Gold and Silver and Hard Assets after Trump’s Inauguration…2017MAKE YOUR PORTFOLIO GREAT AGAIN !
This thread is a continuation of several threads posted previously by the author on gold and silver and hard asset investments. I am still a believer in hard assets. I also believe we are entering a period of inflation with continued dollar devaluation, higher interest rates, and a sluggish economy with chaotic dislocations. I believe there will be a lot of uncertainty and high volatility.
PURPOSE My intent is to find and discuss good mining and commodity ideas. Gold and silver remain a focus, but I want to achieve a more balanced approach still based on tangible commodities.
STEEL and IRON ORE…I believe Trump’s programs will benefit iron ore and steel. Stocks in this sector have been beaten down terribly but are rebounding. I am long VALE, a Brazilian company which is the world’s largest iron ore producer. I have been long Arcelor Mittal but do not have a position at the moment. Anybody know anything about cement and asphalt ?
COPPER, ZINC, PGM METALS…My very best conviction stock is Ivanhoe Mines IVPAF. I am completely comfortable with a large single position in IVPAF to cover these metals. However other investors may be uncomfortable with a small cap in sub-Saharan Africa. So I think it is beneficial to introduce other names even though I myself am not interested. Rio Tinto, Freeport-McMoran, Teck, Turquoise Hill, BHP and others come to mind. Travis, our host, is long Altius Minerals, and I have been also.
URANIUM…I’m bullish but the choices seem pretty limited. My top three investment-grade choices are Cameco first, then Cameco second, or my third pick would be Cameco. After that, you are speculating on small caps, or buying ETFS or funds comprised of Cameco and some small caps. At the moment, I am long Cameco and UEC.
LITHIUM…I am considering a long position in lithium. I have nothing to recommend at the moment, although I am strongly considering Galaxy, an Australian company. And I like Neometals, also an Australian, but it is difficult to get from my broker, who hates it when I want to buy obscure 50 cent companies on small foreign exchanges. If anybody’s got a great battery play, I am interested.
POTASH/FERTILIZER…very interested but they all seem pretty expensive. There has been consolidation but I have considered Agrium, Mosaic, and there is a German company whose name I forget at the moment (K&D? K&S?).
OIL AND GAS…I would like some very good conviction picks accompanied by strong reasons and decent research. This field is so big, we could get completely lost just tossing names around. I am somewhat worried about price weakness in the energy sector but feel that it is worthwhile to develop a point of view on a few companies. I have little experience although I made very good money in the past on XOM and CVX. Currently I would be interested in pipelines, LNG, or any other sector that someone knows something about. In natgas I like OGZPY.
SOLAR and WIND…really not too interested. The results depend too much on politics, the time frames seem too long. But I am not completely closed-minded on it if you have conviction on something.
COAL…same opinion as solar and wind, but the prices are low and depressed instead of hyped and high-flying. I am still stuck with some defaulted Arch Coal bonds that my financial advisor recommended. They went to ZERO. Now they are worth a Starbucks latte and a pastry. And no espresso shot in the latte, either.
AGRICULTURE…very interested. A large sector but really not too many choices if you rule out futures, like I do. I have a few obscure favorites, but no positions at present:
WHGPY (Chinese pork processor who bought Smithfield)
LAND (Gladstone Land, California farmland)
INCPY (Input Capital, a Canadian canola, streaming model).
Open to more conventional picks like ADM and DBA.
GOLD AND SILVER…my picks have been discussed at length previously. I follow these pretty closely. I am long royalty/streamers SAND, FNV, SLW, and OR; miners PVG, MAG; developers SA, CLASF, MRDCF, BALMF, KNTNF, and LXVMF; and I own PSLV and physical bullion. I swing trade big caps ABX and NEM.
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DISCLOSURES. I am a retired executive and an amateur investor. I like both fundamental and technical analysis. I am a medium-term to long-term position player and prefer to discuss stock investment in that context. Please no minute-by-minute reports that oil is now 52.50 down 10 cents and the Iranians may suspend Ramadan next week so you are going long until the afternoon bell.
I am not an expert in any of the commodities discussed nor am I qualified to give advice.
Everyone makes mistakes and I make more than my share.Sometimes I change my mind.
When I post, I express my opinions and my positions. These are just that…they are my opinions and my positions. They are not advice or recommendations, which I remind you I am unqualified to make.
Opinions and positions are subject to change at any moment. That is quite unlike the pig-headed and foolish political convictions everybody carries around adamantly, and which change only rarely for unpredictable reasons that have nothing to do with logical thought or reasoned discussion.
Because of this, political developments can be introduced on this thread only when they have a clear bearing on the commodities or companies under discussion.
You are responsible for your decisions, and I am responsible for mine. Caveat emptor.
I would like to operate in a friendly, honest, and constructive atmosphere.
As thread moderator I reserve to myself the role of referee, censor, arbiter, and Grand Poobah, subject to the over-arching authority of Travis, who owns the site and who has on occasion exercised his right to ruthlessly censor and suppress my radical blatherings.
This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.
Luna/JDL Gold…the big winner in this is Sandstorm Gold. You have a play on both of these because Sandstorm gets a royalty off the top.
Obvious really but….
Brokerages Set Ivanhoe Mines Ltd (IVN) Target Price at $5.45
https://sportsperspectives.com/2017/02/10/brokerages-set-ivanhoe-mines-ltd-ivn-target-price-at-5-45.html
And of note – BHP Said to Declare Force Majeure on Copper From Escondida
https://www.bloomberg.com/news/articles/2017-02-10/bhp-said-to-declare-force-majeure-on-shipments-from-escondida-iyzv4mui
$IVPAF…Ivanhoe now a “10 bagger” !….A year ago January, Ivanhoe hit a low of 36 cents. Today it hit 3.64.
I entered around 80 cents.
Still long. Fundamentally I see no reason to sell, other than dizziness. No other reason to sell.
$IVPAF only a double for me but I am more than happy with it. Thanks for spreading the Ivanhoe word to us HN.
$IVN Ditto
$IVPAF entry…I noticed it in January, but didn’t enter a real position until somewhat later. My first big entry was in May at 76 cents. Added at 78 cents and at 1.40-1.50. It’s tough buying at the low, you are too nervous.
After the first two buys in an IRA account, my broker refused to make further purchases because it was a pink sheet stock under $2.00.
So I started adding in another account at a different broker. In that account, even at higher entry prices, Ivanhoe is by itself the entire gain in the account.
Join the discussion just read where the forward demand for copper was deemed to be not that great. got that of off google.
$FFMGF – First Mining Finance Files Ni 43-101 Resource Estimate For Goldlund Gold Project, Completes Acquisition Of Ontario And Québec Claims And Grants Stock Options
https://www.firstminingfinance.com/news-room/first-mining-finance-files-ni-43-101-resource-estimate-for-goldlund-gold-project-completes-acquisition-of-ontario-and-quebec-claims-and-grants-stock-options
$FFMGF long
You need to have an exceedingly high degree of confidence in Neumayer to be in this stock. I am not critical of him by any means, but I just do not have the degree of confidence in him compared to Friedland, Quartermain, or Watson. Or even
Rob McEwen of MUX; and I am not invested in MUX.
His promotion quotient is a little on the high side for my taste.
I’m not sold on $FFMGF, I took a loss on some now watching for a catalyst to hold or sell. Had to take a min out of IRA. That will be my next purchase $CTEQF.
On the second-tier royalty companies, I like $OR Osisko Gold Royalties and I had a half position.
I like their ability to offer services and operational expertise to developers, in addition to cash. It separates them from the other royalty companies, and they seem to have a good starter core.
But I had to raise cash for MAG, IVPAF, and more PVG so I sold it.
“His promotion quotient is a little on the high side for my taste.”
I am puzzled as to why you are so confident in Robert Friedland. Have you by chance read “The Big Score Robert Friedland And The Voisey’s Bay Hustle” by Jacque McNish? Friedland is a master mining stock promoter with questionable ethics. He has left a trail of money losing investors in his wake, while profiting nicely himself.
$TLRS This company may be VERY undervalued and an opportunity, I thought so, and put some $$$ down. Look here if you are interested in checking out the case this company makes for itself. http://timberlineresources.co/wp-content/uploads/2017/01/20170117-Corporate-Presentation_TLR-V2.pdf
Thanks Renbycage.
It seems interesting enough to check further.
Will take a look and run the HOG on it.
I’ll be interested for any of your analysis, cause I’m looking for the downside, I can’t find it. To me it checks most of the boxes. Forget about Seven Troughs and Eureka and consider them bonuses, Talapoosa is what I am looking at, there is a PEA that is very compelling. I see $138 mil of net cash flow at $1000 gold price, and the present market cap of the company is under 9 mil. That seems anomalous to me, anomalous is what i live for. What do you think?
From the price you would think this is in the middle of Iraq. Its in the heart of gold country USA under a new administration friendly to the mining industry.
A quick look at Timberline:
It looks good to me on most counts: jurisdiction, deposit size and grade (taking their figures), AISC looks OK, management looks OK. But the potential problem is ready cash:
To exercise their option on Talapoosa from Gunpoint, they need to pay $1 million cash and 1 million shares by March 31, 2017; then $2 million and another 1 million shares by March 2018; then a final payment of $8 million and 1.5 million shares in 2019.
And if the price of gold goes above $1600 for any 90 day period, then another $10 million will be due to Gunpoint.
Right now they have only $400K cash. So where and how are they going to get the cash to exercise their option from Gunpoint, and also how are they going to fund any more development and permitting activity ? They need a million bucks by March 31 just to exercise their option.
Now the total amount they need over the next three years is digestible and not too detrimental compared to the expected cash flow of the mine. The problem is, how do they get from here to there, without huge pressure on finances and dilution of current shareholders ?
And this is not even considering what it will take to get production operations up and running. Hard to imagine this all happening without some pretty dramatic dilution to existing shares.
The company to own in this scenario is Gunpoint…but I suppose it is private.
$TLRS…I agree it is cheap, the issue is we have no idea if or on what terms the money will be raised to exercise the option.
The situation is somewhat similar to Colorado Resources, in that Colorado has an option on a large tract of Seabridge.
Colorado will need to raise $4 million to exercise.
But Colorado has a different property that is wholly owned by them, so the option is not a life and death situation; and Colorado also has deep-pocket backers already. Plus, there is not a pressing time frame for exercise.
In contrast, TLRS has a short deadline (March 31) and it is basically an all-or-nothing deal for them, since Talapoosa is their main project.
I am not being negative about Talapoosa. But March 31st is around the corner. Personally I would wait to see what happens, you are facing a disaster if they do not come up with the million bucks in six weeks; and possibly a serious dilution (at least 1 million shares) even if they do exercise.
