[ed note: Travis is off on a training ride today, so Myron Martin volunteered this teaser solution that he came up with for a bonus article today… we’ve edited it for clarity, but this is his work and his teaser solution to a recent pitch for Lombardi’s Profit Taker, whose recent ad promises “The Secret Gold Stock of the World’s Greatest Stock Picker”, for your edutainment… enjoy, and please comment at the bottom if you have questions or comments for Myron.]
Maybe this is something to celebrate. I am writing this on our 56th wedding anniversary.
The following teaser appeared in my in-box this past week from Lombardi Publishing, who announced the return of a man they have labelled “the worlds greatest stock picker” — and we’re told that his very first stock pick this year in the gold sector, already returned 625%. He had retired 3 years ago after being editor/analyst for Lombardi’s Profit Taker newsletter, and though they begged and pleaded for him to return, it was not until the gold market began to rally that he agreed to do so.
I recognize the name Robert Appel but I don’t recall ever reading his materials or investing on his advice, but here are some selective phrases from his pitch to renew his service.
He claims, “we are in golds 4th super cycle in which the metal could hit $5000 an ounce,” and gives his reasons WHY! For those so inclined you can see the original “teaser” ad here.
Lombardi’s pitch throws out past gains like .47 to $132, gains Robert Appel has made in the past, to get your attention… and introduces his new pick as a recent IPO also having a 625% potential gain.
Robert believes, (and I tend to agree) that the bottom of the gold market was reached in Nov. 2015, which is why he agreed to come back and resume his illustrious career in stock picking. He cites as his main reasons the world wide move to negative interest rates and the fact that “paper gold trading” now exceeds 293X the actual available gold for delivery. That caused him to withdraw from the market in disgust, we’re told, because the regulators were allowing this blatant manipulation to exist except for minor “slaps on the wrist” in the form of millions of dollars in fines, but no bankers have yet gone to jail, so far it seems the profits are so lucrative to them it is just a cost of doing business.
So what has changed? Robert saw the establishment of the Shanghai Gold Exchange as having a good chance to bring market pricing back to what it should be, price discovery by actual supply and demand fundamentals.
Robert’s focus like mine is on the junior miners, and as usual in these “teasers” his publisher throws out some pretty fantastic numbers, and states “the SMART MONEY is buying into gold hand over fist.” Potential gains are phenomenal, even potentially life changing.
The ad says that his new “below a dollar” stock pick with “near term production” has a “10 bagger potential within months.”
Here’s a bit from the ad:
“Well, weโre looking at a tiny junior miner with the gold-producing assets of a giant. And Iโm not kidding…
“This mine was owned by Barrick Gold for seven years, and it cost them over a quarter-BILLION-dollar investment…
“That includes all the infrastructure to get it ready for production. And it was just about to get started…
“But as gold slumped and hit bottom in 2015, Barrick was selling off its assets (some analysts said it was forced to).
“Including this one.
“In stepped a team of superstar gold vets who scooped it up.
“They didnโt pay half-a-billion, however. Not even $100 million or $50 million.
“They bought it for the FIRE-SALE initial price of just $2 million… literally pennies on the dollar.”
The mine in question was originally acquired by giant Barrick Gold (ABX) 7 years ago for $141.5 million, and they subsequently spent an additional $100 million on permitting and necessary infrastructure to bring it into production.
When Barrick got into financial trouble with some major projects that ran into permitting problems, it became a non-essential asset (as a relatively small mine in comparison to their major producing mines). Believe it or not, after an investment of over $240 Million in the super high grade project, Barrick sold the mine for just $2 Million (plus future profits from specified future production I will mention later).
While I recognize that Barrick is the largest gold producer in the world and is the darling of many institutions and hedge funds and a must for mutual funds, I personally don’t trust management or consider them shareholder friendly. At best I might consider option plays knowing those facts, it is not a stock I would want to own personally because I view management as having an “entitlement mentality” far more interested in feathering their own nest than rewarding shareholders.
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This was cemented for me when I learned they paid an $11 million SIGNING BONUS for an executive they wanted, which I consider simply obscene, nobody is worth that kind of money at the expense of ordinary shareholders. That money would have gone a long way towards rewarding shareholders from the profits possible by a producing high grade mine, and there have been multiple mistakes like that to leave a sour taste in my mouth and put them in my bad books.
