I told you yesterday that we’d be looking for the balance of the stocks teased by Sean Brodrick after identifying the “Goldstone Strike” picked that he touted (that was Randgold Resources, you can see yesterday’s article and commentary on that one here if you missed it).
So that’s just what we’re doing — there are five stocks to uncover and discuss, so we’ll make it quick and let you get right to your cogitating:
“Gold Pick #2: The Sole Heir to the Largest Gold Fortune in the United States
“In the coming year, the sole heir to the United States’ largest gold strike will tap an estimated $4 billion worth of gold.
“Best of all, you can get a stake in this gold for an unheard of $39 per ounce….
“It’s already used this methodology to grow its resources from 1 million ounces in May 2010 to over 3.2 million ounces today… making it possible for you to pay just $39 per ounce for your portion of its reserves….
“This similar setup will allow the company to make a fortune.
“And so could its investors – like renowned hedge fund manager Ken Griffin, who bought close to $17 million worth of this company’s stock.
“Recently, I stopped by the company’s headquarters and spoke to the CEO.
“In our talks, he revealed the company is scheduled to receive a mining permit that will ‘double its production’ and ‘cut costs in half.’
“As for the potential upside, he said, ‘We’ve just scratched the surface on this project.’
“… you can still get on board for under $2 a share.”
This one, it appears, is most likely to be the company that has consolidated much of the old landholdings of the original Comstock Lode — Comstock Mining (LODE). This was one of the huge mines in US history, producing millions of ounces of silver and gold and creating a bustling den of sin in Virginia City, Nevada decades before Bugsy Siegel and Meyer Lansky set their eyes on Las Vegas.
And no, I can’t be 100% certain because I don’t think Ken Griffin’s Citadel hedge fund owns shares of Comstock Mining — though it had a roughly $17 million position in Comstock Resources (CRK) last year. That’s a much larger oil and gas company in Texas and Louisiana, as far as I know the firms are not in any way connected … but it’s easy for a copywriter to screw that kind of thing up.
LODE is a junior miner, producing gold and silver now and aiming to double production this year and increase it considerably more in future years, we’re told. I don’t know much about them, but Sean Brodrick did publicly mention his visit to the company and his fondness for their prospects in this article last fall. I think the permit they were talking about was a water permit, which they did get, and they seem to be a decent, small miner from my quick glance. I’ll leave you to the research on that one, and we’ll move on.
“Gold Pick #3: Bag 277% From This Tiny Canadian Miner With Over $4 Billion in Silver
“Major news is starting to buzz around one mining community…
“Located about 46 miles from Durango, on a paved highway, lies this huge mining discovery in Mexico’s modern “Wild West.”
“The site is easily accessible by federal highways or by charter aircraft – which can land at a small paved airstrip on the outskirts of town a few miles away.
“For years, local farmers have plowed this agriculturally rich area of Mexico… completely unaware of the fact that they stood on BILLIONS of dollars of precious metal….
“… this small exploration company hit the precious metals jackpot…
“Having staked exclusive rights to 1,307 acres, it has quietly uncovered what could be the largest untapped silver and gold discovery of the last two centuries…
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just click here...“It’s a massive deposit with an estimated 198.6 million ounces of silver, currently valued at an impressive $3.9 BILLION.
“That’s almost 20 times this company’s $200 million market cap… shares just over $1 right now….”
That one’s Silvercrest Mines (SVLC, SVL in Toronto) — the deposit referenced is their La Joya project near Durango, Mexico, you can see the details of that one here. This is another producing and cash-flowing junior, though it’s a little bit bigger with a market cap of about $250 million — the only reason I’ve heard of this one is their partnership with Sandstorm Gold for a gold stream on their smaller producing project, Santa Elena. La Joya could be a dramatically larger mine if and when it’s actually built, in part because of its massive copper resource in addition to potentially 198.6 million ounces of silver if the grade cutoff is fairly low, but for now they’re doing well and producing profitably from Santa Elena (Sandstorm Gold just invested another $10 million in expanding the underground mine there).
Another one?
“Gold Pick #4: The World’s Most Powerful Silver Royalty Company Is Holding a Discount Sale… Here’s How You Can Grab Your Share…
“This fast-growing silver royalty company has an innate ability to spot value… amassing a fortune in the commodity.
“This company receives millions of ounces of silver at a rock-bottom cost of only $4 an ounce – 80% cheaper than what everyone else pays for silver.”
