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GORO: High Zinc Prices Keep Costs Down.
This is a dr_airtime original observation:
See slides 13 and 45. GORO has a 3.6% Zinc by-product P&P grade which contributed US$ 26M in 2016 revenue as a by-product credit help keep GORO's cash costs/AISC down. By my posts for last year I'm bullish on zinc for next couple years and so are others so this is a nice tailwind that should keep GORO's costs down. You can quickly calculate from slide 13 that based on 14,302 tonnes of zinc production GORO received US$ 1800/tonne in 2016 and prices currently around US$ 2500 tonne. Assume a similar level of production and US$ 2500 flat pricing for 2017 and there is an instant US$ 10 million increase in revenues over last year (or decrease to cash costs/AISC depending on your approach)
http://www.goldresourcecorp.com/content/grc-presentation.pdf
To come from the contrarian point of view - if GORO ever runs out of 3.6% zinc then sell as costs are going to jump materially. This probably isn't a risk but going to go email company now.
GORO: No IVA (Mexican VAT) Issues
Per my post linked one back. There aren't any IVA refund delay issues on GORO's balance sheet (would likely be in AR, not income tax receivable - IVA is a VAT tax).
Here is a short blurb I've found alluding to more systemic issue.
http://www.reuters.com/article/mexico-mining-idUSL1N1D1222
My plan for GDXJ Rebalance Buying
Luke - thanks for the links! Been busy with new job so less time for personal research.
I owned a few of the longer trading days names I've sold out now. Based on the "days to trade" list and also current charts these would appear to be best 'trading' buys. Also have good long term stories too:
ASR.TO Alacer (12 days)
PRU.TO Persues (11 days)
DPM.TO Dundee (18 days)
TGZ.TO Teranga (16 days)
Other notable mentions
Firs Mining Finance (gold project bank) (FF.TO) (20 days)
China Gold (CGG.TO) (20 days). Down 50% in last 3 months. This is a trader.
Based on this Early July (After June 17 rebalancing carnage clears). I would plan to load Teranga and Alacer in that order as big two positions, followed by China Gold as a trader out of summer lows.
GORO only needs 5 days to rebalance so I think it will bottom before June 17, potentially in May at around $3.00 (we're almost there) I don't think GORO will be all the way down to $1.50.
The best TSX/TSSV tax loss buys in mining often bottom before the year-end Dec 23rd tax selling deadline. The GDXJ information is out there and there is a lot of front-running so I would expect this to be the case for some of the names above - especially GORO.
FYI - I talked to a friend in mining industry and all Mexican miners are having huge issues with the Federal Government stretching out VAT refunds to a half-year plus because they are experiencing fiscal issues with low oil price. Going to go check out GORO's balance sheet now and report back in sepearte post. This is a current issues for ALL MEXICAN MINERS so you need to look at receivables disclosures for any of your holdings.
Perseus is an eventual buy at higher gold prices and not going anywhere soon.
Yahoo Mining News Forum Stopped - Alternatives?
NOOOOOO....the Yahoo Mining/Metals archive was the best, so comprehensive and exists no more. Anyone have any alternatives they use? Maybe use marketwired and set up their own mining feed?
This was the former link:
biz.yahoo.com/n/y/y0023.html
This is a discussion thread by equally choked investors:
https://forums.yahoo.net/t5/Finance/What-happened-to-Yahoo-s-Mining-Metals-News-Wire/td-p/223888/page/2
This is the best alternative feed I could find from that discussion but not as good as Yahoo feed:
http://www.baystreet.ca/articles/mining_news.aspx
USA.TO - bought a bunch more today....
...I know everything has sold off but USA.TO bottomed a few months ago and feels set to surge higher perhaps becuase market is figuring out how much Zinc they will produce when San Rafael up and running (50M lbs/year if I remember - this would be nice if zinc goes to $1.50).
Here is the chart. Feeling like only direction is up.
didn't update trendline but if you draw a support line from Feb 16 low the stock is right on it now. I don't think it will break so good buy point IMO of course.
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SSL.TO acquires MARL.V
Huge premium. This could transform SSL.TO going forward. Here is the merger presentation. MARL.V shareholders ecstatic. I'll be looking more closely at Sandstorm long term.