Putting that aside, I am happy to be able to pick up some of the crumbs from their table by their ineptness. Barrick Gold has sold numerous assets, you can Google “Barrick Gold sale of Papua New Guinea gold mine” and you will get loads of articles on their selling a 50% interest in their major mine in the country to the Chinese — remember, they had to raise many millions in capital to survive… but that still won’t give you the answer to the Lombardi teaser, unless you pay them the $995 they are asking for a subscription to the newsletter to get the REPORT FREE. WHEW what a deal.
That would take quite a slice out of the money you might have to invest in this stock directly… if you only knew the ticker symbol, a recent IPO. so how about FREE for members of Stock Gumshoe?
While I haven’t invested in it yet (and won’t for at least 72 hrs. after this gets published, per Stock Gumshoe’s trading rules), it turns out this stock was on my dozens-long list to research already… because that is what I do, I make it my business to KNOW what is happening in the sector at all times. In fact, when I can find the time to compile the figures on my selections for the past year, you might just conclude I am just as good a stock picker as Robert Appel.
Without further suspense, the stock being teased is K92 Mining (KNT.V, KNTNF OTC in the US), poised for production at the Kainantu high grade project in Papua New Guinea with all permitting in place, mill and tailings pond etc. all ready to go in a mining friendly jurisdiction.
Yearly production is targeted @ 50,000 oz’s from indicated reserves of 240,000 oz grading 13.3 gr./ton, plus another .84 M .oz inferred @ 11.6 gr./t., with lots of exploration potential waiting to be drilled to expand existing resources. The needed exploration is easily financed from near term re-start of production generating the cash flow required, preventing the usual dilution of early shareholders which means the risk level is much lower than most start=ups. Re-start expenses are more than covered by the existing $10.7M working capital in the treasury.
The management team consists of Ian Stalker, a Scottish born mining engineer and mining developer with 40 years experience in building and operating mines. He increased AngloGold Ashanti’s (AU) production by 10X during his tenure as Managing Director during the 1990’s. He was also CEO of Uramin (uranium) when it was sold to AREVA for $2.5 Billion in 2007.
Chairman Tookie Angus also had a successful mining career with Vantana Gold, (which I remember from many years ago) and Reservoir Resources which I owned for years and was taken over by Nevsun Resources, which I will be reporting on in my next regular column, since I now own it.
President Bryan Slusarchuk, an ex-Canaccord Broker, is helping the company raise more development money and tell the story. Alex Davidson, a former Barrick Executive Vice President, and Doug Kerwin, a former mine finder with the Ivanhoe Group, are advisors to the company, so they have a sound management team in place.
There is a realistic chance of a real big mine popping out of this small newly formed company, according to Ian Slater. Given the exceptional grades and the potential of the unexplored portions of the property ready to be drill tested it is likely to surprise to the upside.
Of course, as with any new mining projec, some execution risks always remain. They seem minimal at this point of development, but you should be aware of the fact that the deal with Barrick calls for payments of a further $60.M from future production, but given the huge money Barrick already invested to bring it to a production ready stage, it is still a real steal for this experienced new management team .
Cartesian Capital is k92’s biggest shareholder, and holds Net Smelter Return royalties on the initial pits to be developed, and in the first 36 months of production is scheduled to receive 18,000 to 20,000 oz’s of the gold production. Compared to the usual hundreds of millions that usually need to be raised to bring a new mine into production, this seems like a dream project in comparison.
Normally I would rate a “near production stage project” as worthy of 2% of your portfolio and I hope everyone will practice some restraint so everyone can get a piece of the action at a good price by being in early. If everything goes well you can always bump up your stake another 1or 2% in the usual summer doldrums once actual commercial production is announced. Don’t throw all your money at this one because my regular column that is almost finished will have another dozen or so projects to consider the end of the month, but this I considered a HOT immediate buy before the market at large even knows about this exciting project.
Glad to see you back Myron, your column reads with a little verve I hope it says as much for your health as it does the KNTNF. I just looked at a chart for K92 and it appears to have risen from .80 to $1.20 plus in the last 5 days. The tease is working I’m going to wait for a pull back. Now I will eagerly await your regular column. If there is anything I can do to help please ask.