I’ll stop you right there … this is obviously Silver Wheaton (SLW), the large silver streaming company that’s also the biggest precious metals royalty/streaming company on the market. And one of the stocks we’ve probably mentioned more than any other here at Stock Gumshoe, because I like royalty/streaming companies (they finance mines and get a royalty or a chunk of production in return) … and because they get teased quite often.
SLW is quite diversified across mines, partly thanks to the fact that they were able to build up a large portfolio of silver streams at a time when silver interest was low (silver is often a byproduct of copper, zinc, nickel, lead or gold mines — miners sold the silver in advance to SLW because silver wasn’t their primary product or focus), but it’s a bit tougher for them to grow meaningfully with new deals now because of their massive size — so they’re getting more levered to recent, large deals, which might be a problem if silver collapses again. But still, this is a very large royalty/streaming company with a focus on silver, and it’s by far the cheapest royalty/streaming company based on pretty much any metric I can think of — that’s partly because people don’t trust silver quite as much as they trust gold, given silver’s much higher volatility in recent years. I’d buy Silver Wheaton before I bought a stand-alone silver miner, and it should have meaningful leverage to the price of silver, but I don’t own either at the moment (I do own some physical silver, and try to buy small chunks of it on a semi-regular basis).
More? Tired yet? Don’t worry, we’re almost done …
“Gold Pick #5: This Company Pinpoints Gold Deposits With Laser-Like Accuracy… And It’s Poised to Quadruple Its Production…
“Okay, I’ve talked about some bargains so far. But this high-grade gold producer trades below book value – a trait nearly unheard of in this industry.
“And no, the mine isn’t underwater or on the slopes of an active volcano.
“It’s just undiscovered… though probably not for long.
“Recently, this firm’s high-tech surveillance and scouting equipment pinpointed a strip of land in Mexico that contains gold in about the purest form you can find.
“It’s poised to yield up to 2.3 million gold-equivalent ounces. And make no mistake, this gold windfall would be a profit-making bonanza for this small company.
“Last year alone it increased its reserves by 171%!”
This one, it appears, is Primero Mining (PPP in NY, P in Toronto), a larger but still small gold miner (market cap about $800 million) that has been acquiring smallish high-grade mines or projects. The latest acquisition to close is their purchase of Brigus Gold, which finalized today and gave them the Black Fox and Grey Fox projects in Timmins, Ontario, but the one being pitched here is the Cerro del Gallo project in Mexico that they agreed to buy a little over a year ago — that project does indeed have 2.3 million ounces of gold equivalent resources plus reserves (“gold equivalent” just means that it’s not all gold — they’re including the substantial silver or other mineral reserves and translating them into how much gold they would be worth). They also have a producing mine, San Dimas, that’s producing now, and they’re expected to be profitable next year.
This is one of the few small or mid-size miners that’s actually at or near its 52-week high, it appears that investors really like their strategy of rolling up relatively small, high-grade mines that have further exploration potential, and they now have a decent pipeline of projects to keep reserves and production growing … as long, of course, as gold prices cooperate.
Oh, and yes, they do have experienced management — CEO Joseph Conway helped build IAMGold into a $6 billion company, and has been at the helm of Primero for about four years now.
One more?
“Gold Pick #6: The Tiny Firm Making a Killing on Gold… Without Mining an Ounce
“One small firm has discovered a low risk ‘backdoor’ entrance to the gold market that entails huge profit potential…
“Even though its mining interests are primarily in gold… It gets no revenue from mining operations.
“In fact, this tiny firm is making a killing on gold… without mining an ounce.
“It buys property… finds a partner to explore and develop the projects… and collects an interest in whatever it finds.”
That sounds like it’s one of the gold royalty companies, which is a pretty small fraternity to begin with — but which one?
“And it increased its dividend a total of 153% over the last five years.
“And here’s the best part…
“As the stock price of this firm’s partner appreciates in the coming months – which we expect will happen as gold prices rise – this firm’s stock price could easily double in the next few weeks.”
That makes it a bit more odd, because Franco-Nevada doesn’t really have just one “partner” … though they do have royalties on mines from most of the biggies, like their former corporate parent Newmont Mining and giants Goldcorp and Barrick Gold. But since they are that specific about the dividend that narrows it down from two dividend-paying gold royalty companies with long histories to, well, one: Franco-Nevada (FNV in both NY and Toronto).