If link doesn't work you may have to start on Sandstorm splash page and click through regulatory stuff as a joint Canada-UK transaction (Mariana had UK listing)
I'll look in more detail later but if you want to buy sandstorm going forward it looks like the thing to do would be to buy Mariana and you may get an exploration spinco spun out for free.
http://www.sandstormgold.com/_resources/transaction/joint_investor_presentation.pdf
Lone Clone - COR.V
1.3% Cu over 100+M is a nice hole (CHR-002 or 'second' drill hole). Were these results actually only the first and second drill holes ever drilled on the property or just the recent exploration perhaps by a new entity?
I skimmed the presentation quickly but trying to figure out if this is a 'low hanging fruit drill pump' or the real deal before spending any time.
Cheers...
Lone Clone - Trevali..
FYI LC - love your comments and they are the most sane and grounded amongst here.
Within 48 months I think the zinc story will be over and the price will have peaked and a number of smaller mines will be back in production, however, the market really needs another world class mine to meet demand shortfall long term. Glencore brining their idled capacity back online would signal the top and the Glencore as a predominatly trading house would be posistioned to profit walking zinc back down in price as the 'Saudi Arabia swing producer' who can somewhat control the zinc market.
I also think Zinc will go to $1.50 before it goes to $1.00 again and I would bargain Glencore is positioned to benefit from this. IMO Trevali will the go-to vehicle for leveraged zinc exposure and I'm looking only at multi-month trading holds and will be completely out in 48 months. 2018 is supposed to be peak pricing from the peak supply crunch. This is a commodity after all.
I would buy Tinka if comes back down to $.50's. As of right now, I liked Trevali and it's looking like it is bouncing off of the 200 DMA and I think yesterday's $1.10 price may be the low for the year.
Contgrats on Tinka FYI that is a huge win!
Trevali - I would guess this:
1) Massive dilution for shareholders at time announced (I was largetly in cash on extended vacation so didn't effect me).
2) Increases Glencore's de facto control with offtakes on all four mines, though offtakes are likely tied to LME spot (Glencore is effectively the OPEC-like 'swing producer' that control marginal cost of production and can move zinc market and hence control it).
3) Even further increases Glencore's control as largest single shareholder with 25% so would be challenging for Trevali to try to renegotiate offtakes in event Glencore tries to screw them.
Zinc is simply a commodity afterall and I'm only looking out to 2018 which is supposed to be peak supply crunch (and Wood Mac forecast peak pricing of $1.80/lb) as a holding period for Trevali. It's basically just a levered play on zinc price.
Despite all this if zinc goes to $1.80 Trevali is going to fly just don't own too much and get ready to sell. Not a long term hold.
TV.TO - another update...
added another $20,000 in TV.TO this morning at 1.16 for family so up to $30k betting we'll bounce off 200 DMA here and zinc and trevali will be materially higher a year from now.
Let's hope I'm right. Will see what I can dig up on zinc market this week.
TV.TO - quick update
I bought $10,000 of TV.TO @ $CAD 1.12 on thursday as hoping it will bounce off 200 DMA at around 1.10.
This happened during the three months I was checked out here. Trevali IS the leveraged zinc price upside play:
http://www.northernminer.com/news/trevali-ceo-discusses-glencore-deal-zinc-markets/1003784876/?utm_source=NMWR1&utm_medium=email&utm_campaign=NMWR1-EN04132017&e=0w3s4u4ss4qW6x08yM2vx
Zinc spot sold off for last couple weeks but LME inventories still dropping. Here is the best link:
http://www.kitcometals.com/charts/zinc_historical.html
LMC.V - Endeavour 2.0 now trading...
...I haven't looked at this one in months but note there is StockCharts symbol now (LMC.V not LMC-H.V which was the venture shell?) and is trading super-liquid-y (700k shares a day) for last week.
This link will probably not work. Put it on your watchlist. Former Endeavour CEO's new company.
http://stockcharts.com/h-sc/ui?s=LMC.V&p=D&yr=1&mn=0&dy=0&id=p03172614915&listNum=9&a=518390342
Huesos - do you own Minera Almos?> EOM
MAI.V - Castle Gold 2.0?
