Silver Penny Plays

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Expert's Opinion: 'Back Up the Truck' for this Stock

By Ron Struthers
11/21/17

Ron Struthers of Struthers' Resource Stock Report takes a look at results from two mining companies, and picks the one he considers a winner.

I think a comparison of Garibaldi Resources Corp. (GGI:TSX.V) and Silver Bull Resources Inc. (SVB:TSX; SVBL:NYSE.MKT) would be a very good exercise. Both are hitting some high-grade sulphides: Garibaldi, nickel and copper with precious metals; and Silver Bull, zinc and lead with silver.

GGI had a high-grade intersect of 7.2% nickel and 3.4% copper over 4.8 meters with 0.82 g/t palladium, 0.78 g/t platinum, 0.40 g/t Au, 10 g/t Ag and 0.195% cobalt. Based on current metal prices that 4.8 meters by GGI is worth around $1,018 per ton.

SVB hit 9 meters @ 20.7% zinc, 1.0% lead, 98 g/t silver and 0.26% copper including 3.65 meters @ 47.8% zinc, 2.5% lead, 105 g/t silver and 0.26% copper from 3.55 meters to 7.2 meters. Based on current metal prices that 3.65 meters by SVB is worth around $1,498 per ton.

So on yesterday's drill results the Silver Bull intersect is worth about 50% more than GGI's intersect, but GGI is valued 1,200% higher, or 13 times. If you own GGI and not SVB it is obvious what to do. Regardless this exercise points out the extreme undervaluation of SVB, and I am not factoring the deposit SVB already has.

GGI market cap: 96.7 X $3.80 = $367 million

SVB market cap: 199 X $0.14 = $28 million

(For purposes of this post, I will concentrate on the author's 'Silver Bull' section. His 'Garibaldi Resources' comments can be accessed via the link below.

Silver Bull (recent price $0.14; entry price $0.12) Opinion: Strong buy; back up the truck.

Everyone should own a position in this stock before the market catches on to this. There was a $0.08 financing; most of that (18 million shares) became free trading last week and that might be some of the pressure holding the stock back. I believe it is not very wise to be a seller here, but some just see a good profit, take it and run?

The Nov. 20 press release headline reads: Silver Bull intersected 9 meters of sulphide mineralization grading 20.7% zinc, 1% lead and 98 g/t silver, including 3.65 meters of massive sulphide mineralization grading 47.8% zinc, 2.5% lead and 105 g/t silver on its Sierra Mojada project in Coahuila, Mexico. SVB is hitting better numbers than Garibaldi; the stock is a steal here. Zinc is not priced as high as nickel, but the SVB zinc grades are much higher—and so are the precious metals, because the silver grades so high; 537 g/t silver is like 10 g/t gold.

Highlights from the four holes announced in this news release include:

Hole T17010: 9 meters @ 20.7% zinc, 1.0% lead, 98 g/t silver and 0.26% copper including 3.65 meters @ 47.8% zinc, 2.5% lead, 105 g/t silver and 0.26% copper from 3.55 meters to 7.2 meters.

Hole T17009: 3 meters @ 537 g/t silver, 3.9% zinc and 1.06% copper including 1 meter @ 1,280 g/t silver, 14.8% zinc and 2.3% copper from 0 meters to 1 meter.

Holes 7 and 8 had no significant hits.

This drilling was on the second of three sulphide structures that Silver Bull has identified, and this second one seems more dominant in zinc compared to copper in the first structure.

Tim Barry, president, CEO and director of Silver Bull states, "We are extremely pleased with the results from this batch of drill core. The new sulphide zone is proving to be very productive for high grade sulphide mineralization. The drilling summarized in this news release targeted the second of three steeply dipping, discreet structures we have identified in the sulphide zone. Drilling from the first structure previously announced in the news releases of holes T17001 to T17006 was dominated by high grade silver-copper sulphide mineralization grading up 1,300g/t silver and 6% copper. This second structure is dominated by extremely high zinc sulphide mineralization, grading up to 48% zinc and suggests a metal zonation in the mineralization we see at Sierra Mojada and provides very useful information in helping us vector into an intrusion, interpreted as the source of metals currently defined on the project. In addition to vectoring in on an intrusive source we can now project the mineralization we are currently drilling into the extensive channel sampling and drilling completed at the eastern end of the deposit and show a target over 3 kilometers in strike length. When you consider this, coupled with the fact we have identified three structures in this east-west trend similar in style, dip and grade of mineralization, we see some very significant immediate targets at Sierra Mojada. In addition to the drilling, work is currently underway to access some of the underground workings further east to confirm the style of mineralization."

Ron Struthers founded Struthers' Resource Stock Report 23 years ago. The report covers senior and junior companies with ample trading liquidity. He started his Millennium Index of dividend stocks in 2003 - $1,000 invested then was worth over $4,000 end of 2014 and the index returned 26.8% in 2016. He retired from IBM after 30 years in customer service, systems and business analyst, also developing his own charting software. He has expertise in junior start-ups and was a co-founder of Paramount Gold and Silver.

Disclosure:
1) Ron Struthers: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Silver Bull Resources and Garibaldi Resources. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company currently has a financial relationship with the following companies mentioned in this article: Silver Bull Resources. I determined which companies would be included in this article based on my research and understanding of the sector.

2) The following companies mentioned in this article are sponsors of Streetwise Reports: None. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.

3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.

https://www.streetwisereports.com/article/2017/11/21/expert-opinion-back-up-the-truck-for-this-stock.html