This is a solid pick among the royalty companies, but really, if you like gold they’re probably all solid picks at this point (Royal Gold, RGLD, and Sandstorm Gold, SAND, are the two other publicly traded gold royalty/streaming companies of any size, and SAND is far smaller than the two big guys. I own SAND personally). Franco-Nevada, like Royal Gold and Silver Wheaton, has done bigger deals as it has gotten larger, so it is somewhat levered up to higher prices because of its major commitment to huge projects like the Cobre Panama mine that now has been delayed and won’t be online for almost four years, but it’s also quite diversified … and I do like their smallish chunk of platinum group metals royalties thrown in for a bonus, and their small energy position too, which provides a bit more diversification.
And that’s all I’ve got in me today — what do you think? Any favorites you’d like to trumpet in this group of five “explosive” stocks teased by Sean Brodrick? Several of these are pretty well covered in the investment newsletter world, where the pundits tend to follow each other around a lot, so I’m sure many of you know at least a few of these stocks well … and probably own some of them… so let us know what you’re thinking with a comment below.
P.S. If you’re interested in what our mining columnist thinks, he’s been busy at PDAC this week and we’re finishing up his column for publication soon, but in the past Myron mentioned LODE as a “buy on dips” idea last Summer, and he’s also had nice things to say about both Brigus and its new owner, Primero.
Another mining stock with huge potential is WGPLF
If so I haven’t seen it yet. So far I’ve lost 16%.
You must have bought close to 1.00. Some Seeking Alpha article, I think, gave it a price target of 6.40.
Reminder to all, with so many companies out there and the similarity of stock symbols, I would personally appreciate the actual company NAME being mentioned as I may not recognize a stock symbol, particularly the over the counter market which are usually 4 digits.
It takes extra time to look up what company is being talked about. Much more likely to recognize a company name as opposed to an OTC stock symbol. I try to avoid buying OTC anyway because of lack of liquidity and sometimes a higher bid and ask spread of low volume stocks.
Great article Travis! Any one have any thoughts on copper and NCQ (Novacopper) in particular?
Copper prices may well stabilize as long as China dosen’t blow up their financial system and I plan on writing at least two columns on copper, (domestic and foreign) in the near future.
Mawson resources mwsnf otc and maw toronto has a huge and rich resource under evaluation in europe
pe 547. nogo
Have held Mawson for years and taken profits several time. I still have faith in long term viability of their project so I am holding even though price has been down of late.
Anyone like ANV? I was watching it for a while, but never bought. Chart looks similar to SLW except hasn’t broken out as much it seems. I’m not very familiar with analyzing mining companies… Looks like a decent value though
They are running out of oxide ore, so they will have to start mining sulfides.
forgot to click the notify box
Explosive = risky. It’s a minefield out there.
Individual investors need to minimize risk, because of an epidemic of predators in the stockmarket. I echo G.Shoe’s perspective that royalty companies are much risky than miners and may be worth investing in.
Royalty much LESS risky than miners I meant.
Hey, Travis: thanks much for showing all the Canadian stock symbols in addition to the American ones. Much appreciated up here across the border.
Dozens of junior mining companies have all gone up high double digit and even triple digit percentages since gold bottomed this autumn. But all will decline proportionally again if gold
starts to dip again. My favorite individual stocks are ATC, BAR, KOR, KAM, PZG, FVI and SVL (mentioned in the story above). However, if gold and all the junior miners continue to do well, the ETF, JNUG offers 3X leverage on junior gold miners.
Junior uranium stocks such as FVI, URL, URZ, NXE and MKN with probably do even better in the short run than gold and gold stocks.
Travis I always enjoy the thrill of you and the thinkolater observations , as I get to sit here and listen to Obama’s Budget news and the Presidents vision being told by his budget Director Sylvia and have to wonder why she does not say that China owns our Gold Vault in New York City right next to the US Treasury. Political safe mines comes to mind. They the teasers all have a 49.95 $ news letter and I am glad I have you and the irregulars. I have several gold stocks and some physical gold, and wonder when the money printing machine make fire wood and the miners shine, I think the streamers are good and mines that are close to producing at a decent cost and the ones that already are. I kept my Sand after I got on there dime so if it goes to 0 I break even , but there is still sunshine there I think, but the NG, PPP, which just took my BRD , GG, ANV, SLW, will all come with time , but I just think it is super important to watch what country these mines are in, but I still think there will be some sleepers cheap and that is where the Gumshoe COMES IN, just imagining how many shares people could buy with your subscription, especially if you pull a couple penny stocks out of your hat and let us know if , I can say thanks to you and the irregulars and a little due diligence, but my deal is I take my profits out and keep what I can on there dime. Some times I take profits a little early but it is still better than a minus, SO if I buy 1000 shares right and I always use limit orders , sell 500 getting back my initial cost or most of it, I get to keep what is paid for or close and than sell puts , so far I only had to buy one back but with in a week it went up and I sold it a winner and that was ANV couple months ago, good management and politically safe area’s along with the printing machine printing madness Gold will be back guess that will be the Gold and well Silver rush, thanks, I still like your bank warrants ,so please let us know when you smell something , I know it is our choice but your knowledge is really cool on that, Thanks for opening my eyes there cause the financial sector will always be there. There will always be Gold rushes, Thanks.