Minera Alamos. $CAD 18M MC, 300k au oz likely oxidized gold started pit @ +2g/t.
Got an email from stockcharts saying they "approved this new symbol" I must have requested months ago as I can't remember which news source/newsletter triggered the request (use stockcharts for watchlists, tracking, etc).
Nice little resources by a management team who started Castle Gold and tried to turn around NWM Mining (not an investment success, but probably challenged). Darren Koningen is they key guy here I beleive.
Anyone follow?
http://www.mineraalamos.com/getsdoc.php?id=49
GORO - agree. Here is my list...
..of best charts I had ready for if gold went past $1275 which is the case this morning of course. All the 'best charts' have good fundamental stories over next few years of course too.
GORO
Asanko AKG.TO (Katusa Resource Opp top pick to be bought out my major)
Detour Gold DGC.TO (double if it returns back to 2016 highs)
MND.TO (old favorite, buy around $.60. Has worked so many times in last 3 years)
NGD.TO New Gold (Has exploded today off of multi-month bottom and is going higher)
Have bought all five this morning FWIW. Coming of an interesting couple months with family, making major job move and then have been travelling in South America now but will be back to being a bit more active here going forward.
I also bought some more Trevali TV.TO this morning at 1.13 with idea that it should have bounced of 200 DMA @ 1.10 in a week's time. Not sure if everyone saw but they have acquired two of Glencore's mines and one is one of the highest grade zinc mines in world (18% if I remember). Zinc inventories at LME continue to drop and current weakness looks to follow month-long zinc spot price correction. Trevali is definitely the go-to name for North American leveraged exposure to zinc price upside.
Gann Webinar - recommend you review.
Start at 29 minutes and see his comparison of potential for gold bull using Corn coming out of the great depression.
http://www.gannglobal.com/webinar/2017/February/17-02-GGF-Webinar-Recording.php?inf_contact_key=38207faeb6e07a9871af83f99bbdf54ac50e11bc8ad86865946f0302a8362496
If you go back 10 minutes you'll see a great feature showing the current S&P/Dow bull is 3rd longest bear market since 18th century and likely to result in major correction in next 6 months.
CNE.TO - Colombia dropping tax to 32% by 2019
Last post on CNE.TO for a while! I just think this is a great buy opp for another double by H1-2019 on the gas contracts alone and oil price upside is a bonus beyond that. Besides...it is so quiet here....
If you recall from 1.5 years ago my concern was that the implementation of CREE tax in Colombia (25% corporate tax plus 14% CREE on top of that for 2017) was a big negative on Canacol long term. Things have change and new tax reform that reduces the tax rate from 39% in 2017 to 32/33% in 2019 (when Canacol actually hits 40,000 boepd) has made the story brighter.
https://home.kpmg.com/xx/en/home/insights/2016/10/tnf-colombia-proposal-for-major-tax-reform.html
http://colombiareports.com/colombias-congress-approves-tax-reform-bid-raise-billions/
CNE.TO - Incredible summary of history on SA
This author's first major article so he put a lot of work in. One of his key points is that most of Canacol's shares are publicly floated so that explains the volatility as emotions get in the way. Make it your advantage!
If you understand that you should make some good money trading Canacol as it should go fundamentally higher than here by early 2019 when I anticipate the final pipeline will be on-stream (not late 2018).
A good start is buying now under $4.00!
http://seekingalpha.com/article/4046189-canacol-energy-natural-gas-producer-deep-value-hidden-gem
Also - in case you missed it they refinanced their debt today.
http://www.canacolenergy.com/i/pdf/nr/2.17.2017.pdf
CNE.TO - Here is a great comparison to NA plays
@CPTMatt - Cl001 in his newsletter also couldn't find a reason for selloff so bought more. Seems like no other explanation but market sentiment.
there is a link to the latest Scotiabank report at the bottom here comparing the economics of Canacol's conventional gas plays to the best NA plays.
http://www.investorvillage.com/groups.asp?mb=17397&mn=41881&pt=msg&mid=16851858
LMV-H.V Endeavour 2.0 Bermejal U/G for free
Leagold, ex-EDV.TO CEO Niel Woodyear's next project filed a 43-101 today showing that you get the underground reserves for free. Leagold bought Los Filos from goldcorp for USD 360M and the NPV10% post-tax on only the open-pit Bermejal and Open-pit + U/G Los Filos RESERVES of USD 360M @ $1300 gold.
http://www.leagold.com/news/2017/leagold-mining-files-ni-43-101-technical-report-on-los-filos-gold-min
We'll see what happens with the Bermegal U/G. The PEA is meaningless since the ore is INFERRED tonnage and they claim an AISC of $439/oz which is totally unrealistic. Who said 43-101's protect resource investors since Bre-X again?