If a big backer or partner comes in, you may still be better off waiting and jumping into shares of the new partner. You will have the expert confirmation of a third party (the new backer) and you will get an idea whether the next thresholds for exercise will be met. These will require $10 million, possibly $20 million, and a couple of million shares…just to exercise the option.
The total amounts needed are reasonable considering the
deposit…but again, how are they going to get from Point A to Point B ?
TLRS…It’s a dog-eat-dog world out there. Suppose Mr. Deep Pockets believed in Talapoosa and had the cash to exercise the option, why wouldn’t he just let TLRS hang there, let the option expire, and approach Gunpoint directly ?
I may have a source for insight on the matter of this march payment. I see what I can come up with.
Yes, you honed right in to those money timelines, and their paltry cash on hand. Good job, I saw that as well. I better find a way to make sure that march payment is going to be made. I project Gunpoint is fully onboard, I believe they own something like 7% of the company, and using Timberline to monetize their property, but I wouldn’t want to be in this investment if they miss that payment.
Gunpoint may not be a positive holder for TLRS.
It might be in Gunpoint’s interest to find a stronger partner than TLRS, even though they have an interest in it. The value of TLRS is only 7 million.
Not just March 2017. You’ve got another payment 2018 and a whopper in 2019.
My insight tells me they will not miss any option payments, which is the best way i can say it. This message will self-destruct in 60 seconds.
That’s great, I hope you hit a home run with it.
Keep us posted.
Assuming your private source of insight is correct, there is still the matter of how the financing will affect the existing stockholders. There are $13 million in payments due over three years, plus 3.5 million shares, and the market cap of the company is $7 million.
If I read Talapoosa PEA correctly, it’ll take about $270 mil to pay for it, and at price of gold of $1300, they can pay that back in a year, at $1000 gold, 5 years. 10 or 11 year mine life.
No disagreement, from the PEA the project is pretty good, and the required option money is not very great in relation to the forecasted cash flow, and the contractual dilution is known.
It’s just a question of how the existing shareholders will be diluted along the way.
I like the deposit.
yes, dilution is inevitable, and uncertain, and some faith is required without knowing whether it is worthy. My play here is anomalous under-evaluation. I see the chance for a quick double [4 months], then buy back my money, and speculate with the rest for free. So we see whether my plan works.
TLRS…it might happen. The stock has had a low of 2 cents and a high of 50 cents, Friday closed at 33 cents.
It is a speculation; but at least you know the deposit is OK.
If you want a double in four months, try a few bucks on MRLDF at $1.00.
$TLRS…I checked the HOG rating for Timberline, and it is very high. Up there with NAK. So strictly based on the deposit, I agree with you that Timberline is undervalued.
I gave the benefit of the doubt on the reserves to Timberline…their 1 million ounces are imeasured and indicated, it is not a “2 P” number.
The HOG rating is not the end-all definitive criterion for me, it is simply one factor
to consider. Both NAK and TLRS have very high HOG ratings, but I am not long either one, for different reasons.
The NAK deposit is of questionable economic value to me, and the politics and time frame are too uncertain. With TLRS, as I explained I am worried about the financials.
Will leave the rest of the play-by-play on TLRS up to you.
Keep us posted, I hope you get a moon shot, and if the situation clarifies I would consider going in.
I hope you are not being held at gunpoint.
I’ll pick up a few shares of MRLDF, I know they are sitting pretty, and we see if either doubles or which one first,
$MRLDF may not double as fast as TLRS, but there is virtually no chance of it dropping through the floor.
HN that’s a nice opening for me insert my foot in my mouth. When TLRS came up I recognised it as being a favorite of Eric Muschinski of Gold Investment Letter,
eric@phenom.ventures. I thought I would go thru his newsletter and pick out the TLRS comments. The one thing I can say is eric has faith in TLRS.
This is pretty long HN so if you want to delete or edit it down no problem.
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Zero in On Your Favorites
Gold investment news letter – free one
TLRS
3/9/16
I’m arriving in Toronto later today and will have some time open Thursday afternoon before my flight out to Brazil. If you’re in town from PDAC or local to Toronto and would like to meet up, shoot me an email. From what I’m hearing on the street, and I’ll have an even better feel the next couple of weeks, things are screaming buys in Brazil. I will be shopping for another property to buy and may be forming a small $1MM-$2MM fund to allow some friends/subscribers the ability to participate. As an example of the amazing buying power the US dollar has, a 90 minute massage from my favorite masseuse (high end spa), is $27! Convert that to real estate and you get the point….stay tuned.
3/15/16
Timberline Resources (TLRS/TBR.V) is likely to pop any day now. I believe that they are on the cusp of doing a deal that gives us around a double from current prices of 15 cents US. If you have some, hold. If you want to take advantage of what will very likely be a good short term trading opportunity, buy up to 16 cents US. Timberline was recently offered 58 cents per share in cash. A new buyer will likely come in lower than that but they know investors need a premium to market. If it’s another public company, investors can still partake in the upside on the assets in a new gold bull cycle, which I would support, versus taking it private, which the 58 cent offer would have done.
5/16/16
Lastly, I’ll have a full update on Timberline Resources (TLRS/TBR.V) this week. I’m very bullish. Things are really getting exciting for us and in this strong environment for gold, silver, and mining stocks, you should continue to receive regular communication from me with fresh thoughts and ideas.
5/18/16
It is getting more and more difficult to find quality junior miners that haven’t skyrocketed as of yet. But they do exist and are popping like popcorn everyday once they decide to play catch up to the rest of the sector. One such stock that has yet to move up hardly at all but is overdue for a valuation rest is Timberline Resources (TLRS on OTC and TBR.V in Canada). TLRS closed yesterday at 24 cents (TBR.V at 30 cents) but should be trading well over $1 by now. I say that because whether you look at the weekly chart on GDXJ (Junior miners ETF) or some of the stronger movers like McEwen Mining (MUX), Timberline has some serious catching up to do.
6/5/16
I believe now (Monday) is a great time to buy your favorites or ones you missed altogether, in particular MUX, GGN, and juniors Patriot Gold (PGOL) and Timberline Resources (TLRS/TBR.V). You can read my recent research reports on MUX and GGN on our blog:
http://www.goldinvestmentletter.com/blog/
I will be publishing new research on Timberline and Patriot likely in June as well, but certainly this summer.
6/14/16
Next, the gold junior I’m most bullish on right now is Timberline Resources (TLRS/TBR.V) at 39 cents US. Timberline owns several assets in Nevada with Talapoosa and Eureka containing 1,900,000 ounces of gold in the inferred/indicated categories. Per my example above, if TLRS were to be valued at $30 an ounce in the ground, which actually is on the lower end of various gold market valuations, the stock would be trading at $1.50 right now.
Additionally, if TLRS just performed the same as GDXJ and the junior gold sector, it would already be at $1.50 per share! This is the opportunity…Timberline has lagged the sector dramatically but it will play catch up. They are closing a financing next week, giving them cash, breathing room, and money to beef up the metallurgy at their flagship Talapoosa property. I expect good news going forward and a much higher share price by year end. Subscribers should buy TLRS up to 50 cents per share and TBR up to 65 cents in Canada. I will be publishing a full research report on Timberline this summer and can make a case for several dollars per share in a strong gold market.
6/23/16
Next, the gold junior I’m most bullish on right now is Timberline Resources (TLRS/TBR.V) at 39 cents US. Timberline owns several assets in Nevada with Talapoosa and Eureka containing 1,900,000 ounces of gold in the inferred/indicated categories. Per my example above, if TLRS were to be valued at $30 an ounce in the ground, which actually is on the lower end of various gold market valuations, the stock would be trading at $1.50 right now.
Additionally, if TLRS just performed the same as GDXJ and the junior gold sector, it would already be at $1.50 per share! This is the opportunity…Timberline has lagged the sector dramatically but it will play catch up. They are closing a financing next week, giving them cash, breathing room, and money to beef up the metallurgy at their flagship Talapoosa property. I expect good news going forward and a much higher share price by year end. Subscribers should buy TLRS up to 50 cents per share and TBR up to 65 cents in Canada. I will be publishing a full research report on Timberline this summer and can make a case for several dollars per share in a strong gold market.
6/17/16
Patriot Gold, Timberline Resources, then McEwen Mining are my three largest US based gold company bets. I’m not buying MUX in the high $3’s right now but will put the spotlight on it when it pulls back and becomes a buy again. TLRS/TBR.V and PGOL are still strong buys at current prices. TLRS can be bought up to 50 cents (65 on TBR.V) all day long and PGOL up to 25 cents. There is some good volume on PGOL right now and I expect it will continue this week so capture some while there are some sellers as this is a tight share structure/float. The majority of stock in the float is owned by insiders and/or advisors to the Board (myself-Bob Kopple own close to 10MM shares combined and the president Trevor Newton owns over 10MM himself), which is always very encouraging to see.
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All subscribers if you at least mimic my favorite positions, should have some Patriot, Timberline, and MUX on the books. PGOL/TLRS should be key targets to accumulate this week. I expect many bullish things out of both companies going forward. Enjoy the video and update below. I’ll have more updates out later this week! As usual, I own shares in each company mentioned and may decide to buy more or sell at anytime without notice.
6/29/16
Patriot Gold, Timberline Resources, then McEwen Mining are my three largest US based gold company bets. I’m not buying MUX in the high $3’s right now but will put the spotlight on it when it pulls back and becomes a buy again. TLRS/TBR.V and PGOL are still strong buys at current prices. TLRS can be bought up to 50 cents (65 on TBR.V) all day long and PGOL up to 25 cents. There is some good volume on PGOL right now and I expect it will continue this week so capture some while there are some sellers as this is a tight share structure/float. The majority of stock in the float is owned by insiders and/or advisors to the Board (myself-Bob Kopple own close to 10MM shares combined and the president Trevor Newton owns over 10MM himself), which is always very encouraging to see.
7/11/16
Is it easier to find a low priced stock to triple my money from 20 cents to 60 cents versus MUX going from $5-10? Look at Timberline Resources (TLRS/TBR.V), which is still very cheap compared to the sector and all it has to do is go from 40-80 cents and it will make as much money as MUX from $5-10. This is my rationale, coupled with the fact that my MUX position was getting too top heavy in my portfolio because I’ve made so much money on it!
7/21/16
This overall pull back in the mining stocks and gold/silver is healthy, and welcomed after such a fast and furious start to the year. More to come on best buys but for now know if I liked it before, I still like it now, and buying when the sector pulls back is imperative for the best returns. Timberline Resources (TLRS/TBR.V) is also trading right on its 50 day moving average, which is support. TLRS just announced that they are beginning a metallurgical program at Talapoosa, which is important in moving the 1 million ounce gold project forward.
