns in the first quarter of 2016 amounted to a phenomenal 88 percent—nearly double what the Market Vectors Gold Miners ETF (GDX) returned over the same three-month period.

Top 10 Gold Names Based on SG&A-to-Revenue
click to enlarge (mcokpba Edit - Sorry unable to cut and paste chart - see link below)

Of course, a company must meet several other factors before it qualifies for our models, but this is just one example of the type of rigorous quantitative analysis we conduct.

http://www.usfunds.com/investor-library/frank-talk/disrupt-or-get-disrupted/