Nothing worth buying here IMO but I will be watching Leagold over the next couple years since the CEO is coming off an amazing track record with EDV through the downturn, though if you bought EDV in 2009 you are still underwater! It's all about timing and picking up the turn-around/executing story at a bargain. Could have bought any gold stock but endeavour in 2009 and made buckets of money through 2011...
COV.V
Yah - 50% being one time would definitely be the most aggressive position. Maybe a more reasonable assumption is simply that "25% of the costs were front end loaded for the year" if there was some lumpiness to secure the Saudi Arabia contracts. I don't think COV will do too much now until FQ2 is out unless there is a Canadian smallcap investor or newsletter writer who does a detailed piece on Covalon. I'm not aware if this has happened but imagine it might occur in FQ2 with the positive EPS and revenue growth helping to spread the word.
Best ideas from Vancouver Conference **Must Read**
Here it is. May be changing jobs so getting pulled in many different directions these days but make sure you read and consider my ideas from the Vancouver show.
Been going for ~7 years now. This is my annual post. Looking to help everyone make money. To cut down on responses please look into your question and try to provide a follow-up that is sophisticated and well thought-out.
This took a couple weeks to put together FYI and is a continuation of years of continued attendance.
Attendance this year was up slightly from last year. 2015 was the lowest attendance. Market the bottom of the market.
Highlight was Uranium, Uranium, Uranium. The Uranium discussion panel was packed past capacity, same with Uranium company feature, and then UEC (NYSE) presentation. Theme was $18 spot price bottom in December will be generational low and fundamentals support much higher price with no mine in world making money under $45 with $75 being the incentive price needed for new production which is where market is heading in long term with new reactor pipeline. Reason for bottom (or rather what but the bottom in….) is that Kazakhstan, the world’s largest producer who sells most of production at spot engineered a 10% production cut. Elephant in the room for Uranium prices in 2017 is there are 24 current applications in Japan out for Nuclear Facility re-starts since Fukishima. What if they start coming online? Current spot price is $22. Spot price is indicative mostly of course as most production sold via long term contracts
Top ideas for 2017:
General Layout: Company. Thesis. Description.
I own Fission and Orezone bought since the conference and will add Erdene very soon here. I have more good ideas for 2017 but I have posted on the companies a lot before (SMT.TO, AVK.TO).
Two Uranium Picks:
Uranium Energy Corporation UEC (NYSE) Thesis: multi year hold for multi bagger on Uranium recovery. Set-up to be US’s largest producer and have built company for Uranium bull. US imports 95% of Uranium. Made 6 acquisitions in last 5 years. Have tripled resource since Fukishima disaster. Were at USD 800M MC before Fukishima and now at 200M MC. 1/4 the capitalization but 3X the resource. 100% unhedged (nothing contracted) $28M cash. Have 4 or 5 In-Situ mines permitted around South Texas Hobbs facility. Have turned small production off that they had as they want to stay unhedged (not contracted) to retain full exposure to Uranium price upside. Need to do a lot more technical/resource DD here.
Fission (FCU.TO) – Thesis: The next Athabasca mine and buyout, not NexGen. Nick Hodge (new newsletter writer) was banging the table that Fission will be the next Athabasca Uranium mine, not Nexgen because the resource is shallower, higher grade, and has a 20% investment by the Chinese who already agreed to offtake 20% of production. The Chinese have done their DD and picked Fission. The resources is from 50m to 300m depth. Nick thinks the resource update later in 2017 could yield 175m lbs which is around NexGen’s (NXE.V) first resource this year (~200m lbs) except Fission’s will be more economic (closer to surface). Nexgen now has a $1.0B MC and Fission $392M. Sell your Nexgen, buy Fission.