7/28/16 – note sp to be over $! years end
Next is Timberline Resources (TLRS/TBR.V) which is also hugging its support level, inviting investors to scoop up shares about as cheap as they are going to get on this pull back. I think TLRS doubles by year end and is over $1 early in 2017. A snapshot on the Timberline story can be viewed here(the financing is closed but the video/slider tells the story in 5 minutes):
http://issuer.direct/projects/timberline-resources/
8/2/16
SAND has been rocking since my alert and I will hold this one for much higher prices. One gold junior that is still very undervalued is Timberline Resources (TLRS/TBR.V). Just like SAND has recently, Timberline will have a stretch where it outperforms the sector and plays catch up. Under 40 cents on TLRS is a no brainer, even under 50 cents is a strong buy. TLRS will be an easy double and more likely a 3-5 bagger in 2017 from these levels.
9/22/16 – 9:31am
I am long shares in GUG/TLRS and may buy more or sell shares at anytime and without notice.
9/22/16 – 7:47am
All subscribers should consider Timberline Resources (TLRS/TBR.V) as a junior gold position in your portfolio right now. Below, I’ve linked the company’s September corporate presentation for you to delve deeper. The reason for the follow up is to be very clear, buy .38 on TLRS until it’s gone! The Waterton fund is selling right at .38, which is their cost average (not .37 as I thought). They will sit there like a wall most likely until they are bought out…then the stock will start to fly!
http://timberlineresources.co/wp-content/uploads/2016/09/September-2016_TLRS_TBR-V_Brief.pdf
9/22/16 – 8:21am
While we know there is likely a seller out there around 40 cents, don’t pay too high today/tomorrow. The highest you want to go right now is 45 cents on TLRS and 58-60 on TBR. More prudently, you can likely absorb shares around 40 TLRS and 52-53 TBR. I don’t want to pay Waterton too much as they would likely take a block trade out where they bought it. I refused to put that together because they would give zero discount.
10/14/16
I own nearly a million shares in TLRS and I plan on making $2MM on this investment in the next 2 years. TLRS could easily reset to the 70-80-90 cents per share level even by year end or early Q1. This is one of the few hidden gems of value in the junior gold sector that’s left and I encourage our readers to gobble up a stake while it is dirt cheap. You can safely add shares in TLRS up to 50 cents (TBR.V up to 65 cents). I also expect a European and Canadian investor awareness tour by year end so there will be much marketing of this story after nothing occurring for years. Take advantage on this one….we’re early.
10/20/16
I giggle now thinking back to my videos from Greece in July when I sold 1/3 of my MUX just under $5 and referenced a cheaper mining stock like Timberline Resources as a candidate for the funds. I remember getting accused of being a promoter for TLRS/TBR.V. Well, TLRS has doubled since then and MUX is still down over 20%. Sometimes portfolio rotation makes huge sense if the conditions lines up. TLRS has doubled since July but it is still cheap! I was very pleased to see the news below out this morning.
11/14/16
I won’t keep you guys updated in our 3X ETF trades, but I will reveal that we’ve BEGUN to take a position in NUGT and are out of DUST, as of today. I think we’re getting close to a bounce. If you are a long term investor and not concerned with these intermediate/short term swings, by all means this is a good time to acquire our favorites. MUX, SSV/SSVFF, BVA/BGAVF, TLRS/TBR, SAND, and others are down substantially from August highs, basically cut in half in most cases. Keep in mind, giving up 50% of huge gains for a whole sector, especially in a short period (8 months a triple), is normal. It may not ‘feel’ like it at the moment, but it is and especially for the volatile gold and mining sector.
12/7/16
In summary today, there is big potential for gold juniors to sky rocket again into 2017 and to begin rallying in earnest very soon. Bravada is just one of my favorites but the chart ended up being a good case study this week to show the potential for a fresh 12-20 week rally in the sector. I have been adding to positions the past two weeks in MUX, SAND, BVA, TLRS, SSV, and others covered in premium. In fact, I have a 25% larger position in MUX now than when I sold 1/3 in July at $5.
12/13/16
So far in 2016, every company we privately financed is profitable with several giving us massive returns. Including warrants, investments in SSV, BVA, TLRS, etc have at one time or another been up 4 times, 8 times, and even 11 times our investments! Warrants can greatly boost overall returns in these small companies and the placements are my preferred route to take meaningful positions in companies that I like, versus needing to buy all of it in the open market over weeks or months. For example, I own approximately 4% of Bravada Gold’s shares outstanding and 90% of the stock was purchased through their last 2 private placements, the rest in the open market from time to time.
1/31/17
The cheapest gold junior I know of is Timberline Resources (TLRS/TBR.V) trading under $3.50 per ounce of gold inferred/indicated resources at Talapoosa and Eureka in Nevada. Try and find a Nevada gold play now where you can buy an ounce of gold in the ground for $5 or less….even $10 or less is tough to find anymore. I’ve pasted the news below regarding metallurgical news at their most advanced project Talapoosa. I am planning on increasing my stake in the company to over 1 million shares via the current private placement at 25 cents. If you would like a condensed snapshot of the Timberline story, you can get it here in 2 minutes:
http://issuer.direct/projects/timberline-resources/
Some people have expressed caution/concern around the $1MM option payment the company has due at the end of March. Do you really think I’m going to let that become an issue? I own just under 4% of the company at this point so failure is not an option. The current offering gets them drilling at Talapoosa, pays the bills for awhile, and finances a significant marketing tour in the US, Canada, and Europe starting late next month through March. There are a number of ways to raise an extra million bucks but doing it all in equity at these dirt cheap prices isn’t one of them. I believe after this offering is completed in the next 2 weeks, the stock begins to rise and upon secured financing for the option payment, the stock will soar. This “concern” is the opportunity to buy in cheaply as well. Will they have problems? Will they get it done? I’m betting big that the option payment will be secured, Talapoosa moves forward, the stock goes to 80 cents to $1 within 12 months, and partners step in the develop both Eureka and Talapoosa.
This is a very good opportunity for investors that can be patient if necessary. I’m in this to make a million dollar profit on my share position and am very confident that will happen if not this year then in 2018. I strongly suggest readers absorb any shares available under 40 cents on TLRS and 50 cents on TBR.V. Here is the news:
Timberline Announces Positive Metallurgical Test Results From Its Talapoosa Gold Project
2017-01-31 06:58 CT – News Release
Timberline Announces Positive Metallurgical Test Results From Its Talapoosa Gold Project
COEUR D’ALENE, IDAHO–(Marketwired – Jan. 31, 2017) -Timberline Resources Corporation (OTCQB:TLRS)(TSX VENTURE:TBR) (“Timberline” or the “Company”) announced today positive preliminary results from on-going metallurgical testing being performed on mineralized material at its Talapoosa gold project in Lyon County, Nevada. The testing is designed to confirm the predicted gold and silver recoveries and assess leaching efficiency in the processing of the mineralized material as identified in the Company’s Preliminary Economic Assessment (“PEA”) issued in May 2015. In addition, the testing supports the work of previous operators and will guide planning for additional testing planned in advance of engineering design.
The positive Talapoosa PEA that was completed and released on April 27, 2015 by WSP Canada envisioned the project as an open-pit, gold-silver, heap-leach operation (“Preliminary Economic Assessment on the Talapoosa Project, Nevada, effective April 27, 2015). PEA results included:
Estimated average annual production of 55,000 oz of gold and 679,000 oz of silver for 11 years
LOM all-in sustaining costs of $599/oz gold (net of silver by-product at $16/oz silver price)
After-tax NPV5% of $136 million and 39% IRR at $1,150/oz gold price and $16/oz silver price
Low initial capital requirement of $51 million.
Timberline’s President and CEO Steven Osterberg commented, “The metallurgical testing was designed to confirm, and potentially enhance, gold and silver recoveries estimated in the PEA, which result in very attractive project economics. The testing also provides data to support processes that de-risk the operating plan and confirm the potential to increase recoveries by alternate processing methods.”
Permeability Testing
Metallurgical testing is on-going on four drill core composite samples duplicating those collected and tested in 2012 by Gunpoint Exploration (“Gunpoint”) from the Bear Creek Hanging Wall (“BCHW”) and Bear Creek Footwall (“BCFW”) zones. The BCHW and BCFW zones of mineralized material represent the majority of the Talapoosa gold and silver deposit. Each composite sample was crushed by high pressure grinding roll (“HPGR”) to -1.7mm (-10 mesh), and separated by screening into a fine fraction (-75um or -200 mesh) and a coarse fraction (+75um or +200 mesh).
Saturated permeability was measured in laboratory testing on each coarse fraction under load pressures simulating 200 feet of leach pad height. Compared to the rate of leachate solution to be applied on the heap leach pad as proposed in the PEA, these permeability test results indicate that, on average, the heap leach pad would maintain acceptable levels of permeability at more than 20 times the anticipated application rate of the leachate solution. Based on these results we have concluded that permeability of the heap leach pad for the coarse material is very good.
Column Leach Testing
Two column leach tests of agglomerated coarse material are on-going. To-date, cumulative gold and silver extracted in the leachate solution indicates that recovery trends closely parallel those generated in previous column tests by Gunpoint upon which recoveries were predicted in the PEA (Figure 1). Based on positive recovery slopes and the previous leach trends, it is anticipated that gold recoveries will match or exceed the PEA estimates of 65% for the BCHW zone and 59% for the BCFW zone. The column tests will continue until recovery curves flatten. Silver recoveries also parallel previous trends.
Figure 1. Interim Gold Leach Rate Profiles, Column Leach Tests of Agglomerated BCFW and BCHW Coarse (+75um) Material
To view this figure, please click on the following link: http://media3.marketwire.com/docs/Timberline%20Fig1.pdf
A separate column test of agglomerated fine material is currently leaching and demonstrates accelerated leaching of gold through the initial 10 days (Figure 2). The recovery of gold is estimated to be approximately 80% for gold and 55% for silver, based on extracted solution and head grades.
Figure 2. Interim Gold Leach Rate Profiles, Column Leach Tests of Agglomerated Composite of BCFW and BCHW Fine (-75um) Material
To view this figure, please click on the following link:http://media3.marketwire.com/docs/Timberline%20Fig2.pdf
Bucket Leach Testing
In addition to the on-going column tests on the coarse and fine material, bucket leach tests have been completed on the fine fraction of the combined BCHW and BCFW material to test potential vat leaching of gold and silver.
Final gold and silver leach results after 7 weeks of testing indicate recovery of approximately 82% of the gold and 60% of the silver in the BCHW fine material and approximately 68% of the gold and 66% of the silver in the BCFW fine material (Figure 3). Most of the recovery occurs within the initial 48 hours of leaching.
