Jay Taylor: In Precious Metals, Cash Flow Is King
TICKERS: AEM, AR, AVA, BVA, DNG, EMX, G; GG, GRG; GAC; GARWF, MRO, MAD, NEM, NG, PZG, NKL; PNIKF; P94P, RRI, SGR, SSL, TMM; TGD
Source: Kevin Michael Grace of The Gold Report (6/17/13) (Section of article)
: Do you like the prospect-generator model? JT
: Yes, mainly because prospect generators use other people's money to derisk projects and avoid dilution. Prospect generators, at least the companies that I follow and respect, have very strong technical talents in exploration. They've identified projects that have a reasonable potential to host meaningful ore deposits. Most companies have a couple of projects and blow through huge amounts of money to drill them out. Prospect generators do some low-cost preliminary work to establish a geological thesis for exploration. Then they get other companies to come in and spend their money. TGR:
What companies do you like in this area? JT
: Eurasian Minerals Inc.
is my favorite. There are other companies that I would call hybrid prospect generators, companies like Aurvista Gold Corp. (AVA:TSX.V), Bravada Gold Corp. (BVA:TSX.V) and Paramount Gold and Silver Corp. (PZG:NYSE.MKT; PZG:TSX). But among pure project generators, Eurasian has the biggest projects and the most money, and it is allied with the biggest mining companies. I think it's just a matter of time before Eurasian comes up with at least one major economic deposit that sends the stock to much higher levels.
There are others I like, such as Riverside Resources Inc. (RRI:TSX)
. John-Mark Staude, the president and CEO, is doing a remarkable job. Riverside has projects in Mexico and in the United States and also now some base metals deposits that are being explored by major companies in British Columbia. The company just announced some excellent high-grade silver results from trench assays and drill core on its Jesus Maria mine on its Penoles project in Durango, Mexico. This could be the first discovery that catapults the company from a $0.35/share stock into the mining big leagues.