Gold explorer pick
Erdene Resource D. ERD.TO. Knocking it out of the park with world class gold rill hits in probably the last most prospective unexplored gold district like this left in the world. High grade, Mongolian Gold District –. 100M MC. Huge upside if they can discover a world class deposit. Have already delineated what will be a decent resource at Bayan Khundi with free milling gold (management said all oxide at 10 minute presentation). See presentation link. Have doubled since run started on Dec 15th (news released Dec 19th so there was a leak) on 110M @ 9.3 g/t at new Altan Nar prospect starting at 32M depth and is only one of 18 targets in a 5.6km by 1.5km mineralized corridor at Altan Nar. Read the press release.
http://www.erdene.com/assets/pdf/2017/corporate-presentation.pdf
110M @ 9.3 g/t:
http://www.erdene.com/news_releases16/pdf/ERD_PR_TND_101_V15_Final.pdf
Advanced gold deposit that will-be-a mine pick.
Orezone ORE.V. Thesis: Huge market selloff in September on somewhat faulty premised resource updated has created buying opportunity Orezone will be bought out for $1.50 in 2017 (this is CEO’s thoughts) as they have a 3.69M M&I resource with 2.2M Oz basically free digging Saphrolite ore that is super, super cheap to mine and crush before laying on leach pad. Will be a mine. According to the CEO, for whatever reason the resource consultant RPA missed estimating some envelopes (gaps between known ore where resources may be inferred) in September but they had to announce to the market. These were updated in January. Shine is still off Orezone but the story of H1-16 was that Orezone was buyout candidate since resource is extensive and simple to mine. Cormark has a $1.50 target. Paradigm $1.35. I found both analyst reports and these two Canadian resource-focused research houses have the best coverage. Here is January resource update:
http://www.orezone.com/news/press-releases/2017/1/orezone-updates-
bombor%C3%A9-mineral-resource-statement
Silver Pick
Golden Arrow GRG.V. Thesis: will be bought out by Silver Standard in 2017, not a huge gain from that but you will get the remaining properties spun out for free and Golden Arrow has a huge land position in Argentina. This is my post from late November:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=126853872
Gold-ounces-in-the-ground pick.
Gold Mining Inc. Thesis: replicating the Silver Standard model of the 90’s in the recent gold downturn and bought ounces that will become more valuable when POG rises. There are also a few mines in the future in the portfolio. Have M&I resource of 18M oz. This is an Amir Adnani company (UEC – NYSE) and the former Brazil Resources. They transitioned into the Silver Standard model and have done 3 acquisitions near the bottom of the cycle. This was formerly Brazil Resources. The symbol will be GOLD.TO / GLDLF (OTCBB) and you can’t get a quote on google or yahoo finance or stockcharts currently as name is so new so this company is completely off the radar. I haven’t looked in more detail. You heard it here first!
http://www.goldmining.com/staging/goldmining.com/_resources/corporate-presentation.pdf
ORG.V Orca. Former Red Back Team enters Cote D'Ivoire
Swear I posted on Orca before but couldn't find it. Orca Gold is the former Red Back Mining team (insane $7B buyout by Kinross for Tasiast mine before gold peaked in 2011). They have basically knocked it out of the park in Sudan and found mineable bulk tonnage open pit gold in every drill hole in last two years. The presentation below shows you how the envisage developing the mines. Big if here is getting the resource big enough to build a water pipeline, haul roads, powerline, etc.
New news this morning that they are entering Cote D'Ivoire and looks like the Red Back team has previous knowledge of this area and think there may be some low hanging fruit. They are buying from their old Kinross buddies (didn't Kinross learn the first time - they always get the very short end of the stick with this team!)
Basically, there is not much low hanging exploration fruit for previously unexplored, highly prospective gold assets left in the world and this team has knocked it out of the park as Red Back in Mauritania, and now as Orca Gold in Sudan, with a new story in Cote D'Ivoire. Put on your watchlist.
Here is the PR:
http://finance.yahoo.com/news/orca-gold-acquires-exploration-assets-113000750.html
Here is the Presentation. The conceptual plan has emerged in only 3 years.
http://orcagold.com/investors/presentations
I owned last year but sold when it didn't move big in gold bull. Well known Vancouver mining financier Ross Beatty stepped in October 2016 and bought a big chunk which explains the huge volume spike (12M shares) and run from high .30s to low .50s after that.