Figure 3. Interim Gold Leach Rate Profiles, Bucket Leach Tests of Agglomerated BCFW and BCHW Fine (-75um) Material
To view this figure, please click on the following link:http://media3.marketwire.com/docs/Timberline%20Fig3.pdf
Commenting on the results to-date, Timberline’s President and CEO Steven Osterberg added, “The permeability and leach test results are encouraging and demonstrate that effective leaching of finely crushed material will enhance gold and silver recoveries. With the proven and cost-effective capability of HPGR crushing, and available particle separation technologies, we expect that the separate leaching of agglomerated fine and coarse fractions will result in combined gold and silver recovery levels at or above those estimated in the Talapoosa PEA. The potential has also been established to increase gold and silver recoveries through vat leaching of finely crushed material. We look forward to advancing this testing following additional drilling planned for collection of metallurgical samples.”
PEA Disclaimer
The PEA is preliminary in nature and the economic analysis it presents is based, in part, on Inferred Resources that are considered too speculative geologically to have mining and economic considerations applied to them that would enable them to be categorized as Mineral Reserves. Estimates of Inferred Resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. There is no certainty that the economic forecasts contained within the PEA will be realized. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
About Timberline Resources
Timberline Resources Corporation is focused on advancing district-scale gold exploration and development projects in Nevada, including its Talapoosa project in Lyon County where the Company has completed and disclosed a positive preliminary economic assessment. Timberline also controls the 23 square-mile Eureka project lying on the Battle Mountain-Eureka gold trend. At Eureka, the Company continues to advance its Lookout Mountain and Windfall project areas. Exploration potential occurs within three separate structural-stratigraphic trends defined by distinct geochemical gold anomalies. Timberline also owns the Seven Troughs property in northern Nevada, known to be one of the state’s highest grade former producers.
2/2/17
A few noteworthy developments today. First, GDXJ the junior gold miners ETF has broken above its 200 day moving average. This is bullish and I foresee the chart forming a “golden cross” in late February or March, then the technical crowds will jump back on the bandwagon. Things are pretty quiet right now in the sector but it is the time to be making sure you are positioned when visualizing gold and silver stocks trading 3 times higher than they are now, because that is where they are going! Buy after they double again at your own detriment. Get lulled to sleep when you should be awake and you will always lose..just like the rest of the sheep. I have been consistently adding to private placements in my favorite gold juniors like Bravada Gold (BVA/BGAVF) and Timberline Resources (TLRS/TBR) so I get warrants and discounts to market.
2/7/17
The two uranium juniors were up 9% and 24% yesterday, respectively. So, to kick off our week, our short focus list of 4 companies were up, 9, 15, 24, and 45%! Many investors would kill for those returns annually much less in one session. One of our free picks was up 9% yesterday as well but on low volume. That is Timberline Resources (TLRS/TBR.V) which closed at 34 cents on TLRS (it is a US company so I reference the US ticker prices…when it’s a Canadian junior, I speak in CDN price quotes).
Timberline
Timberline is going to see an explosion of it’s own soon. I say this is the cheapest junior gold play out there not only because of the low value of gold resources in the ground versus market cap ($4 an ounce). Mainly I say so because of the huge disparity in share performance versus the sector over the past 12 months. If you look at the weekly chart of GDXJ, a proxy for juniors, it is trading about 30% above its 200 week moving average. this is common across the sector give or take.
Timberline on the other hand is trading nowhere near its 200 week moving average! If it were moving just on par with the rest of the gold juniors at a 30% premium to the 200 WMA, it would be over $1.30 per share on TLRS….$1.70 on TBR.V! There is absolutely nothing in TLRS’s assets or capital structure, etc to merit such an enormous disparity in valuation. This means that there is a high possibility that we will see a value reset at some point in the future in the Timberline share price. Maybe it will be after they pay gunpoint the $1MM option payment they owe, maybe it will be when they start drilling Talapoosa again soon, or maybe it happens on no news because someone sees the opportunity and buys up a ton of stock.
I don’t know which catalyst will do it but I’m confident that the huge gap in value will at least be cut in half this year. That would mean a doubling of the share price minimally not including any normal rise in the sector. If TLRS catches all the way up to GDXJ and its peers, it would quadruple. If this was a 10 or even 30% disparity it wouldn’t be that big of a deal but this one is yuuuuuuge and it will not last like this. Long term investors looking for value in the junior gold space should be buyers of TLRS under 40-45 cents and TBR.V to 55-60 cents.
For accredited investors that like the opportunity, you should contact the company (or email me and I’ll introduce you) to see if you can participate in the current private placement at 25 cents, which is now more than a 30% discount to market prices. It also includes a full 3 year purchase warrant at 40 cents as an additional sweetener. This is the best way for wealthier individuals to take stakes in junior miners in my opinion, when the opportunity comes up. The company will close a first tranche of the financing later this week but there is still some left.
The end
He’s wildly long TLRS and he may be right. But cheerleading is not going to get the financing done. I don’t doubt that the project will attract money, but they need a lot of it and it is unclear how present shareholders will be affected.
As I have said from the beginning, the project and its valuation look good.
But they need not only $1 million by March 31, they need another $2 million in 12 months then $8 million 12 months after that. Saying that you have faith they will find the money is fine, but it is not enough for me.
I have no issue with those who are persuaded. It’s just that I myself am not.
The concern is warranted, there is no guarantee the project will survive that balloon payment in two years. I think what is most likely is….. they have the time to finish the metallurgy they need to do and attract a buyer or partner before that deadline, and this asset will eventually get a much better monetization. For the speculative portion of my portfolio, I look for things that I think could double within a year or less, then I can cash out half. I put a bet down here, so we’ll see if it works out.
I agree, the deposit looks good enough to attract someone.
I like Northern Dynasty, I see the EPA strangle hold loosen up with Obama out and President D. Trump in. President D. Trump has already given the pipeline the go ahead, and see the mine will be right behind it!
I know you are big believer in NAK. I would be also, except that I have not seen any evidence that the huge amount of gold and minerals on their property can be extracted economically.
Maybe you could persuade on this point ?
I hear lots about the political climate improving, the permit situation being solved, the big names promoting the stock, and the large amounts of wealth in the ground. But I have not seen any persuasive indication that a profitable mine can be built.
Gross resources in the ground must be in a concentration and configuration that lend themselves to extraction at a profit. Are we going to need and open pit mine the size of Iowa to get the gold out ?
thinairmony…I will be delighted if I am wrong about $NAK, and you are right.
But let me ask you some questions.
1. If all the permitting and licenses and approvals are applied for granted, when will the theoretical
mine go into production ?
(answer: 2024)
2. I realize that years of study and over $700 millions of dollars have already been invested in this project.
So after all of that toil and treasure and time, how many ounces of proven and probable mineral reserves
have been established ?
(answer: zero)
3. After hundreds of millions of dollars and years of study, why is there no mine feasibility study ?
(answer: I don’t know)
3. What are the grades of copper and gold that are in the resource estimates ?
(answer: look it up)
4. Production is not going to occur for seven years, at the very earliest. How much capital will Northern Dynasty need in the next seven years, without any source of income other than from investors ?
(answer: a whole lot)
5. What is the forecasted AISC for production of an ounce of gold ?
(answer: I don’t know)
How much gold is forecasted for production in the first 10 years of mine life ?
(answer: I don’t know)
Investors may do very well with Northern Dynasty. They put up a very slick website with impressive numbers (except for their ore grades and lead times) and have a lot of big name promoters. People may make money buying and selling the stock. But seven years is a long time, and my guess is that one’s investment capital is going to get chewed up pretty badly by the time they produce anything. It has already eaten up over $700 million of investor capital, and they don’t even have the permits to build a mine.
It is not personal and I hope anyone in NAK does well with it. But it is not for me.
You nailed it. Compliments.
High ceiling, low floor play, but too far away for me.
People may may make money buying and selling this stock. But Northern Dynasty is going to spend more money on sales promotion, lobbying, and pictures of Chinook salmon in the next five years than they are going to realize in sales of gold.
I’d guess more like ten years for an actual mine, assuming they are ever allowed to mine. Permitting would take close to five years, and construction would be hugely complex and time consuming. This isn’t really a mining speculation (for me, at least), it’s a regulatory and partnering speculation. My warrants will expire long before any metal could be produced.
$NAK…News from ten years ago. This year the stock has gone from 20 cents to $3.50. Nice ride, maybe it will go to $5 or $10. But I won’t be owning any. They are a little behind schedule.
Sincerely, good luck to those who are in it.
October 4, 2007 – Ronald W. Thiessen, President and CEO of Northern Dynasty Minerals Ltd. (AMEX: NAK) is pleased to provide a Pebble Project update. As announced on July 31, 2007 a wholly owned subsidiary of Anglo American plc (“Anglo”) became a 50% partner in the Pebble Project with a wholly owned affiliate of Northern Dynasty Minerals Ltd (“Northern Dynasty”)[forming the] Pebble Limited Partnership… For Anglo to retain its 50% partnership interest, it will need to invest the next US$1.425 billion in project development costs. Northern Dynasty owns an equal 50% interest and is carried during Anglo’s investment period. The goal… is to engineer, permit, construct and operate a modern, long-life mine at the Pebble Project. The partners are targeting completion of a pre-feasibility study in December 2008, a feasibility study by 2011 and commencement of commercial production by 2015.
I won’t be loading up on NAK, Just my opinion, each to their own. Whatever your position I hope it turns out well. Far to complicated imo but what do I know?
Kerrisdale Capital Releases Negative Report on Northern Dynasty Minerals Ltd. (NAK) and Announces Conference Call Schedule- Northern Dynasty’s key asset, the low-grade Pebble deposit, is not commercially viable: mining it would require so much upfront investment that it would actually destroy value- Kerrisdale believes Northern Dynasty’s former partners concluded that the Pebble project had a negative present value – an assessment that Northern Dynasty has spent years trying to conceal from the public- Frenzied investor enthusiasm over the benefits that the Trump presidency will bring to the Pebble project overlooks the ineradicable threat of a veto from either the Alaskan government or a future Democratic White House
PR NEWSWIRE 9:30 AM ET 2/14/2017
I don’t really care that not all the factors are in place, and this is also the reason why the price has been priced very low. I’m looking at NAK from a different perspective and I’m following it very closely from day to day. For me it’s a matter of risk-reward, and that’s why it’s been a no-brainer for me. When I saw that that numerous newsletter started covering the company even more, and increased my position and this has been a wise decision for a nice short-time gain. Recently I took some profits (aprox. 700% in total), but I still have a decent position.
