This board is for discussing junior miners in both base and precious metals. The commodities boom appears to be a longer term issue so these stocks should become more important as investors try to find small companies that are discovering new deposits.
The typical scenario is that the big companies have such high overhead that they can only look for huge deposits. However as commodities rise in price and all producers max out production, the larger players struggle to replace reserves. The junior miners typically fill that role by finding deposits and then selling out to the cash rich bigger players.
My normal investing strategy is to look for profitable stocks with low p/e's. That strategy is difficult with mining stocks because most are not in production or are losing money.
My alternative strategy is to look for miners with near term potential to begin production. Those are the stocks that I will attempt to focus on along with any stocks that are actually profitable.
FAVORITE JUNIOR NICKEL MINERS:
FAVORITE JUNIOR ZINC MINERS:
Zinc prices have underperformed relative to other base metal prices during the commodity boom of 2010-11. There is supposed to be a surplus in supply in the near term but significant shortages could develop over the next few years. Several large zinc mines are slated to run out of reserves during this time period and demand is expected to continue to increase.
FAVORITE JUNIOR COPPER MINERS:
China remains the most important barometer of base metal fortunes. If their economy continues to grow, copper usage and prices will continue to be supported at the current high levels.
Capstone Mining Corp CS.to/CSFFF.pk
F.D. 82.1M, The company is buying back 10% its shares from mid 07-mid 08. Holding ~20m shares of SST.v plus warrants.
Cash cost about 40c copper net byproduct credit, going lower as smelter charges drop in 08 and lead price jumps.
Recently increased its mill output by 120% under budget. Guiding 26 M lb of copper, 11.3M lb of zinc and 4.1M lb of Lead in 08.
New resource update by sep 07.
QUADRA MINING QUA.to/QADMF.pk
S.O. 38.1M + 3.9M (InterMoly) + 12M (PP, fully allocated)=54M
F.D. 42.6M + 3.9M (InterMoly) + 24M (PP, fully allocated)=70.8M
2007 guidance: 125 M lb copper and 60 K oz gold
Q1 2007 production: 36.6 M lb copper and 31 K oz gold. Cost: ~$1.5/lb
Taseko Mines Ltd. (TGB)
S.O. 113.6 M
F.D. 126.4 M
2007 guidance: 60-70M lb copper and 1 M lb of moly. Cost: ~$1.5/lb
Production set to increase to 120 M lb copper and 1.4 M lb of moly in late 2008 and cost will go down to close to US$1.1/lb area.
FAVORITE JUNIOR GOLD MINERS:
FAVORITE JUNIOR SILVER MINERS:
AURCANA AUN.v AUNFF.pk
FORTUNA FVI.to FVITF.pk
Profitable mine in Peru has financed much of the development of their new mine in Mexico. Producing over 2million oz of silver now, targeting 5million+ oz in 2013 when new San Jose mine should be at full production capacity.
SCORPIO MINING SPM.to SMNPF.PK
SILVER WHEATON SLW
Silver Wheaton is the biggest silver streamer. They finance many junior miners by buying future production of silver at fixed prices. The typical price they pay is 3.90/oz. The miner gets needed financing to bring mines into production and SLW gets all or a percentage of their future silver production. Silver Wheaton has financing power that many juniors lack. Now that they have been in business for several years, their initial investment projects are coming into production and raising SLW's production levels. Lower risk way to play silver because of diversification and lack of mining risk. SLW is relatively low overhead. They have a small office staff of finance experts who continue to add deals to the portfolio and production without significantly adding to overhead now and in the future.
FAVORITE JUNIOR URANIUM MINERS:
Worldwide, there are hundreds of nuclear powerplants on the drawing board. The current mining supply is well below current usage. The deficit is being supplied by Russia from deactivated nuclear warheads. That program is going to end in 2013 and Russia has indicated they will retain whatever is remaining of their inventory for their own nuclear powerplant use. As that deadline approaches, there is more and more likelihood that uranium will increase in price.
Strathmore Minerals STM.v STHJF.pk
Near term producer, with two projects being advanced towards production. Strathmore has a JV with Sumitomo to develop Roca Honda in New Mexico and is pursuing licensing for the Gas Hills Project in Wyoming. Strathmore has a large acreage position in the US of prospects that it intends to JV or sell to concentrate on it's core products. These properties were acquired many years ago at very low prices.
Uranerz Energy URZ
FAVORITE JUNIOR MOLYBDENUM MINERS:
FAVORITE JUNIOR TUNGSTEN MINERS:
DYNACOR MINES DYN.to MSDRF.PK
FAVORITE JUNIOR LEAD MINERS:
MontyHigh's blog, quite informative: http://montyhigh.typepad.com/world_of_wallstreet/
A Good web site for juniors: http://miningpedia.com/