Still trying to get to my Vancouver Resource conference post but as a primer ERD.TO Erdene is another explorer who is knocking it out of the park on a previously unexplored, highly prospective land package in Mongolia and is hitting long intercepts of high grade hold on every drill hole. They have run up to a $114M MC but there is no other explorer like them in the world I am aware of and could run much higher. Still could be a five bagger. More to come!
CNE.TO - bought more at $3.70.
My biggest single position now, at least temporarily. Seems to be no reason for the selloff other than human emotions so just bought a bunch more at $3.70 as this feels like the bottom. In case you missed the chart CNE has nosedived since Jan 1st on no news. Any news release at this point should put a floor on the SP for 2017 IMO.
COV.V - Update on Q1
All $ amounts in $CAD. I listened to the teleconference.
Covalon announced $5.5M in revenues and $500k in net income or EPS of $.03. They should well surpass $20M in sales in Fiscal 2017 (Oct 1 to Sep 30)
Sales and Marketing expenses saw a significant increase @ $2.8M for the quarter or about 50% of revenues. The CEO was hesitant to discuss specifics with competitors and potential acquirers on the phone call but a good portion of these were due to one-time costs to secure the $20M in Saudi Arabia contracts for 2017. They have also hired a new sales team and are aggressively pursuing new markets.
If you call 50% of those Sales and Marketing Costs as one-time then EPS jumps to $.14 or $.56 annualized. On that assumption COV.C would be trading a P/E of 4X and the company will quadruple sales from $5.7M in F2016 to north of $20M in F2017.
Covalon has no debt is trading at a $44M MC or roughly 2X annualized revenue for a company that just quadrupled sales.
If lower S&M expenses and positive EPS is confirmed for Q2, and Covalon can announce some success in securing new contracts (US, Europe, Aisa, South America they are targeting now) then Covalon should be trading much higher than $2.30 at that point IMO.
Beigledog
He may have been around before with some other companies but I was referring to:
Big success 1 - New Gold
Big success 2 - New Market
Big success 3?
Keep your eye out for new company 3
NGD/NGD.TO
They also produce a lot of copper (hence the reason for low cash costs/AISC - by-products) but have been glancing at chart wondering why they haven't rallied with rest of copper complex without doing any DD and we got our answer today - market waiting on Rainy River build, and or suspicious that additional funds will be needed.
FYI - Randal Oliphant who stepped down from New Gold Executve Chair to regular board member was also heavy hitter behind Newmarket gold and merger with Kirkland so I assume he is stepping aside for big project #3 so this new company is one to watch.
CNE.TO - never went higher and here is great buy opp...
..I sold about 90% of my CNE in December when it didn't break out upwards from consolidation channel dating back to June. I bought most of it back this morning at $3.88 with thesis that this could be the biggest selloff in 2017. Story hasn't changed and CNE is forecasting for a second pipeline to add 40 MMcfd by the end of 2017. While in reality, this will likely be a few months delayed, I don't think we'll see this type of selloff in H2-17 so therefore CNE unlikely to selloff like this again in Feb-June.
If you can get under $4.00 I think we'll see CNE at over $8.00 in 2019 when the third pipeline gets commissioned (+ yet another 100 MMcfd).
If history tells us anything, CNE.TO will continue to be a great trading stock with an underlying fundamental story that is super stable (contracted pricing, growing production, strategic producer serving coastal natural gas shortage to power plants). Sell at an RSI >=80 and buy at RSI <30 for the next couple years. This has worked well for me in 2016.
I think the selloff is combination of shareholders getting frustrated after CNE broke lower after 6 month consolidation, O&G investors who parked money in CNE during the O&G bear and are now rotating out into more speculative plays, and general technical momentum downwards. IMO of course.
Furthermore, in 2015 and 2016 Canacol put in its annual low in January. . December 2014 was the bottom of the O&G rout and this was when the story emerged that CNE had transformed itself into a contracted natural gas producer and acquired Esperanza in a sweetheart deal.
A dividend would help to stabilize CNE.TO.