Like I’ve written before I advice members interested in this company to have a listen to all of the different podcast of Frank Curzio that has covered this company. Maybe you HN will get a better impression of Northern Dynasty, and maybe there will be presented additional information that you won’t be able to read from their “slick” webpage? Information that I have received from investors actually inspecting the area in person, and “boots on the ground”, can be pretty useful compared to analysts just looking at the numbers and a limited public information.
If David Lowell says this is the best project he’s seen all-time, Marin Katusa decides to own 10% of the company with Doug Casey, Rick Rule etc…..well, then it’s good enough for me to take a small position that I was prepared to loose; no matter if NAK lacks PEA, proven resource etc. I also don’t care if it will take years to build this mine since I will most likely would exit my position before this. It all depends on the angle and strategy you decide to take.
It may be an excellent project. Go for it. The stock has gone from 20 cents to $3.50. Obviously a large number of people believe in it.
But where are the figures supporting it ?
What objective information can you provide ? 2P reserves ? Decent grades ?
Reasonable timeframes ? How about an AISC, or a production forecast ? How about a forecast for capital needs over the next five years ? How about anything relevant to the costs of the project between now and that wonderful day when they pour gold ?
If Doug Casey and Katusa and Rick Rule are in it, that does mean something to me. I respect these guys, but I will not invest solely because someone who has runs newsletters or funds has done so.
We do not know their cost basis, or how many warrants they have; they are promoting their own book, and perhaps with justification. But I do not have the opportunity to enter at the price they have, and neither do you.
I am not saying the stock will not do well. I am only saying that I see no evidence in anything I can find that the deposit will convert to a profitable mine in the foreseeable future. A seven or ten year time horizon is a little long for me. And I am sincere in wishing $NAK longs success. There are just too many unanswered questions in it for me.
HN – I would consider your observations about $NAK and $TRLS to be more the distillation of experience, than investment advice. Advice is one thing, Wisdom another.
No advice given, just opinions and positions.
I’ve been wrong on a lot of things and I may be wrong on NAK and TLRS.
I’ll be the first to admit it. I’ve said all along one may be successful on the stocks.
Actually, HN, the process is of greater interest to me than the result. It is the gathering and analysis of available data that is the key. How the market reacts is entirely a different matter – sometimes quite randomly.
I would add “sometimes emotionally” to your comment, petervr. 🙂
Kerrisdale Capital Releases Negative Report on Northern Dynasty Minerals Ltd. (NAK) and Announces Conference Call Schedule- Northern Dynasty’s key asset, the low-grade Pebble deposit, is not commercially viable: mining it would require so much upfront investment that it would actually destroy value- Kerrisdale believes Northern Dynasty’s former partners concluded that the Pebble project had a negative present value – an assessment that Northern Dynasty has spent years trying to conceal from the public- Frenzied investor enthusiasm over the benefits that the Trump presidency will bring to the Pebble project overlooks the ineradicable threat of a veto from either the Alaskan government or a future Democratic White House
PR NEWSWIRE 9:30 AM ET 2/14/2017
Didn’t they just get a buy-in for $25 mm that maybe was raised to $34mm?
I sold half of my NAK at a nice gain recently, bought some back a couple of days ago, but it is down a bit again today, along with the rest of the market. The chart looks like a normal correction but needs watching.
NEW IDEAS IN COMMODITIES…before presenting a few new ideas, a recap of my outlook.
My opinion of our macro outlook is that we will eventually have some significant inflation, which the Fed has been miserably ineffective at generating despite flooding the world with printing press dollars. My opinion is that the astronomical numbers of dollars in inflated assets, petrodollars, and central bank holdings, plus the continued
printing press and program mentality of the Powers that Be, Trumpian or otherwise, will eventually result in further US dollar devaluation and price inflation in basic commodities.
I realize that the USD still looks pretty good compared to the other currencies. But that is not saying very much.
Hence my predilection towards hard assets, which has been the foundation of my continuous blathering about gold, silver, copper, zinc, cobalt, platinum, real estate, and other hard assets.
I have been very interested in finding ways an armchair-based retired guy like myself can invest in food and farmland without venturing into the wild and woolly world of commodity futures or starting a micro-farm.
This interest has led me to a few new ideas. I am pretty close to opening positions in them, but stop short of declaring them to be recommendations…I submit them here to bounce them around and to hear from you all what
perspective and opinion you might have. I’m running them up the flagpole to see if anyone salutes.
INPUT CAPITAL CORPORATION…INPCF…this company caught my eye because they are a royalty streamer and producer financier, like Sandstorm Gold, Franco Nevada, or Silver Wheaton. Instead of precious metals producers, Input Capital applies the royalty/streaming model to farmers, and lending money in advance and taking in agricultural products, specifically in canola. I suppose they also hedge and cover themselves in the futures markets. The farmer delivers canola against contracts with Input Capital, instead of repaying in cash.
This is a new finance model in farming. Like miners, farmers face large capital needs in advance of actual production, and for various reasons traditional bank financing has unattractive characteristics for both the lender and the borrower.
I have had my eye on them for a while. They seem to be thriving, they have a narrow focus in the central Canadian canola belt, and know the local farmers and the canola market inside and out. I like this specialized focus, but they can expand their concept from a very strong fortress-like base in their home territory.
The company has a market cap of $130 million or so. The stock has seen a low a little over a dollar, and a high in the mid-$2.00 range. Now around $1.50. And get this…they pay a dividend !
UPSIDES. Input Capital could appreciate nicely under several scenarios. First, they seem to be growing their core business. It is a new company and things are going well. Second, it seems to me that this model, if successful, can be expanded to other commodity producers. So there is potential growth into other agricultural sectors. Third, any sustained price appreciation in canola oil or feed will have a dramatic impact on the profits and valuation of Input Capital.
DOWNSIDES. A crop failure or a drop in canola prices will be a bad thing for Input Capital. Also, there is controversy on the health aspects of canola, and the crop will be the epicenter of any fuss about GMOs, because canola itself is a man-made species, and most of the canola crop has been tinkered with by Monsanto.
****
CME Group…as a believer in commodities, CME Group would have been a natural consideration, if I had ever heard of them. Which I had not, until I read an article by a webmeister named Soren K, who is editor of the Marketslant website. He is a very bright analyst and I have followed his commentaries sporadically; he is a sometime contributor to Kitco, my go-to gold and silver site.
Anyway, Soren said that if you want an inflation hedge, he considers CME group to be the superior global choice
of inflation hedges. CME runs the commodity exchanges in Chicago and owns a bunch of other exchanges, so they profit on almost everything that is traded, whether it is gold, timber, cocoa, pork bellies, Exxon Mobil, Pfizer…whatever.
Soren uses extreme expressions for this stock, like “the one-and-only-best-hands-down-slam-dunk-inflation hedge-that beats-all the others”. I checked the financials, they are insanely profitable. Since they rely on trading volume and transactions, we don’t need to worry too much if prices go up or down. Some things will go up and some will go down, but contracts and securities will be traded, and CME will get its cut.
The stock is trading for $118, it has doubled since last year. This would be quite a change for me, usually my picks are closer to $1.18. But I like the idea, although as I say have not done enough due diligence to make the investment, or say that I recommend it. Just kicking tires right now. Feedback welcome.
INCPF, CME no position
$INP.V Interesting. Travis has also previously covered Input Capital.
Copper as an economic indicator; copper breaking out; metals outperforming
http://www.kitco.com/commentaries/2017-02-10/Dr-Copper-Signals-Rising-Inflation-Ahead.html
This analyst agrees with my unreasonable, biased and pig-headed outlook on metals, in particular copper.
IN CASE OF A NEAR-TERM RECESSION
I’m interested for opinions on how much base-metal AND gold/silver-shares could decline if this were to happen, and if anyone has any exit-strategy for this…or are you sitting put since probably gold/silver stocks would “normalize” within a relativity short time?
The safest thing is to assume that a recession could be similar to the 2008-9 downturn, which caused dramatic downturns for all metals and mining stocks, and drove many junior miners down 90%.
It could be a different sort of recession, of course, and it’s possible that precious metals could do OK versus the dollar of the dollar collapses, or that miners won’t be as capital-starved as they were in 2009-10… but the safe assumption would be that the next downturn might be as bad as the last one.
Just keep your trailing stops and follow them when hit is the safest strategy. You can always get back in when/if they turn up. Transaction costs are so low now that this makes for a valid strategy.
The other way to go is to just sell out your original cost share equivalent and take a “free ride” with the profits. That way you are still in and cannot lose money on the position.
There are pros and cons for both methods but either way you have protection from riding your position all the way down…..
You can hedge by buying put options for an equivalent number of shares you are trying to protect.
For example, if you are long 200 PVG, you can buy 2 put contracts that are near-the-money; this can be done for any of several time frames, depending on your outlook. This strategy is very expensive if you have a lot of positions.
An alternative is to buy puts on one of the indexes. The quantity, strike price and expiration need to be considered, and what is suitable depends on how severe you think the pullback will be, and how long you think it will last. To hedge, the underlying value of your contracts needs to be approximately equal to the value of your gold holdings. You could also buy long-dated, out-of-the money puts at a strike place well below current levels, in quantities in excess of your gold positions. This will ensure a big gain if there is a real disastrous price crash. You are more likely to lose it all, but you can look at it as an insurance premium payment.
If you are really nervous, then get out of the positions or reduce them. Preferably beforehand.
Colorado Resources Feb 10 2017.
http://comanusrising.com/
In this episode of the Stateside Report Podcast we introduce our new sponsor again Genesis Metals GIS, talk about the CEO.CA app and the developments this week, we talk about the week in gold and gold stocks and the base metals, we introduce a new feature on volume and percentage gain leaders from the Friday trading and wrap up with news from the Canadian junior exploration stocks including: Colorado Resources CXO,
Tomorrow morning I will make what may be my final move for some time, then I think my portfolio will be honed for the year. I will sell out my position in AG. That was not a company I wanted to hold long term, but one of those opportunities where I saw it get oversold, and knowing its volatility, thought I could get a few points. I didn’t act fast enough to jump on it when it touched under 7 for a moment, But I did get it at just above 8, and cash it in for a 31% gain in 6 weeks. I use that and some other profit taking trims to take a position in MRLDF, and finish my accumulation of CTEQF. I am taking a large position in CTEQF because 1. I think the sky is the limit for their technology and 2. getting in at half a buck or so could work out awful well and 3. it isn’t a freaking gold stock.
I am armed for bear if gold rises, but also taking leverage off after this beautiful run. I know this is basic, but friends, nice long rallies can be a great time to take a few profits, then buy the dips. To illustrate how powerful that concept is, my gold and silver portfolio, which I initiated in january/16 [yes, the renbycage neurosensorytingle strikes again] is presently very close to my highs, even with gold about 140 dollars lower than its high during this interval. That is because of small adjustments I do, selling the rallies and buying the dips. These “legs up” kind of bullet proof your portfolio, makes it strong for the downturns.