I think I might like to jump in too, but I too am a bit scared to jump in at these levels. However, Myron wrote about it AT these levels and recommended it so I guess picking up some at these levels and then getting more later wouldn’t be a bad thing. I’m gonna think about it here for a bit.
I like the idea that they can finance their exploration with their gold production! That should really limit future dilution, but they already have 134 million shares outstanding. Not bad though for what they have – if the Kora deposit proves to be as good as they hope it might be.
I agree the company looks great, but I have a habit of buying high. When I first looked at $KNTNF it was up .20, it ended up .07 for the day. It has made a 50% rise IIRC in the last month that is probably in some part due to the tease, then I may regret it in a month. I originally got into $MUX long too high but was able to average down over the next 18 months. That’s another thing I don’t think this bull has a head of steam up yet and it has much further to go IMO. You make a point about the exploration and reminded me to go to their web site to sign up for the newsletter and check their exploration schedule. I do want to be in before the next report on exploration and that could be earnings.
Congrats on your anniversary.
This fellow-Canuck is glad to have you back.
Thank you for your generosity.
Myron, I am elated that you are fairing well. ๐
Happy 56th anniversary to you and your wife. :-))
I recall my parents 60th, as I threw them a shindig
at the finest restaurant in town. :-)))
Be4everBlessed – #Jammin’
Happy anniversary Myron having passed your gold anniversary at 50 years your gold knowledge is top notch. Here’s hoping you make it to the diamond anniversary at 75 years. Cheers
Nice Myron (but if youre spending your time writing instead of arranging candle light dinners, you may not see the 60th !! ๐ ) Good to have you back in the saddle.
Best to you and the ‘unlucky’ lady….congrats.
Welcome back, ya ol’ miner!
I have lost any Umph! I used to have over Mr’s. Slusarchuk and Tookie Angus, following them in Albania thru TIRXF.
I still hold onto my shares waiting for that elusive first production, first purchased on 11/11/11, on a mine with the opportunity that Tirex has at Mirdita.
I’ll watch…no…..I have other things to do. But good luck to all.
Good to see you writing again Myron.
Happy Anniversary Myron and to your lovely bride!
Wonderful to have you back, thank you for your insight!
Thanks, Myron ! Welcome back, I am looking forward to your column.
In your absence I have made several suggestions to readers in the gold sector.
If you think any of them are poor picks I would appreciate you informing of this.
PVG, SAND, SA, MRLDF (pre-coup), BALMF, ERDCF, FNV, BRIZF, AG, LYDIF, BCEKF, IVPAF.
As you see there are not many actual miners in the list.
I bought MRLDF pre-coup so I’ll be keeping a closer eye on it than normal. My thinking is that Turkey wants to join the EU so they can’t afford to destabilize the country.
MRLDF…Plus, the Turkish conglomerate is muscular and owns 70% of the project. Not a high profile target for state appropriation. I am also concerned but not enough to reduce my position or get out.
No argument with those who are uncomfortable. These darned things are supposed to give us peace of mind, not anxiety.
MRLDF longer than I thought I was ๐ I’m ok with that for now; Thank you Myron, HN and Gummunity. also PVG, IVPAF and? I forget… – Jammin’
One reason I became a member was because of my interest in mining stocks so I’m happy that Myron is back. I’m long PVG, FNV, SAND, SLW, NG, SVGM, and a few others. For some I jumped in too soon and only this year have they bounced back into positive territory.
I think we’re heading into a big bull market so I want to increase my exposure to miners. I’m looking forward to your new article and in my opinion is coming at the right time.
Thanks for a very informative piece; I have always enjoyed your insights. I have missed seeing your writing here.
Happy 56th! We are doing our 50th this year, so 56 is a goal for us to reach. Again, happy anniversary!
R Murray MD CFII
โ@Qwovadis
#Gold #Silver #Miners digesting gains for the next leg up
Dips to MA50 remain a #BUY
$NUGT https://twitter.com/Qwovadis/status/755684247571161092
Thanks, Myron !
Welcome back, I am looking forward to read your next column.
I wish you many years of wealth and health.