Here is the latest presentation. Slide 9 tells the story through 2019. Also some great slides comparing CNE economics to North American gas plays.
http://www.canacolenergy.com/i/pdf/ppt/Corporate%20Presentation_1.10.2017.pdf
COV.V - Q1 reports on Monday...
interesting that they are releasing fiscal Q1-17 (Oct-Dec 16) on Monday with Fiscal 2016 results. Perhaps they are releasing Q1 at the same time becuase they might announce positive, sustainable EPS?
This news release popped up towards the end of the day so I bought the only 1000 shares at the ask at a reasonable price. Pretty illiquid and those were all shares reasonable available without driving up the price.
We'll see what is announced on Monday!
http://ir.covalon.com/phoenix.zhtml?c=183092&p=irol-newsArticle&ID=2240367
AUG.TO flow through shares
With flow through shares Auryn will pass through the tax deductions from the exploration expenses to the investor. Investors who are taxable for income tax purposes in Canada will buy as a result. The 36% premium (5.01) of the FT shares to the common shares issued (3.67) seems high as it implies a 36% marginal tax rate which is higher than any province in Canada but I'm not an expert in FT shares (combined federal-bc tax rate for a private corporation in BC for 2017 is 26% for example).
Basically Goldcorp purchased regular shares at 3.67 and you can buy in market at 3.25. The selloff is due to POG decline today.
Auryn resources will likely be bought out some day as they have some mines up there but the question is how big can they get as they are up in frigid Nunavut. I would think Agnico Eagle is the better buyout candidate for operating mines in Canada's north.
Sold a lot of my tax loss buys this morning...
...spooked that gold can't hold $1200 and test $1250. I watched the USD:JPY very closely which is still in weakening trend (Yen strengthening). Where the Yen goes, Gold goes for the last 4 years. I think we could still test $1250 in the next two months but I'm going to wait to see if gold goes back to $1200 and then would buy back as these are liquid.
Great start to the year from my purchases at gold market bottom in week of Dec 19-23 I wrote about here in detail.
Everyone of these purchases I picked up at the bottom trend line of descending channel and they all broke the top trend line of the descending channel suggesting the decline is over so I would buy back.
Dundee (DPM.TO)+ 50%
Pretium + 40%
MAG (MAG.To) + 40%
Terenga (TGZ.TO) + 30-40%
Alacer (ASR.TO) + 30%
Gold Fields (GFI) + 30%
USA.TO +30%
I didn't sell any USA.TO as I think the downside is limited here with WoodMac (the authority on the Zinc Market) predicting average zinc prices of $1.40-$1.50 in 2017* and the peak zinc pricing (coinciding with peak supply shortage) in 2018 once USA.TO's San Rafael expansion is on stream producing 50M lbs of zinc/year that USA.TO will do very well in 2017-2018 even without silver optionality. USA.TO looking great here.
*I'll post more on this with my Vancouver converence update when I can get to it.
Also, I think if gold goes to $1250 here in next couple months that silver will skyrocket so if I buy back in it will be overweight liquid silver producers for a short ride up.
GQM.TO/GQMNF What am I missing?
Anyone looked at Golden Queen and can chime in? Here is what I found: They just announced commercial production in December and still have an EV of $US 115M vs. post-tax NPV of $US 214M
Commercial production announcement:
https://www.goldenqueen.com/news/golden-queen-announces-commercial-production
For the $115M EV see page 3 of the presentation below and note that current MC is the same as when December presentation released (still $USD 88M MC for GQMNF US listing).
See page 26 for post-tax NPV. At $US 1250 Au the project has an 11 year mine life and NPV of $US 214M. That's almost 100% upside before factoring in any long term gold price appreciation.
https://www.goldenqueen.com/assets/docs/pdf/gqm.presentation.dec2016.pdf
Technically and from a valuation perspective, GQM.TO ran up 100% to 1.0X NAV ($2/share range in Toronto) last year. Here is the chart which enticed me to spend 20 minutes looking:
I'm guessing they are slow to commission the processing plant and heap leach as a smaller operation but wondering if anyone else has been following?
Area looks pretty developed around the property (wind, solar, highway) so expansion and any blue sky looks limited at first glance so thesis here is to hold a new producer for a potential revaluation + any potential gold price upside. Call it a one year hold.
