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Silver is up nicely today. We may be setting up for the perfect storm tomorrow. We should see the first shares purchased by the company tomorrow.
I have confirmed with IR that the share buyback will begin Tuesday and they will buy as many shares as possible. They are allowed to buy 22,000 shares per day plus block trades. I'm not sure what constitutes a block trade. They have also confirmed that the AMEX application is more than 95% complete and the AMEX listing is still on target for around March 1.
Does anybody know if Canada is closed Monday or will they be trading? If they trade I wonder if that will count toward the twenty days? After today, it will be 15 down and 5 to go.
Explaining the buyback. The company can only buyback about 30,000 shares per day, not including block trades. I'm not sure how much is considered a block trade. They announced up to 3M+ shares because that is 5% of the total shares which is the maximum they could buy in a year. They very well might not buy anywhere near that many shares if the stock goes up. The point is that this is a huge threat to any shorts and anyone that was trying to drive it under $2. They have a constant bid from the company staring them in the face. USSID recently issued 1.4M options at $2.65. If they could but back 1.4M shares at $2.15 they would cancel out those shares. If the stock went up and the options were exercised they would compensate their management without diluting the shares and they would make $700,000. I'm hoping they won't be able to buy that cheap for long.
It is true that there hasn't been much short selling in the past. That doesn't mean there hasn't been some in the last two weeks. A lot of people hate reverse splits and would short thinking it meant the company was having a problem. It will be interesting to see if short interest increases this month.
Easy answer to that. They would be shorting because they believe they can drive the price under $2 and destroy the AMEX listing. That would cause more selling and maybe drive the stock to $1.75 or so where they could cover. It's interesting that volume was very high all morning and now there hasn't been a single trade in almost an hour???
Volume is heavy today again(about 70,000 shares on both exchanges as of 11:00Am). Most of these have been big block sells. I continue to believe that someone is shorting the stock. The good news is that there seems to be a lot of bids at $2.05. The $2.05 bid has been there all morning no matter how many shares sell. It is possible that someone has drawn a line in the sand at $2.05. Maybe someone is willing to buy all the $2.05 shares that are for sale. I'm not sure about an AMEX ruling on having a share buyback. I haven't heard of one. Even an announcement that a share buyback was coming would make a big difference. Yesterday we traded about 450,000 shares between the two exchanges. That equals about 4.25M of the old shares. Thats way above average trading. Thjere is a war going on between shorts that want to close under $2 and those that want the AMEX listing and are willing to buy at $2.05. JMHO
There are two people that could end the assault on $2 in one minute. One is Eric Sprott and the other is the board directors of USSID. Sprott now has about 8M shares. By adding 1M more shares in the next eleven days he could assure that the stock would not hit $2. By simply announcing a stock buyback, even if it was modest the PR would likely attract a lot of buying into USSID.
I just sold another stock and made a modest purchase. This is a gift with these panicked Scott Trade sellers bailing for no reason. If everyone will do their part and buy a little we can waether this storm. The Scott Trade sellers shoould be out by tomorrow. Volume is now 85,000 for today. Getting rid of these weak hands is positive for the future. After today there are only 11 more trading days to the AMEX.
The only positive news I know of that might be coming is the reserve report which I was told last week is a month away. I agree that this weakness is being caused by Scott Trade customers who were frustrated when their shares disappeared and decided I'm dumping this as soon as I can get out. What's needed here is for existing shareholders to buy as much as possible now to put support under the stock. The 20 days will be over soon and the AMEX listing should happen. Once these Scott Trade investors have sold we could see a quick move up.
Many people hate reverse splits. There was bound to be some that wanted to bail after the RS. We mat see some continued selling until the AMEX listing, but the AMEX should change everything. The weak hands will be gone and a whole lot of new people will be coming in. JMHO
I expect USSID to report revenues of $102M and pretax profits of $28M on March 31 for 2011. After tax profits should be about $19M or .28 per share. In 2013 I expect the following results based on 3M ounces produced and an average silver price of $40. Revenues of $134M with pretax profits of $53M, after tax profits of $35M or .53 per share. Each $1 up or down on silver results in a .03 + oe - change in EPS JMHO
JMHO, but I believe the main reason for the RS and AMEX listing is to get the stock up to better position it for a buyout. 18 months ago I was told that the company had no plans for a RS and AMEX listing. After Sprott got involved that changed. Suddenly the company cared about it's share price. Yes! The stock is now only $2.40, but will it still be after the AMEX listing? I expect Sprott to be the key figure in the buyout. Will it be Hecla? Will it be Sunshine? Will it be someone else. Are Hecla and Sunshine really not interested in 3M ounces+ per year and 50-100M ounces of reserves for a few hundred million? It's pretty hard to think that nobody's interested.