Long in order of present position SAND, SA [too much, will trim substantially at target 12], RGLD [biggest winner already cashed in huge profit and still #3 position], CTEQF, IVPAF, FNV, MRLDF, and half positions in CLASF, MWSNF, SSVFF, TLRS.
Very similar except I do not own your last three. I have slw, nc elf, mag and erdcf, and a full position in PVG; no RGLD though I like it. We are on the same page
I know we are on the same page, a couple of them I was led to here, because reading your stuff I see you know how to think, I love it, and my own DD says looks right to me. SAND and SA I had before coming here, and were two of my first 4 gold picks, with RGLD and FNV. The rest I’ve mostly added in late december, early january courtesy of cashing in 2/3 of my RGLD, that was a big play and a big win for me, put it in the category of irrationally anomalous below book value underpriced with zero downside that I bet half the house on and scored 140%. I really think we are going to do well with CTEQF. I have kind of a spider tingly sense, when I take in the gestaldt of a company, and my hairs kind of stand up all over my body. When I get that feeling, it usually is a very good thing, so I backed up the van [which is like a half of a truck, and I don’t mind being patient with it if I have to.
Whatever works for you. I am not a very good trader, longer term positions are better for me. I miss big legs up and chew up gains with bad entires and exits.
I trade with a small percentage of my portfolio, or make adjustments from time to time, but mostly want stocks to hold for longer term. Now I have honed things where I want them for this year, I will trend to keep everything for the rest of the year, and most of what i have for 2-3 years at least, while keeping a close eye on things for danger signals, changing circumstances, and opportunities. The penny speculative stocks are the ones I like to pump a double and dump a half, but honestly, every decision is based on multiple unique factors. I find precious metals investing presents opportunities for great multiplication of wealth, but needs to be managed much closer than your average stocks. The volatility in the sector does not amend itself to super long term passive buy and hold, IMO, but more of a play the cycles. But even in a long term bull cycle, and especially in a long term bull cycle, you can multiply and also insure your portfolio by lightening up a little during the rallies, and fattening up a little at the troughs, small adjustments that just tilt the odds a bit more in your favor, without throwing off the general vector of your portfolio.
Another way to insure your portfolio is using a trailing stop loss, so you always sell when it goes down a certain fixed percentage from its high. But in that method, you are always selling when it hits a targeted low, and in my way of thinking, its better to lighten up when you get a bit overbought, not oversold.
LONG – Lexam VG Gold (TSX: LEX, OTCQX: LEXVF)
MCEWEN MINING ANNOUNCES FRIENDLY ACQUISITION
OF LEXAM VG GOLD
February 13, 2017, Toronto, Ontario, Canada: McEwen Mining Inc. (“McEwen Mining”) and Lexam VG Gold Inc. (the “Company” or “Lexam”) (TSX: LEX, OTCQX: LEXVF), have entered into an agreement pursuant to which McEwen Mining would acquire all of the issued and outstanding securities of Lexam by way of plan of arrangement (the “Arrangement”) and Lexam would become a wholly-owned subsidiary of McEwen Mining. The proposed arrangement is subject to approval by the shareholders of Lexam.
Pursuant to the Arrangement, each Lexam common share (a “Lexam Share”) would entitle the holder to receive 0.056 of a McEwen Mining share (the “Exchange Ratio”). Lexam shareholders would receive a premium of 30% to the 30-day volume weighted average price (VWAP) of the Lexam Shares.
“Lexam’s assets include multiple advanced exploration projects located in the prolific gold camp of Timmins, Ontario. Lexam’s primary projects are past producers with defined resources and excellent infrastructure. The proposed transaction would give the Lexam shareholders access to McEwen Mining’s technical and financial resources enabling the projects to be advanced towards production. Lexam shareholders will also gain exposure to a growing gold and silver producer, with a diversified portfolio of projects throughout the Americas” commented Rob McEwen, Chief owner of both McEwen Mining and Lexam.
Benefits of the Transaction for Lexam Shareholders:
1) Ability to fund development and construction of the Timmins Properties with McEwen Mining’s existing financial resources;
2) Access to McEwen Mining’s experienced and disciplined management team with an accomplished history in gold exploration, open-pit and underground mining, and mine development;
3) Exposure to McEwen Mining’s diversified portfolio of producing operations and development projects; and
4) Lexam shareholders receive an attractive premium of approximately 30% to the 30-day VWAP of the Lexam Shares and greatly enhanced liquidity of dual stock exchanges within the US and Canada.
Benefits of the Transaction for McEwen Mining Shareholders:
1) Adds Measured and Indicated gold resources of 1,468,500 ounces and Inferred gold resources of 954,000 ounces to McEwen Mining’s resource base in a premier geopolitically stable mining jurisdiction;
2) Enhances McEwen Mining’s development and production pipeline with the potential to commence production of the Timmins properties within 24 months; and
3) Substantial exploration potential
Further Details on this Deal to be found here:
http://www.lexamvggold.com/pressreleases/2017/2017_02_13_LEX_Press_Release-Final.pdf
ksand52, beat me to it. Thought I saw this one coming. Now to take a position in $BXTMF before McEwen acquires it.
$MUX, $LEXVF long
$MUX – McEWEN MINING ANNOUNCES FRIENDLY ACQUISITION OF LEXAM VG GOLD
http://www.mcewenmining.com/Media-Events/News-Releases/News-Releases-Details/2017/McEwen-Mining-Announces-Friendly-Acquisition-of-Lexam-VG-Gold/default.aspx
Long Lexam VG Gold (LEXVF) also Long Brixton Metals (BXTMF)
Fair bet that McEwen would eventually take over Lexam he already was Non-Executive Chairman, Director ( and largest shareholder of Lexam VG Gold) . Brixton Metals will probably take longer, they are early in the process and still need to prove themselfs economically viable.
Like McEwen and MUX but no position. Lexam no position…I was long but sold it for more Ivan and silver.
You can’t own everything.
$NMKEF – Nemaska Lithium Achieves Phase 1 Plant Milestone and Triggers $3M Installment Payment from Johnson Matthey Battery Materials
http://www.nemaskalithium.com/en/investors/press-releases/2017/5b336a1b-9ad2-41fd-a03b-75db3d28b2be/
NMKEF long
Also Long Nemaska Lithium – (NMKEF)
$CLASF – COLORADO RESOURCES LTD. (TSX-V: CXO) (“Colorado” or the “Company”) announces further to its news release of January 20, 2017 it has received the approvals from the Ely Ranger District of the United States Forest Service for the updated drill permits for the Green Springs Property and drilling has now commenced.
http://www.coloradoresources.com/s/NewsReleases.asp?ReportID=778428&_Type=News-Releases&_Title=Colorado-Commences-RC-Drilling-at-Green-Springs-Nevada
CLASF long
A Trip to Seattle, Tales of the Yukon, and a new Exploration Speculation
Last summer I took a great trip to the Pacific Northwest. I spent some time in Vancouver, and in Seattle. In Vancouver, besides taking the normal touristic activities, I made an “investment tourist” stop to the headquarters of Sandstorm Gold and a few other resource companies…no hard-core due diligence, just looking around seeing if they were for real, and hoping to pick up a few scraps of insight. My trip was successful in that respect: I got a few facts and impressions that deepened my conviction on a few of my existing picks. Then I went for Chinese food.
In Seattle, I had no such intentions. I was purely a gawking tourist, with no ulterior investment motives. I spent a few beautiful days walking about, buying picnic lunches of fresh salmon and Washington fruit at Pike’s Market, taking ferry rides, taking in the sights, and watching the Mariners play a baseball series against the New York Yankees, who at that point still had remote hopes of a pennant.
***
Walking from downtown Seattle to Safeco Field to watch the baseball game, one strolls through the Pioneer Square district. It is Seattle’s Old Town, and an interesting zone for a tourist. One of the attractions there is a small US Forest Service Museum devoted to the Yukon Gold Rush of 1896. It’s free.
The museum was interesting. There were displays, artifacts, old media, and presentations that gave a great flavor of the intense frenzy that the discovery of Yukon gold created across the country. It turns out the Yukon Gold Rush was largely responsible for the establishment of Seattle as a major city, along with the civic promotion of an individual who marketed Seattle nationally as the best embarkation point for Yukon gold seekers headed to the Klondike. San Francisco’s pro football team is the 49ers, from the 1849 gold rush; Seattle’s Seahawks could just as well be nicknamed the “96ers”.
It is hard to imagine the frenetic activity of the gold rush. Tens of thousands of men and women dropped everything and charged off to get to the Yukon and strike it rich. Thinking only of the possible end of finding gold and striking it rich, they quit jobs and families with no notice. Most had only scant preparation, and many had none. They had no idea of the hardships of the journey, the remoteness of the location, the harshness of the terrain and climate. They knew nothing of geology, geography, or mining. Yet in their frenzy to find gold, they came in the thousands.
The majority failed; many died. A few of the tens of thousands struck it rich and returned from the Klondike with astounding quantities of gold. The stories of the wild and desperate free-for-all to find gold in the Yukon has become legendary.
In 1899 the frenzy died down after the easy gold was found. A few disappointed prospectors made fortunes in other endeavors, notably a disappointed shoe merchant named John Nordstrom, whose enterprise became a national department store.
From what I have read, in some places the ground was actually covered with a thick gold paste. You could just pick it up off the ground. And of course the rivers and streams could be panned. Basically, you could get rich walking around with a pan and a pick ax.
****
The technology for mining prospecting has advanced a lot since 1896. Many mineral deposits nowadays could not have been discovered a century ago, let alone exploited. One thinks of Oyu Tolghoi, deep and enormous underground; or the Diavik diamond mine, dug into a swampy tundra in the remote Arctic; or the offshore drilling rigs of Transocean; or any other number of mines: some vast open pits, some going kilometers underground.
One thinks of the easy riches of 1896 in the Yukon, and wonders…how much more gold is there, that might be discovered and exploited with modern technology ? How much is underground, undiscovered, that the rough men with snowshoes and pickaxes and mules were unable to find 120 years ago ?
****
It so happens that people are looking. There have been some recent transactions in the Yukon. Gold investors may recall a recent buyout of Kaminak. This involved a Yukon property. A few majors have projects there.
Which brings me to an exploration speculation: White Gold: $WGO in Canada, $GRFGR.
White Gold is an exploration company concentrating in the Yukon district. It has a market cap of about $75 million. The CEO has acquired a large package of claims in the Yukon that altogether total about one third of the land area of the district.