Pedro
Well, I regret now not having jumped in. What a day it had yesterday!
$KNTNF / KNT.V no position
Was it this news that sent it spiralling?
VANCOUVER, July 21, 2016 /CNW/ – K92 Mining Inc. (the “Company” or “K92”, TSXV: KNT) is pleased to announce that is has arranged a further non-brokered private placement to raise approximately $2,000,000 (the “Financing”) through the issuance of 1,709,402 units (the “Units”) of the Company at a price of $1.17 per Unit. Each Unit will consist of one Common share (an “Offered Share”) and one Common share purchase warrant (a “Warrant”). Each Warrant will allow the holder to purchase one Common share of K92 at a price of $1.75 for a period of 12 months from the date of issuance.
The warrant price set at $1.75?
Normally, dilution is not well received.
Was it just some stock promotion that sent it spiralling?
https://finance.yahoo.com/news/k92-mining-arranges-2-million-195400352.html
This was a private investor wanting in on the project. The company was not looking for additional financing, but was not going to turn down a large invextor either
To quote the following artical about the 2 mil financing
“The financing has been arranged with a single investor.”
http://www.stockwatch.com/News/Item.aspx?bid=Z-C%3aKNT-2391173&symbol=KNT®ion=C
The question then becomes Who is this single investor? It may have some bearing on why the stock jumped
WOW! How unusual.
That might indeed be the reason. Good find!
Ross Beaty bought $2M PP in K92.
Thanks for the article, and Happy Anniversary!
I want to get in, but it has had one heck of a run here lately. Does anyone have any suggestions as we sit around 1.50? Try and wait, or open a position now? Thanks everyone and GL!
Sorry but it seems like it is already fully valued – great deal at .70, but $1.40? lots of chances to get it lower when frenzy dies down.
I would suggest you might want to take what you view as a small position. You can add to it later if it drops and still have a good average price, and if it goes up, you won’t feel like you totally missed the boat. On these volatile stocks it is not necessarily good to put all your dollars in at one time.
Thank you both for your advice. I have jumped in too late before, and I did not want to get caught again. As always, the advice is much appreciated. Have a great weekend.
Myron, congrats on your Anniversary! This is the first article of yours I have read, very good, thank you. I was impressed and went to (I believe) your website myronswinninjuniors, and read 12 top holdings. Some were very dated NEM was purchased by Molycorp last year, plus tou recommend Endeavour is a steal under 2.60, but it went through a 1-10 reverse split last November, so this last entry is before that. Is there another website I should be looking at? Or will this one be updated soon?
What do stock picker do you recommend to purchase? I’m based in Europe:
KNT or KNTNF ?
Thanks,
Adam
Adam: Generally people (Travis) recommends using the home market as its more liquid. However, that has to be balanced against currency conversion/movement costs.
As shown at this link
http://incakolanews.blogspot.ca/2016/07/daniel-ameduris-paychecks.html, Gummies are really fortunate to benefit from the reliable and objective analysis of Myron, Travis and other contributors. Otherwise, it would be so easy to get abused by paid promotors of stocks whose merits are difficult to assess.
Thousand thanks to all contributors.
Yep, Future Money Trends has been hired by a bunch of little miners to do promotion. That’s one of the things that I mentioned as being off-putting regarding First Mining Finance and Brazil Resources in my piece on Friday, though I hadn’t seen the promotion of K92 yet… it’s a reason to expect those stocks to be much more volatile than “regular” mining stocks, for sure, and it’s completely understandable that some folks want to stay away completely from “pumped” stocks like these. It’s worth nothing, though, that promotion is a key competency of the best junior mining management teams — they have to raise tons of money and get investors excited, the miners who try to let their deposits or discoveries speak for themselves don’t go up 500% when there’s a bull market for gold nearly as easily as the promotional stocks will. I’d completely avoid “pump and dump” stocks, which is what most promoted stocks are (those are stocks that are pumped up by stock promotions so that an offshore trader, usually completely unaffiliated with the company itself, can sell at the peak of the promotion — often “pump and dump” stocks have no actual business or assets beyond a web page and a name that makes them sound like a gold miner, or a biotech innovator, or a marijuana company or a 3D Printing company, or whatever “hot” sector they can think of).
