DD Support Board and Research Team

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A new kind of pump.
GOLD STOCK PICK OF THE MONTH
The Birth Of A Billion Dollar Gold Company
By: Andrew Carpenter - Jan 18, 2012


INVESTMENT HIGHLIGHTS:

Company name: Sagebrush Gold (SAGE) - 52 week range: $0.43 - $3.00
Legendary Billionaire investor, Phillip Frost, just purchased a huge piece of the company at $.50 a share
The stock has recently sold-off down near his investment price of $.50 a share
Rare opportunity to invest alongside a Billionaire
The Chief of U.S. Operations for Franco Nevada, a $4.7B dollar Gold company, just signed on as their Senior Consultant
SAGE just closed on a $20 million dollar Gold processing plant
SAGE's lead Geologist has led teams that have discovered over 15,000,000 ounces of Gold worth over $11 billion dollars at today's prices
SAGE controls one of the largest pieces of a very prolific Gold trend in Nevada surrounded by Barrick Gold ($44B market cap), Newmont Mining ($25B market cap), Allied Nevada ($3B market cap) and Paramount Gold & Silver ($480M market cap)
SAGE just announced that they have contracted a second drill rig at the Relief Canyon Mine Project. The second drill rig was added to accelerate the Company's previously announced exploration program at the Deep North Zone and expansion of current resources in, around and underneath the existing pits at Relief Canyon where current NI43-101 gold resources are hosted.
Recently, European leaders finally decided on some kind of plan to lift Europe out of an almost two year old debt crisis and investors voraciously bought up stocks and gold.

Martin Murenbeeld, chief economist at DundeeWealth, still thinks that the European Central Bank and the Federal Reserve will be forced to pump more money into the system to stabilize their respective economies.

"The more liquidity that is put in the system, the higher goes the gold price," he said. Murenbeeld also says the U.S. dollar is fundamentally weak, which means central banks might want to diversify out of dollars into gold. That trend has already been seen as central banks have become net buyers of gold rather than net sellers.

So we have turned our attention to this sector for our "Stock Pick of the Month" column and have found what we feel is an unbelievably undervalued stock for our readers!

The company is called Sagebrush Gold (Nasdaq OTCBB: SAGE) and it currently trades for around $.50 cents a share, near its 52 week low. This just happens to be the same price that a Billionaire named Dr. Phillip Frost invested in according to this 8-K filing, which states: "Each share of Preferred Stock is convertible into shares of Common Stock at a conversion price of $0.50 per share…"

Here is a snippet from their latest shareholder release:

"Our Company has attracted funding that will enable us to complete multiple phases of our exploration program. Legendary investor Dr. Phillip Frost (Chairman of Teva Pharmaceuticals, Inc. (Nasdaq: TEVA), Ladenburg Thalmann & Co. (AMEX: LTS), OPKO Health, Inc. (NYSE: OPK) has invested $5 million in our subordinated debt and convertible preferred stock. Additionally, two European institutional investors increased their investment in the company by an additional $1.5 million in equity financing bringing their total investment to over $5 million."

How often does the average retail guy get a chance to invest alongside a legendary Billionaire investor like Dr. Frost? The answer: Not many...

A stock selling off down to the investment price of a Billionaire is a rare opportunity for the "Average Joe" to position accordingly.

His latest venture, OPKO Health, Inc. (NYSE: OPK), just graduated to the NYSE and has gone from $1.80 a share to over $5.40 a share within the last year. So we might be finding out about Sagebrush Gold (Nasdaq OTCBB: SAGE) at the right time.

Sagebrush Gold is a fairly small junior gold explorer that is just getting their feet wet in the mining space, but by accomplishing what they have in such a short time, makes us think that there is much more to the story than meets the eye.

And when junior explorers have something brewing, they don't just gain 50%-100%... they skyrocket with gains that are extraordinary.

Doug Casey, a world-renowned gold authority, recently told investors in Toronto that gold is ready for a SUPER BUBBLE and if you find the right junior gold explorer, its value could grow by 10-fold or even 1,000-fold. This is exactly what he is referring to:
In early 2009, ATAC Resources' (ATC.V) shares were trading for around $.23 per share. In July of 2011, it was trading for over $10.00 per share for a potential gain of over 4,200%.

In late 2008, Nevsun Resources' (AMEX: NSU) shares were trading for around $.30 per share. By late 2010, it was trading over $7.00 per share for a potential gain of over 2,200%.

In late 2008, Ivanhoe Mines (Nasdaq: IVAN) was trading at around $1.88 per share. By late 2010, its shares were trading around $30 per share for a potential gain of over 1,400%!

This is what excites us about Sagebrush Gold. On top of closing a legendary Billionaire as a key investor, they also recently brought on board the Chief of U.S. Operations for Franco Nevada, a $4.7 billion Gold company, as their Senior Consultant.

What piece of the puzzle do these giants know that the public doesn't that motivated them to get involved with a junior like Sagebrush Gold? That's what we need to keep asking ourselves.

Another piece of the puzzle was the recent purchase of a $20,000,000 Gold processing plant at Relief Canyon near Lovelock, NV on August 31, 2011. There was a property that came with the plant that has indicated resources estimated at 155,000 ounces of gold. When processed, that could yield as much as 98,000 ounces of pure gold, giving it a market value of about $100 million, based on $1,700 gold.

This represents what's in the ground now and doesn't include other potential deposits that could be found in the future after further drilling.

Earlier this month, Sagebrush announced that they have commenced Phase One drilling on the Relief Canyon Gold Project. The Company plans to conduct up to 18,000 feet of core drilling to test the North Deep target, located approximately 1/2 mile to the north of the existing resource at the Relief Canyon Mine.

Company Chairman Barry Honig commented, "We are excited to have started Phase One drilling at the Relief Canyon Gold Project and are especially pleased that we were able to begin the first stage of an extensive drill campaign less than one month after closing the acquisition of Relief Canyon. As previously stated, the Company hopes to add shareholder value by increasing our gold resource and we believe that we will be able to do so at Relief Canyon."

They have another property called The Red Rock Gold Property located in the Mt. Springs Mining District, Lander County, Nevada. (Map to the right) They control one of the largest claims in this potentially gold-rich land in North Central Nevada. The area is known as the Cortez District in the Battle Mountain-Eureka Trend, which is Nevada's second largest gold zone.

This particular property is the largest in the area and is surrounded by huge international gold producers like Barrick Gold ($49B market cap), Newmont Mining ($32B market cap), Allied Nevada ($3.5B market cap) and Paramount Gold & Silver ($480M market cap).

Last but not least, their lead Geologist has led teams that have discovered over 15,000,000 ounces of Gold, which would equate to over 11 billion dollars worth of gold at today's prices.

All of this is extremely profound when it comes to a junior exploration company like Sagebrush, which leads us to believe that something is going on here or else these big wigs wouldn't be getting involved with the company.

Do they know something the public doesn't? Could Sagebrush potentially be sitting on a big vein of gold on one of their properties? Did they buy the gold processing plant because they know they are getting ready to process a bunch of gold? What is it that has these big players jumping on board?

Whatever it is, it deserves our coveted "Stock Pick of the Month" award and further due diligence for any serious investor.

Could they be the next ATAC Resources? Nevsun Resources? Or Ivanhoe Mines?

You never know, but the cards that are being dealt are very convincing and that's what we like to see when looking at junior explorers like Sagebrush Gold (SAGE).

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