Ameritrade allows margin on any stock above $2 when listed on the AMEX> I have had Ameritrade for 20 years. They are great.
I spoke to IR and they say that Mr. Parker simply retired. He is still on the board. They expect the reserve report to be ready in about a month just as the AMEX listing happens. USSID should be eligible for the AMEX beginning on February 27. They could start trading any day after that. Wouldn't it be great if they could release the reserve report on the first day of AMEX trading?
I'm surprised that the production estimate is only 2.4M ounces. Hopefully, they are being conservative. Production from Coeur is expected to start at the end of this year and full production should be reached by the end of 2013. I guess the Hecla miners are going to be used to work on the Coeur mine.
Volume is quite heavy on the Toronto exchange. It is about 150,000 shares so far which is equal to about 750,000 of the old shares. There was no symbol change there. Some people are probaly confused about the symbol change from USSIF to USSID and are not trading much yet on the U.S. exchange. Today marks day one of tradin above $2. Nineteen more trading days above $2 and the AMEX listing is ours. I am particlarly interested in how USSID plans to use it's 13+ experienced new miners from Hecla. I smell an increase in production this year and I believe 3M ounces is entirely possible this year. JMHO
I doubt that Sprott will allow shorts to drive the price under $2. He has too many shares to allow the AMEX listing to be derailed. A few hundred thousand share buys here and there should take care of that problem. Now that there are only 62M shares outstanding we should expect volume to drop to around 100,000 shares per day.
I find it interesting that USSIF says it is working in cooperation with Hecla to hire it's workers away. If Hecla is going to reopen Lucky Friday next year they will need those workers back. If they buy USSIF then those workers will still be theirs. They can use them to develope the Coeur mine this year and then transfer some back to Lucky Friday next year. A takeout of USSIF makes a lot of sense for Hecla. What would be the price is the big question?
USSIF is no longer a penny stock with way too many shares outstanding. In just a few hours USSIF will be a stock with 62M shares outstanding selling for near $2.50 per share. Ameritrade allows it's customers to buy stocks on margin if they are above $2. Based on the current silver price USSIF is now earning about $5M per quarter after taxes or about .08 per share every quarter.
13 new hires of trained miners from Hecla will mean higher production and a likely acceleration of the Couer developement. JMHO
Once the post split shares start trading USSIF must trade above $2 for twenty consecutive trading days to get an AMEX listing. We should see AMEX trading begin at the beginning of March IMHO.I would expect Sprott to intervene to make sure the stock doesn't drop below $2. On another note. 10.5M of USSIF options are out of the money. They are at prices ranging from .53-1.19. These options may never get exercised. We are looking at about 66M fully diluted shares after the split. At $32 silver USSIF earns about $4.5M net profit or about .07 per share per quarter. Earnings for the year would be about .28 per share.
I agree that it is a small piece, but it is an important piece. He pretty much has control over USSIF now and can dictate policy. I also expect USSIF to start holding back silver because I believe that Sprott wants that. USSIF will probably play an important role in Silver Valley consolidation in 2012 and Sprott will likely be involved. JMHO
I wonder why Sprott doesn't purchase a million or so shares to get the price back up near .50 so that the R/S and AMEX listing can move ahead? It almost looks like it is being held back so the R/s and AMEX can't move ahead. Is a buyout offer in the works and they don't want the AMEX to happen? In the meantime the fundamentals continue to be great. At $32 silver USSIF makes $10 per ounce or about $6.5M pretax each quarter. Cash is still building and reserves should be way up. IMHO something big is going on behind the scenes. I will be surprised if USSIF is not taken out this year.
I think that once they announce the reverse split that the stock must trade above $2 for twenty consecutive trading days. They could announce the reverse split before the approval, but they risk the stock going under $2 if the announcement is made separately. I expect a combination announcement of the R/S and the AMEX approval at the same time. That way everyone understands the reason for the R/S and it becomes a positive rather than a negative. If the announcement comes this week or next we should be trading on the AMEX by mid-February.