When companies hire paid stock promoters fairly openly like this (and there are, at least, good disclosures) to try to gin up attention and drive the stock price, it’s probably a good idea to at least keep an eye on the insiders — if they’re selling into these promotions, that’s really, really bad. In some cases, though, they seem to be trying hard to keep their share price up for acquisition purposes or for fundraising purposes — if they use their stock to make acquisitions, they want the stock higher (that’s the case with both First Mining and Brazil Resources)… and if they need to raise money to develop a mine or further exploration, they want the stock higher so they can raise money with less dilution. Haven’t checked the insiders at other companies, and I don’t know anything about K92 other than what Myron wrote above, but Brazil Resources has had one director selling some of his stake and First Mining hasn’t had any insider selling this year.
Thanks Travis for the additional input.
Promoted stocks may be very good stocks even if their promotors are paid and possibly biaised. That makes due dilegence really important and StockGumshoe is very useful in this process.
Agree to this. Not everything promoted is bad – and some of the names behind the promoted stocks have a long track record of solid business ethics.
I want to assure everyone that I am not a “stock pumper”per se, I only write about stocks I have personally vetted and invest in myself for long term gains, when to take profits depends on the prevailing market sentiment and each individuals personal situation. . I can understand cautious investors being reluctant to invest in a stock when it has already had a good run, but catching the exact bottom or getting in at exactly the right point on the hockeystick requires a lot of luck or years of experience. Buying in tranches is indeed the safer route. This is why I have always recommended a comparatively small initial stake and then getting on the companies press release list and making any further investments as the company performance via drill results or production as the case may be justifies. In the case of K92 Mining. given their near term production and projection of reaching a new deposit (KORA) within a year it is entirely possible It will continue to climb over summer but if the present consolidation (mild pullback) continues it is entirely possible some investors who bought in between .50 to a dollar may take some profits between $1.50 and $2.00 in which case it could temporarily depress the price, but I doubt any person who takes a small stake even up to $2. will be disappointed 2-3 years down the road if they do get a chance to average down in future as MICH earlier well said, each person has to act on their personal convictions on available information. Several other analysts have jumped on the bandwagon since my article got published and you can find several interviews with the CEO available on the Internet
Newsletter teasers like to give enticing and glowing examples of how if you had invested $5000. or even $10,000. in a given stock you would have made a fortune. a convenient 20/20 hindsight that is highly misleading. If you did that with junior mining companies, explorers in particular, you could get badly burned, with more losses than winners. This is a completely different animal than buying established companies with analyzable sales, profits and measurable margins. It requires a totally different mindset and diversification within the sector to build a profitable portfolio.
I want to thank everyone for your patience and generous accolades but I must ask Travis what evidence he has that Future Money Trends has been hired (I.E. PAID) to pump small miners, I have been reading Daniel Amaduri for years and talked to him at conventions, listened to his interviews with mining executives and have never had any reason to question his integrity. He also puts his money where his mouth is and YES there is a fine line, between accepting money from companies for publicity, ( which I steadfastly will refuse to do) even though I have had offers, but there are a number of analysts I respect and have come to trust over the years who have websites that are supported by mining companies in which they own stock and have a strong disclaimer acknowledging a possible conflict of interest or bias because of that.
I see that as no different than Travis having a disclaimer regarding ads that appear in Gumshoe, the money needed to offer the service has to come from somewhere, it simply comes down to the integrity of the individual. Newsletter publishers are famous for boasting that they prevent conflicts of interest by forbidding their well paid analysts from owning stocks they write about, but has that stopped them from making outrageous claims to get new subscribers to their newsletters? You know the answer to that or you wouldn’t be subscribed to Stock Gumshoe!
I appreciate your words in regards to Dan Amaduri. I’ve found his conviction quite enthusiastic and honest from what I can cross-check over the years – even though he does make a bundle from the offerings of companies. With that said – most of the companies offering the “bundle” are backed by quality teams or assets from what I’ve been able to find.
Not sure how to edit comments – the reason I stated that is because I had a hard time figuring out if a lot of what he said was a pump – even though the metals story is going to be one for the records books.
Between metals and energy/uranium – I think the next 10 years are going to be wild.