There are a few things that I find interesting besides the geographic spread of the claims. First, the principal is a student of the historical mining there. Second, the company is 19% owned by Agnico-Eagle, which was one of my favorites when I believed in big cap miners. One gets the feeling that Agnico Eagle is using White Gold as their exploration team in the area. And third, White Gold has a very interesting technological edge: they are using drones to drop drill rigs and do drilling. It is a very efficient method of getting rigs to remote locations, and they claim it substantially reduces the costs per meter of drilling; and drill cores are basically what White Gold produces, since they are explorers.
GEOLOGY AND DRILL RESULTS. White Gold claims that the area was unglaciated, and that because of this surface soil samples bear a greater correspondence to below-ground lithology than in other places.
They claim that, in general, the sample qualities at the surface continue at depth. The findings so far are decent but not enough to make you jump out of your chair and call a stockbroker…pretty good for open pit, like 2-4 grams per ton. Not enough to trigger a world-wide gold frenzy, but not bad.
That’s pretty much it. Not a lot to go on, but what do you expect for a market cap of $75 million ?
There are a few other prospectors up there, but I am liking White Gold and may put a few bucks into it.
White Gold is a discovery and exploration speculation that may work out, and may not.
Is there any timetable of expected outcomes?
Thanks HN
Absolutely no timetable or prediction of any kind.
Strictly a speculation. There may be some residual value in the drone drilling abilities.
Kerrisdale Capital Releases Negative Report on Northern Dynasty Minerals Ltd. (NAK) and Announces Conference Call Schedule- Northern Dynasty’s key asset, the low-grade Pebble deposit, is not commercially viable: mining it would require so much upfront investment that it would actually destroy value- Kerrisdale believes Northern Dynasty’s former partners concluded that the Pebble project had a negative present value – an assessment that Northern Dynasty has spent years trying to conceal from the public- Frenzied investor enthusiasm over the benefits that the Trump presidency will bring to the Pebble project overlooks the ineradicable threat of a veto from either the Alaskan government or a future Democratic White House
PR NEWSWIRE 9:30 AM ET 2/14/2017
$NAK…the credibility of those promoting it will also take a pretty bad hit.
Big time. And the most credible voices here a boost. Great timing from both you and travis on astute analysis of that investment.
The credibility of Travis, Henrixnuzzles, and many other Gummies are fully deserved. In the particular case of $NAK, their skepticism seems to make much sense, at least for me. However, it is interesting to read the response that news letter promoters have published following the release of Kerrisdale Capital report. So, here is one specific response, the one from Porter Stansberry:
————————–
Because we received several questions from subscribers, we’d like to share some highlights from the update with Digest readers today.
In short, Porter’s team studied the report and were on Kerrisdale’s Tuesday conference call. They believe the firm’s allegations are inaccurate at best… intentionally misleading at worst. From the update…
Kerrisdale offered no new technical or scientific evidence. On the call, they labeled themselves as market generalists with no background in the mining industry. They made vague references to engineers, but would not disclose their names or credentials.
One of their main arguments is that mining giant Anglo American and other large miners walked away from the project because Northern Dynasty’s resource is worth nothing. We disagree.
Anglo, a major London-based miner, didn’t pour more than $500 million into a project that it thought was worthless. On the contrary, a half-billion-dollar-plus investment requires dozens of qualified experts with estimates of massive potential. The large investment demonstrates the potential Anglo saw in Northern Dynasty.
Kerrisdale claims Anglo walked away because they thought the mine was worthless. But they offer no evidence or contact at Anglo for this position. The fact is, only Anglo’s management knows why they pulled out of Pebble…
We suspect Anglo’s tenuous financial position at the time, coupled with a declining gold price and low prospects of regulatory approval under the previous government administration were taken into consideration in their decision process. As far as we know, neither Anglo nor any other major mining company has ever stated that Pebble has no potential… as Kerrisdale is claiming.
As Porter’s team noted, the firm wasn’t denying that Pebble is the largest undeveloped gold and copper resource in the world…
It is simply claiming it will never be economically or technologically feasible to mine. Yet they believe this argument is flawed. More from the update…
There is no doubt that Pebble will require billions of dollars to develop. But with 70 million ounces of gold, 344 million ounces of silver, and 57 billion pounds of copper measured and indicated in the ground, those capital requirements don’t seem so daunting… A $100-per-ounce increase in the price of gold alone raises the project’s value by $7 billion… completely changing the picture of high development costs. And while Pebble is a massive low-grade deposit, it’s possible to mine it with cheaper “open pit” techniques…
Kerrisdale claims that the technology to conduct environmentally safe operations at Pebble does not exist. They gloss over the fact that similar massive mining operations are being carried out around the globe daily. And they disregard a plan that Northern Dynasty spent $150 million developing with the help of over 500 scientists and technicians to make mining possible… and without damaging the Bristol Bay.
Finally, Kerrisdale disregards what a Trump Environmental Protection Agency (EPA) might say on Pebble. Let us say this… having the president and EPA opposed to granting a permit is not conducive to investment. The fact is, the previous administration placed roadblocks on Pebble. We expect that will change under the Trump Administration.
Kerrisdale argues many politicians and environmentalists worried about Bristol Bay are still opposed and the permitting process will take years to complete. On this, we agree. But we never invested in Northern Dynasty based on the company actually developing an operating mine…
We recommended Northern Dynasty as a speculation that the regulatory roadblocks would go away, so that a mine is at least feasible. And we recommended Northern Dynasty because of its massive resource, giving us tremendous leverage on a rising gold price. When gold prices go up, the value of the metals in the ground also goes up, whether they are being mined or not.
They also note that when Kerrisdale analysts were pressed for details on the conference call, they stated they have no hard facts to back up these claims, merely opinion. And the firm is clearly biased…
By holding a short position on the stock, they make money as Northern Dynasty’s stock falls. Kerrisdale’s timing on the release of the report is suspicious – coming days after the stock reached a 52-week high.
On the other hand, Stansberry Research has no financial interest in Northern Dynasty’s stock price. We provide independent and objective research, report our findings, and make our recommendation. As a subscriber, you will always get our honest opinion.
Perhaps most damning, Kerrisdale itself has a less than stellar track record…
As Porter’s team noted, the firm’s manager is notorious on Wall Street for bad calls and bad judgment…
He’s been famously wrong about a major bet to short shares of DISH Network, and last summer he was arrested for DUI and cocaine possession after a serious car wreck that injured another driver.
His method of doing business – to short a stock and then use social media to bash the business – is, at best, questionable. We have nothing against short sellers. In fact, we recommend shorting stocks frequently when we have serious doubts about their balance sheets, their businesses models, or their accounting practices. We express our doubts objectively (not after we’ve made a big investment) with careful research and facts – not hyperbole and conjecture.
We think investors should be very skeptical of investment research that’s published by any entity whose business depends on promoting a position (long or short) after establishing one – whether it’s a hedge fund manager with a history of drug abuse or an established industry titan. The fact is that having a bunch of money on the line (like Bill Ackman with Herbalife) tends to warp investors’ judgement.
—————————–
$NAK rebuttal by Stansberry…the rebuttal is worthless. The issue is whether the deposit can be mined economically. The only valid rebuttal would be a PEA or PFS by a competent third party that shows how a profitable mine could be built there, or a set of drill cores that show decent CONCENTRATIONS of economic metal that would give hope of a profitable mine.
Environmental, permitting, or political issues
are completely irrelevant to this key condition, which appears to be lacking at Northern Dynasty.
Somehow after spending three quarters of a billion dollars, the management at $NAK is unable to show
even one ounce of proven or probable reserves, and has not been able to produce any objective data showing reasonable mine economics.
The contrary interests of Stansberry and Kerrisdale
need to be considered but have nothing to do with the geology or mine economics.
In this case I would say that the burden of proof is on the promoters of the stock and $NAK, and not on the side of those who are skeptics.
Here is an update on the NAK issue. Read carefully contains meaningful information.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
Update: Northern Dynasty
February 14, 2017Update
Shares of our gold-stock speculation, Northern Dynasty (NYSE: NAK), were down sharply today after investment firm Kerrisdale Capital wrote a negative report about the company…
It’s important to note that prior to releasing the negative report, Kerrisdale initiated a short position in Northern Dynasty. Kerrisdale profits as shares of Northern Dynasty fall.
Analysts on our team were on Kerrisdale’s conference call and read their report.
Kerrisdale says Northern Dynasty’s Pebble mining project in Alaska is worth nothing… zero. Yet, it offered no new technical or scientific evidence. On the call, they labeled themselves as market generalists with no background in the mining industry. They made vague references to engineers, but would not disclose their names or credentials.
One of their main arguments is that mining giant Anglo American and other large miners walked away from the project because Northern Dynasty’s resource is worth nothing. We disagree.
Anglo, a major London-based miner, didn’t pour more than $500 million dollars into a project that it thought was worthless. On the contrary, a half-billion-dollar-plus investment requires dozens of qualified experts with estimates of massive potential. The large investment demonstrates the potential Anglo saw in Northern Dynasty.
Kerrisdale claims Anglo walked away because they thought the mine was worthless. But they offer no evidence or contact at Anglo for this position. The fact is, only Anglo’s management knows why they pulled out of Pebble…
We suspect Anglo’s tenuous financial position at the time, coupled with a declining gold price and low prospects of regulatory approval under the previous government administration were taken into consideration in their decision process. As far as we know, neither Anglo nor any other major mining company has ever stated that Pebble has no potential… as Kerrisdale is claiming.
As we stated when we recommended Northern Dynasty, Pebble is the largest undeveloped gold-and-copper resource in the world. Kerrisdale agrees with us here… They acknowledge the resource is there. They simply claim it will never be economically or technologically feasible to take the resources out of the ground… And provide no evidence for their claim.
The problem is simple…
We know the resource is there. Northern Dynasty has drilled 1,350 holes proving as much. Now it’s a function of the value of the resource (based on quantity, grade, and extraction costs) that makes it economic to develop. Obviously, higher gold and copper prices make the economics more favorable.
There is no doubt that Pebble will require billions of dollars to develop. But with 70 million ounces of gold, 344 million ounces of silver, and 57 billion pounds of copper measured and indicated in the ground, those capital requirements don’t seem so daunting… A $100-per-ounce increase in the price of gold alone raises the projects value by $7 billion… completely changing the picture of high development costs.
And while Pebble is a massive low-grade deposit, it’s possible to mine it with cheaper “open pit” techniques…
Kerrisdale claims that the technology to conduct environmentally safe operations at Pebble does not exist. They gloss over the fact that similar massive mining operations are being carried out around the globe daily. And they disregard a plan that Northern Dynasty spent $150 million developing with the help of over 500 scientists and technicians to make mining possible… and without damaging the Bristol Bay.