Endeavour Silver is holding back 60% of it's production this quarter due to low silver and gold prices. Sprott has asked silver companies to do this. I wonder if USSIF will do this? It hurts current revenue and profit numbers, but sets up huge gains in the future. It also defers income taxes as profits are pushed down the road. If many silver companies do this it could create quite a silver shortage. I just bought some Timmons Gold(TGd). They just announced huge production increases. They should earn between .40-.50 per share in 2012 and sells for $2.03. I am 50% USSIF, 25% TGC and 25% TGD. Just waiting for AMEX listing like everyone.
Silver is down about 40% from it's high of $50 and USSIF is down about 40% from it's high of about .83. USSIF is tracking the price of silver. If you like silver you're going to love USSIF.
We are forgetting that the silver price is way down from it's highs. The breakeven point for USSIF is a $21.50 silver price(650,000 X $21.50 = $14M in revenues). Total expenses minus hedging losses are $14M after subtracting $3M for byproducts. At $21.50 silver USSIF breaks even. For every dollar that silver is above $21.50 USSIF makes $600,000. At $32 silver USSIF is currently making about $6M per quarter or $4M per quarter after taxes. That is .05 per share per year. At $42 silver USSIF profits would double from current levela. We MUST have a higher silver price if we want a seriuos move up in USSIF. $16M a year in net profits per year is nice, but $32M is a lot nicer. Lets stop blaming the USSIF price on management and blame silver prices which is the real culprit.
I applaude your efforts in Haiti and I hope USSIF does everything you are expecting it to do. Regarding Christmas, as a Christian I do not celebrate Christmas. Christmas is a Pagan holiday and the Bible comes out strongly against celebrating man's traditions. If anyone wants to discuss this issue with me privately you can EMail me at firecracker7445@aol.com. Mark 7:6,7 Jeremiah 10:1-8 What we really need to watch concerning USSIF is events in the mideast. All out war between Israel and Syria and Iran may be days or weeks away. How is this going to affect silver?
Keep in mind that volume recently has been almost nil. The big differences in bid/ask happens when there in no volume. The market makers take advantage of the small volume to keep a wide spread. The amount of money traded in USSIF is only a few hundred thousand dollars per day. This is pocket change. The reason for the low price is a total lack of buying interest. If there was any buying interest the stock would quickly move up. The RS and AMEX listing is the only solution to the problem. We simply MUST wait until the final approval comes from the AMEX. When that happens there will be a dramatic increase in volume and exposure. Lets face it. Other than a tiny number of people NOBODY ever heard of United States Silver. MANY people ABSOLUTELY WILL NOT buy a stock under $1 and a pink sheet stock. This is all about to change. Hang on and find something to keep you busy for a few weeks instead of driving yourself crazy worrying about a timetable that you can't control. JMHO
If the RS announcement was made prematurely you would even risk driving the price of USSIF below $2. The RS would be looked at negatively and many would believe the AMEX listing wasn't going to happen. The RS announcement could actually delay the AMEX listing by keeping the stock under $2. USSIF might even need to consider an additional RS which would be a disaster. Personally, I believe the RS/AMEX combo announcement will be taken very positively by the market. The waiting is frustrating, but I believe it is necessary. I want to see the announcements made at the same time. JMHO
I think that US answered our question for us. The company said they want to announce the RS on the back of good news. That makes a lot of sense. An announcement of a RS with no other news has a negative connotation. If you have a two or three month lag between the RS announcement and AMEX announcement the stock could get hammered. It makes sense to wait until the AMEX listing is approved pending the 20 day above $2 rule. If you announce the RS and at the same time announce the AMEX listing is tentatively approved you turn a negative announcement into a positive announcement. Everyone understands your reason for the RS and sees it as great news. If management wanted the share price down they could easily accomplish that by announcing the RS with no mention of an AMEX listing. IMHO the delay in the RS is tied totally to the delay in the AMEX approval. Do you really want the RS announcement prematurely so you can watch your stock get hammered? If you have dry powder you might want that. The fact that management is holding the RS to couple it with the AMEX announcement tells me that they want the stock price higher. JMHO
People seem to forget that the fall doesn't end until December 21. We have more than 3 weeks until USSIF misses it's pledge to do the RS in the fall. People don't understand the regulations that are involved in getting an AMEX listing. The company sends in information and the AMEX asks for more. The auditors need to be consulted, etc. I don't believe that the company is doing anything to slow down the AMEX process. It just takes a lot of time. I would like to see the company respond quicker to shareholder's questions. Regarding production: production was about 550,000 ounces in quarter 1, 650,000 ounces in quarter 2 and 650,000 ounces in quarter 3. In the CC the company stated that production in quarter 4 should be about the same as quarter 3. Full year production should be 2.5M ounces. There are no problems regarding production. There are no problems regarding revenue or profits. The only problem is regarding exposure of the company's stock to new investors. The RS and AMEX listing should fix that. I've been waiting all year and I have no plans to sell anytime soon so I don't mind waiting a few more weeks. Congrats to those that have cash to buy at these prices.