Chat: You cant edit comments….publish and be damned ๐
Thank you Myron, I’ve been wondering what kind of pull back this might be. I’ve been watching $MUX (Thank you again) take a pounding and wondering about taking some profit, I’ll sit it out. Got an update from $MUX this morn. Rob McEwen has got the balance sheet in shape for the best opportunity.
Myron, that’s an absurd thing to say. Evidence? Read Ameduri’s disclaimers — he isn’t passively hosting advertising, he is being paid specifically to promote stocks of companies that pay him. That means he’s a PR shill — he may have decent opinions of his own, I don’t know anything else about him, but if so he lost any hint of objectivity when he agreed to be paid to promote individual stocks. His future money trends publication should be considered less objective than a press release from the company itself.
As I said, it doesn’t mean the stock has to be awful… But Ameduri is a PR person for the companies who hire him, not an objective analyst in any way.
Please don’t compare my business to paid stock promoters. You may not see a big difference, but I do, and I find the comparison offensive.
From a recent disclaimer on Ameduri’s article about K92:
“Our activities involve actual conflicts of interest, since we receive monetary or securities compensation in the very securities we are promoting and shortly after we receive the monetary compensation we promote the securities or after we receive the securities, we sell the securities during our promotional activities or thereafter.”
To add to this discussion… this was from the footer notes of an email last week on FMT:
” Future Money Trends LLC has been compensated two hundred and seventy thousand dollars for a two week marketing program, paid for by K92 Mining. We were previously compensated one hundred and seventy thousand for a two week program that has since expired. We have also been compensated one hundred and forty five thousand options by the company for a six month video advertisement campaign.”
So the issue to me is not that he gets paid to advertise companies. He does a decent job with the channel. Do we have any evidence of stocks that he promoted that were a total sham or with malicious intent just for the sake of making bank?
I tend to find a pattern that even though he’s getting $$$ – the stuff being promoted tends to be higher quality.
Do we have evidence to the contrary? As long as the stuff being promoted is quality and helps with new learning or material in the sector, to then go and cross-check or bounce ideas off of that …. that’s ok to me. It’s helped me a lot a personally – even though it’d be nice to see companies touted that aren’t on the payroll.
Do people dislike FMT because they think it’s a scam – or just because of the fact that he gets a boatload of coin for doing what he does?
Keith Neumeyer has been around a long time and we all know he’s been able to produce quality for decades – they pay FMT which had me wonder at first… but I just chalked it up to advertising.
Everyone advertises I guess…
I have no problem with advertising or with promotion that is clear and disclosed, as FMT is. I just think we need to think of it as something entirely different from honest or analytical analysis.
I agree. I don’t think FMT is analytical at all like Gumshoe – two completely separate gigs.
I do find the “one pagers” helpful such as futuremoneytrends.com/goldipo, but that’s not analytical analysis like Gumshoe is.
It’d be great if for every company FMT promotes (that is new).. gumeshoe does a short run through of it ๐
Maybe for the IRR? Not a massive lecture – but a few paragraphs of thumbs up or down.
Cheers
He has recc’d a couple DOGS. Potash Ridge (POTRF) is down ~36% when he recc’d it ~13 weeks ago, and American Lithium (AMLM), which for the VERY FIRST TIME since he recc’d it 10 weeks ago, it broke above 5 cents to $0.0575…
He’s being paid to promote this stock…ha ha ha ha That figures…nothing but thieves…den of thieves. Lol
New to board. Here is a recent interview with Bryan Slesarchuk, the President of K92 Mining, Inc.
http://sgtreport.com/
K92 only weeks away from production.
Yikes…..once again, we must continue to do due dilligence with everything, even buying toothpaste.
Just because someone has a video promotion of a certain stock does not mean that it is legit. Mr. Slesarchuck is a grat promoter and “money getter” to finance operations. Listen carefully how he intermingles one fact with another, but doesn’t actually connect the two together. He leaves that to you.
Biased? Maybe I am, but I heard it all before with TIRXF.
FYI
http://m.marketwired.com/press-release/otterburn-to-acquire-the-kainantu-gold-copper-mine-in-papua-new-guinea-tsx-venture-obn-1941159.htm
Long $KTNTF