Spanish Mountain
by bosley | October 27, 2012 12:45 pm
I got a line on a junior miner Spanish Mountain Gold SPAZF on the pink sheets. It seems to have everything: no debt, 3.2 Moz of gold[1], profitable extraction, located in B.C. Canada[2], all infrastructure already in place, good relations with the First Nations, permitted mines already operating in the area. Most importantly an all-star board of directors, and just recently Jim Rogers joined the board. Jim Rogers has always said eschew the miners — buy the bullion. He has a lot of face to lose and very little to gain by joining this board, unless he really believes it is a moneymaker. The stock has been terribly beaten down to .28. But they are due any day to release a new PEA, and it just looks like I should jump all over this. So can anyone tell me what I’m missing? I seem to be the only one in the word who’s gagga over this stock. Of course I’m not naive. I understand that even the best juniors always carry risk, but this seems like such a good bet, so can anyone give me any info I may have missed. Thanx.
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I took a quick look and it does look interesting. That said there are a couple of things which concern me first is that there is quite a few shares outstanding about 192m. The firm as of June 30 has aprox. 7m in cash. They spent 10m in exploration cost in 6 months in 2012. Management state in The MDA as of June 30 that they currently have sufficient cash to bring the project to preproduction which I doubt for two reasons. One they acquired additional property to the claim they were preparing a NI 43-101 report. They will want to add the new properties which means additional drilling and related expenses. Two they have are very forthcoming about their planned expenses.
I will keep an eye on the price and see if it drops some more by year end. The stock has dropped in price all year so there is likely to be some tax loss selling before year end so it is likely to get cheaper.
Alain thanx for your analysis. That’s a great point about tax loss selling. But they’re supposed to put out a PEA or PFS any day now that might be a catalyst. As far as the newly acquired property, they say they’ve decided that they will proceed on the 3.2 Moz they have and future drilling on the new property will be icing on the cake. I am absolutely no investment expert ( I have TD Ameritrade statements to prove it.) But I have studied and invested in this company for 3 years and I think its gonna pop when the PEA comes out. I have a super strong gut feeling on this guy. (Of course my normal gut feelings are 70% wrong) Good Luck to you.
Well I’ll buy a 1/3 position and see. Thanks for bringing it to our attention.