Finally, Kerrisdale disregards what a Trump Environmental Protection Agency (EPA) might say on Pebble. Let us say this… having the president and EPA opposed to granting a permit is not conducive to investment. The fact is, the previous administration placed roadblocks on Pebble. We expect that will change under the Trump Administration.
Kerrisdale argues many politicians and environmentalists worried about Bristol Bay are still opposed and the permitting process will take years to complete. On this, we agree.
But we never invested in Northern Dynasty based on the company actually developing an operating mine…
We recommended Northern Dynasty as a speculation that the regulatory roadblocks would go away, so that a mine is at least feasible. And we recommended Northern Dynasty because of its massive resource, giving us tremendous leverage on a rising gold price. When gold prices go up, the value of the metals in the ground also goes up, whether they are being mined or not.
When pressed on the call, Kerrisdale stated they really have no hard facts… just opinion. They’re entitled to that… But keep in mind that they are biased. By holding a short position on the stock, they make money as Northern Dynasty’s stock falls. Kerrisdale’s timing on the release of the report is suspicious – coming days after the stock reached a 52-week high.
.
As one gentleman on the conference call stated, he will be using this opportunity to buy more shares. We suggest you do the same.
Action to take: Buy shares of Northern Dynasty Minerals (NYSE: NAK) up to $2.50 per share if you don’t already have a position.
February 14, 2017
P.S. The hedge fund manager in this case is notorious on Wall Street for bad calls and bad judgement. He’s been famously wrong about a major bet to short shares of DISH Network, and last summer he was arrested for DUI and cocaine possession after a serious car wreck that injured another driver.
His method of doing business – to short a stock and then use social media to bash the business – is, at best, questionable. We have nothing against short sellers. In fact, we recommend shorting stocks frequently when we have serious doubts about their balance sheets, their businesses models, or their accounting practices. We express our doubts objectively (not after we’ve made a big investment) with careful research and facts – not hyperbole and conjecture.
We think investors should be very skeptical of investment research that’s published by any entity whose business depends on promoting a position (long or short) after establishing one – whether it’s a hedge fund manager with a history of drug abuse or an established industry titan. The fact is that having a bunch of money on the line (like Bill Ackman with Herbalife) tends to warp investors’ judgement.
Fascinating. They shorted the stock, then bashed it and caused what i think was a 36% down movement in the stock price [at its peak]. Same company did the exact same thing with AG not too long ago. I don’t know if it is legal, but it sure worked. They pick on companies that are highly speculative and over-promoted by people who hypnotize them with dreams of 10 baggers, then they short the company and crush the dream. Kind of like a bash and crash version of pump and dump.
Hedy – I am a bit confused – (not an unusual condition for me). Who exactly wrote the report you quoted, and made the recommendation that one buy NAK shares at up to $2.50 ??
This report came from one of my other PM newsletters.
They had recommended the stock at 0.76.
Long – Mariana Resources (OTC. MRLDF)
Published on Feb 2, 2017
From the 2017 Vancouver Round Up: Joe Mazumdar discusses with Eric Ross what the latest plans are for Hot Maden gold and copper project also elsewhere in Turkey, Mariana holds a 100% interest in the Ergama gold-copper project.
Mariana Resources is just too good to sell: mining analyst Joe Mazumdar
https://youtu.be/0kUNu6KZEzE
$MRLDF…I agree 1000% with Mazumdar and I have a large position.
And I think it is a good time to add to the position, under $1.00.
For my friends and followers out there, let me give you another great reason
to get into this stock:
Sandstorm Gold has a major EQUITY position, in addition to their royalty deal.
So, why do you think Sandstorm Gold, a ROYALTY company that dislikes operational risk, has taken a voluntary EQUITY position ?
Sandstorm Gold has lots of geologists and financial guys to do due diligence. Their due diligence and analysis will far surpass anything we can do.
Go to the Sandstorm site and look at their forecasted cash flow from Hot Maden.
The mine is going to be a bonanza. Sandstorm has taken a major exception to invest directly in this company and has a board seat, their CFO Ron Ho sits on the Mariana board.
Sandstorm does make money selling newsletters or shorting stocks. They make money by identifying deposits with potential and investing in it.
Long Sandstorm. Long Mariana Resources.
Long $SAND, long $MRLDF.
HN: It looks like you dropped a “not,” in that the 4th line from the bottom of your comment above should read as follows: “Sandstorm does NOT make money selling newsletters or shorting stocks.” [emphasis added]
Right you are, thanks.
Long Nighthawk Gold (OTC. MIMZF)
HN here is another Northwest Territories Company to put on your radar and might like to look into. It has a market cap. of 78M. They are working on past producing ground and early drill results are showing high grade hits. It is one of the top picks in Brent Cooks and Joe Mazumdars portfolio for possible buyout by a major
Why Nighthawk Gold is one of Canada’s most promising gold projects: Joe Mazumdar
https://youtu.be/-C-d4lrjTlo
SA article about Tesla ($TSLA) European Gigafactory: It points towards Finland having a heads up since large deposits of lithium are found there. My guess is that Finland could have a leg up as Norwegians are avid Tesla drivers. Unforurtnaly, the Keliber Oy mine is private.
Tesla SA article: https://tinyurl.com/zemfabt
Keliber Oy: http://keliber.fi/company
I wish I could’ve played that one somehow…
If you believe in the electric battery vehicle future, take a look at CleanTeQ.
$LGCUF – Does anyone know why Luna Gold has a ‘Halt” on trading?
jokin
JDL Gold Corp.
Suite 1400 – 400 Burrard St
Vancouver, BC V6C 3A6
Tel: +1 604-628-1164
http://www.jdlgold.com | info@jdlgold.com
Luna Gold Corp.
Suite 730 – 800 West Pender St
Vancouver, BC V6C 2V6
Tel: +1 604-558-0560
http://www.lunagold.com | ir@lunagold.com
NEWS RELEASE
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.
JDL Gold and Luna Gold Announce a Bought Deal Private Placement for C$15 Million
and an Increase to the Non-Brokered Private Placement to C$50 Million
February 14, 2017 – Vancouver, BC – JDL Gold Corp. (TSX-V: JDL) (“JDL”) and Luna Gold Corp. (TSX: LGC) (“Luna Gold”) are pleased to announce that in connection with the business combination and private placement financing announced on February 1, 2017, JDL has entered into an agreement with Haywood Securities Inc. and National Bank Financial Inc. (together, the “Co-Lead Underwriters”), on behalf of a syndicate of underwriters (collectively with the Co-Lead Underwriters, the “Underwriters”), for a bought deal private placement of subscription receipts for gross proceeds of C$15 million. The Company has also granted the Underwriters an option, exercisable in whole or in part up to 48 hours prior to the closing of the offering, to purchase up to an additional 2,500,000 subscription receipts for additional gross proceeds of up to C$5 million.
In addition, due to substantial demand, the previously announced non-brokered private placement of subscription receipts has been increased to up to C$50 million.
JDL will issue subscription receipts (the “Subscription Receipts”) at a price of C$2.00 per Subscription Receipt. Each Subscription Receipt will entitle the holder to receive automatically upon closing of the Transaction (as defined below), without any further action on the part of the holder and without payment of additional consideration, one Unit, comprising one JDL common share (a “Common Share”) and one JDL listed common share purchase warrant (a “Warrant”). Each Warrant will entitle the holder to acquire one Common Share at an exercise price of C$3.00 with an expiry date of October 6, 2021. The Common Shares and Warrants issued upon conversion of the Subscription Receipts may be traded by the holders through the facilities of the TSX Venture Exchange (“TSX-V”) and will not be subject to a statutory hold period. A commission of 5% will be paid to the Underwriters in connection with the bought deal private placement.
Closing of the financing is subject to customary conditions, including the approval of the TSX-V. Following completion of the business combination and the financing, proceeds will be used to repay debt, for the exploration and development of the Aurizona gold project and for general corporate and working capital purposes.
JDL and Luna Gold have entered into an arrangement agreement (the “Agreement”) to combine their businesses (the “Transaction”), creating a multi-asset mining company. Under the terms of the Agreement, JDL will acquire all of the outstanding shares of Luna Gold in exchange for 1.105 JDL common shares.
The combined company intends to change its name to Trek Mining Inc. and expects to trade on the TSX-V under the ticker symbol “TREK”. Trek will be well-funded with no cash debt and will be strongly positioned to advance its Aurizona gold project to production. The increased financing will also allow Trek to plan a larger exploration program at Aurizona, with a focus on drill-ready targets directly along strike from the existing reserves and resources at the Piaba open pit.
– 2 –
Closing of the Transaction is subject to customary conditions including court and regulatory approvals and the approval of the securityholders of both JDL and Luna Gold. A joint information circular detailing the terms and conditions of the Transaction will be filed with regulatory authorities and mailed to the securityholders of Luna Gold and shareholders of JDL in accordance with applicable securities laws. The special meetings of both companies are expected to be held in the second half of March 2017, with completion of the Transaction anticipated by the end of March 2017.
The Subscription Receipts will be offered by way of a private placement in all of the provinces of Canada and may be offered in the United States on a private placement basis pursuant to exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the “U.S. Securities Act”).
The securities offered have not been, and will not be, registered under the U.S. Securities Act or any U.S. state securities laws, and may not be offered or sold in the United States or to, or for the account or benefit of, United States persons absent registration or any applicable exemption from the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. This press release does not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor in any other jurisdiction.
About JDL Gold Corp.
JDL Gold is a financially strong emerging gold-copper production and development company focused on building shareholder value through the acquisition and development of precious metal and copper assets. JDL controls a diverse portfolio of assets in Peru, Ecuador, Chile and Canada. Further information is available at http://www.jdlgold.com or by email at info@jdlgold.com.
About Luna Gold Corp.
Luna Gold is engaged in the exploration and development of its past producing Aurizona Gold Mine in Brazil, which was placed on care and maintenance in 2015. A pre-feasibility study for the project completed in September 2016 outlined the design of an open-pit mine producing on average 150,000 ounces of gold annually for the first five years (see the “Pre-feasibility Study on Aurizona Mine Project, Maranhão, Brazil, NI 43-101 Technical Report” completed by Lycopodium Minerals Canada Ltd.). A feasibility study for the Aurizona project is underway, with the objective of pouring gold at the Aurizona Gold Mine in late 2018. Further information is available at http://www.lunagold.com or by email at ir@lunagold.com.
Bullish for Sandstorm. They get a cut off the top and the Luna/Aurizona project was a problem for them.
I have posted their news release. Pending moderation.
Bought deal, private placement of $15 million bringing their total to $50 million.