Value Microcaps Junior Miners

[Bobwins]

I don't know anything about LRR.v either. It appears they have some cash(20 million) and a development project in Mexico.

Looks like reserves/resources is about double before SMC updates it's reserves/resources with this summer's drill program. However their project is longer term and won't contribute to production near term so any production is going to come from SMC, not LRR.

There will also be a delay in Orosi production because I can't believe they will restart Orosi before the merger is complete and that's not set until the end of April. So you have to add 9 months onto April 29th before Orosi will be producing 80,000 oz per annum.

Until then, it is likely that LRR.v will lose money due to higher overhead. They will also likely have to take on debt or issue shares to completely fund Orosi.

So the question is whether the stock market will recognize the potential of LRR.v and reward the stock price or will only really boost the price when production is actual and contributing to reported revs. That won't be until early/mid 2010.

Your choice is whether to wait for the big upside in LRR or sell now and invest in something that has closer production and revs. Goro may not be much better because they are talking mid 2009 and that could slide more if they don't get their remaining permits soon.

I think existing profitable producers are a safer bet to increase in price. SMF.to/SEMFF.pk, WGW/WGI.to are two examples of profitable producers selling at forward p/e's of 5. There is no exploration risk, they have decent reserves and if the market likes gold stocks, these should move sooner than exploration stocks.

I think the potential of SMC is still there with LRR so the choice isn't easy. Bobwins