You can call Heather at 208 752-1116 Ext 221. I have called her before and she has talked to me.
$23 silver is the breakeven point for USSIF. With the hedge gone USSIF makes about $9M when silver is $35 as it did in quarter 3, excluding the hedge. With 700,000 ounces of production USSIF expenses are about $19M per quarter without the hedging loss. When you back out $3M for byproduct revenues that means $16M in silver revenues is what's needed to break even. That comes out to about $23 per ounce. USSIF currently pays about $1M in profit sharing payments per quarter. Profit sharing added about $1.50 per ounce to cash costs in the last two quarters.If silver was $23 the profit sharing would stop and expenses would drop by another $1M. The way to compute USSIF quarterly profits next year is to figure about $750,000 for every $1 that silver is above $23.
Looking at 2012. Keep in mind that USSIF took a $1.6M loss on hedging during quarter 3. Without hedging USSIF would have made about $9M pretax and $6M aftertax. USSIF expects 2012 expenses to stay about where they are. I am expecting 2012 production to average 700,000 ounces per quarter. With $35 silver we can expect revenues of $27.5M and aftertax profits of $6M without hedging. Every $1 move in silver adds or subtracts $500,000 in aftertax profits. Here is a recap of what to expect from USSIF during 2012 based on different silver prices on a quarterly basis. $30 silver = $24M in revenues and $3.5 in profit or .05 per share, $35 silver = $27.5M in revenues and $6M in profits or .09 per share, $40 silver = $31M in revenues and profits of $8.5M or .12 per share, $45 silver = $34.5M in revenues and $11M in profits or .16 per share and $50 silver = $38M in revenues and $13.5M in profits or .20 per share. It is quite clear that it all depends on the silver price in 2012.
The reason that revenues and earnings were higher than I expected was that USSIF sold 705,462 ounces of silver in quarter 3 while they only produced 645,543 ounces. Revenues are based on ounces sold. USSIF announced that they have locked in a settlement price of $33.13 on their remaining hedges. That means they are assured of a $900,000 hedging loss in quarter 4 compared to $1.6M in quarter 3. USSIF basically is no longer hedged. USSIF had $12M in receivables at the end of the quarter.
I'm surprised that cash is only $27.5M. Perhaps they had a lot of accounts receivable at the end of the quarter? I'm also surprised that revenues were that high. It looks like TTM twelve month earnings will now be about $18M or about .27 per share after the split.
There is a big difference between not providing production numbers and not providing production estimates. I don't think there are many silver companies that provide quarter by quarter production estimates in advance. USSIF has stated over and over that they are on target to produce 2.4M-2.6M ounces of silver in 2011. We know they have produced 1.2M ounces for the first half of the year so we know they are confirming 1.2M-1.4M ounces for the second half of the year. There is one thing they don't do that many other silver companies do. Many silver companies preannounce their production numbers for the quarter about 15 days after the quarter ends. That takes a lot of the speculation about the quarterly report away. If you know the actual production numbers for the quarter 30 days before the report it is easier to try to guess what kind of quarter you will have. That information would be far more important to me than speculating on production in advance when you don't know what grades are going to be.
Why do people think that USSIF management isn't providing production numbers? The only thing they said they won't do is to forecast production on a quarter by quarter basis. That is because quarterly production varies and they don't want to overpromise for a quarter and cause disappoinment. They are only giving forecasts for the year and they are on target to meet that forecast. They are still giving actual production numbers and ounces sold numbers for each quarter. 2nd quarter they prodiuced about 650,000 ounces and sold about 750,000. Someone said they talked to Heather and she said 3rd quarter production should be about the same as 2nd quarter.