Looks like it is a "Clay Family" project whoever that is. They own 30% and a Clay is the CEO and does not appear to have any mining experience.
Beigledog - some miners ideas...
...here for gold & silver producers. I'm up 40% on all of these from purcahses in last week of tax loss selling. They all broke downtrend support and the move is looking like a bull flag followed by consolidation. I think I'll get another run on these if gold test $1250.
Watch for later today and i'll post my thoughts from the Vancouver conference.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=127468448
Checkmate - Aurvista..
..will add to list.
@beigledog....
...I can't reply to iHub messages as non-paying user but drop me that same message in an an email using my ihub username exactly as it appears + @hotmail.com
Vancouver Conference Sunday - Here are my companies...
...to talk to. 15 minutes at each booth adds up to 4 hours pretty quick. Let me know if there is anything you think I should ask. The January show is the annual Vancouver junior focused show where most of the local companies have a presence. Here are the exhibitors:
https://cambridgehouse.com/event/54/vancouver-resource-investment-conference-2017/exhibitors
Alexco AXR.TO – quick update on 2017
Auryn AUG.V – 2017 drilling plans
Avnel AVK.TO – plans for financing mine to production - 2017 close?
Blackbird BBI.V – explain proprietary technology and thoughts on my Chinook holding (CKE.TO)
Diamcor – DMI.V – exploded on Peter Imhof Top Pick – get update (FYI – on $1.05 support lower than Peter Imhof pump)
Golden Arrow – GRG.V – will Silver Standard buy them out in 2017?
GoviEx Uranium GXU.V – top Uranium pick of CEO.CA & Keith Schaefer (O&G Newsletter) – why?
GoldQuest GQC.V – update on recent drill results – zinc, edge of new Porphyry?
Heron HER.TO – update on Project Finance for Woodlawn
K92 Mining – update on 2017 production plans (Chen Lin Pick)
Mandalay MND.TO – update only if Mark Santander (CEO) is at booth
Sierra Metals SMT.TO – 2017 production & plans to sell mine when PE fund shareholder closes
Trevali – TV.TO. Are analysts missing anything? Zinc in 2017?
Victoria Gold VIT.V – plans to sell in competitive auction in 2017?
ORV.TO Checkmate
If you have time give us a couple bullet point from your conversation!
EFR.TO/UUUU Energy Fuels & Uranium Rally
Nexgen has gone stratospheric, Cameco has bottomed and is the no-brainer multi-year hold if you think Uranium has hit a secular bottom in December. Looked around a bit this morning and Energy Fuels seems to be a good alternative. It has doubled off the sector bottom but still plenty of upside and has a good balance sheet from a $15M equity raise last year.
This SA article is a good introduction with a good comp. I am thinking about this now but no position yet.
http://seekingalpha.com/article/4031354-energy-fuels-positioned-lead-american-uranium-renaissance
Also a good comp later in the presentation here highlighting Energy Fuel's USD $31M of WC @ Sep-30. I looked independently at their EDGAR BS and they indeed do have 31M of WC with 17M of that in cash.
http://www.energyfuels.com/wp-content/uploads/2016/12/2016-12-Energy-Fuels-CorpPres-FINAL.pdf
Also - here is a quick summary of what the sector has done:
http://energyandgold.com/2017/01/11/uranium-stocks-surge-nexgen-closes-at-all-time-high/
ORV.TO - what is your bull thesis now?
Sold Orvana back in 2016 as got tired of waiting for any turn around and IMO this was confirmed by their PR below where they guided for $1300-1400 AISC in 2017.
http://www.orvana.com/English/news/news-details/2016/Orvana-Reports-Fiscal-and-Operating-Performance-for-2016-and-Provides-Outlook-for-2017/default.aspx
Looks like the CEO is new, but was a former director of Orvana so no new blood.
Market will never give any value to Bolivia mine.
What is the two sentence bull thesis here? I know it is a good habit to never stop following your losers....
LMC-H.V - Leagold background.
Not only is Neil Woodyer the CEO, Frank Giustra is a big shareholder too. Worth a big look.
https://ceo.ca/@tommy/storyteller-goes-for-gold-again