I’ve had some bad luck with Brodrick and his oil picks. Now I tend to do nothing he suggests or go just the opposite way.
Travis, your service and the way you present your articles are priceless. Don’t ever stop ! Will check out Brodericks gold picks, but think your approach, ( Royalty Cos, i.e. RGLD and SAND ) is very sound. Any info though on GLDI and SLVO for those of us who are hungry for obscene dividend income ??? Thanks again, very much. Dave
as a matter of record, I tip my shoes to you, O Great Gumshoe.
Being very old, the first foreign stocks I looked at were back in the 1960s when the dollar price of gold first was liberated by R. Milhouse Nixon (before he was liberated from the White Mil House by being impeached). That was decades before I started http://www.Global-Investing.com when I worked at the Senate Foreign Relations Committee and invested for myself alone.
Because we worked on Latin America, Canada, and Europe, I thought I should make most of my investments in Canada, where there was no conflict of interest with my job. Of course with the gold price going for $35 to over $800 you can guess what tempted me.
Oh if there had only been a gumshoe then, how rich I would be today! Not only was there no Travis. There was no Internet. You paid through the nose for the advice and the commissions.
Pretty soon I learned that in Vancouver either the mines were under water or the stocks were. You had to rely on a broker who barely knew more than you did and who wanted you to trade for his commissions. And you got broker and broker.
is anybody know about San Gold (SGR)
They have a small, high-grade mine that is losing money.
Echo that, unless the gold price explodes higher a lot faster than I expect there are far better companies out there such as Primero who just completed takeover of Brigus, both of which I own and intended to profile in greater depth, but the merger/takeover was a pleasant surprise that should enhance the value of both companies.
Travis, thanks for your research efforts. Worth their weight in Gold. 🙂
Regarding the miners I think the arrow still points DOWN. It is still early days before the explosion that WILL happen ultimately. Do not fight the FED!
ANV is running thin. I spoke to miner in nevada bar and it is loaded down with debt and they did come into a nice .pull that should boost revenue just be careful with the valuation once they report.
What do you know about Corpus Gold (corvf)? I bought about two years ago and currently am about 95% ahead. They keep drilling and finding more veins. I am really behind this junior.
Curious what your opinion is.
Biggest problem with ANV is low grade, but they have still been profitable and I am up since buying recently. If the bears are right that gold will drop into the $800 to $1000. range then I will be selling as they are not likely to remain profitable. Given the state of the world economy and in particular the continued printing of currency by the four major Central Banks I have a hard time envisioning such a scenario. I would give a rise to at least $1550. for the year a 75% chance compared to 25% for a below $1000. The bullion banks at the behest of the government have been manipulating the price of precious metals to try and save their Ponzi scheme fractional reserve banking system that is collapsing, and with gold already down to basic production costs I do not see gold falling much except for a very brief dip that should be BOUGHT! No way I am selling so these white collar criminals can add to their stash cheaply by scaring people into selling, they know what is coming and are positioning themselves to profit in both directions by deceiving the public of their intents.
MUX-McEwen Mining is an EXTREMELY SOLID P.M.-Miner, and it has tremendous DNA as it’s CEO is the former founder of the venerated and often cited as ‘Best Overall Gold-Miner” Goldcorp (GG). He only takes a $1/year as salary and I’m a buyer and believer of (MUX). Myron Martin is a Strong believer, as well!
I believe there’s more $ in %/terms to be made in Silver, with (SLW), (TAHO), (AG), (PAAS), (SSRI), (EXK), (SVLC), (FSM), (SVM) and the penny stock (EXXLF) are all Phenomenal Winners in order of Significance.
SLVC-NOT SVLC-SilverCrest Mining
I read your message and decided to FU on a couple of items… I don’t believe your symbol for the penny stock is correct as there is no stock for the symbol EXXLF.. is that a typo?
yeah, so, it’s called Excellon Resources and ticker is EXLLF. Also LOVE BCEKF, MISVF, SVBRF, HCHD, AUMN and GARWF in AG space…
Anyone like MUX?
Profiled it several months ago, Rob McEwen certainly has a much healthier attitude towards shareholders than management of some of the majors like Barrick who are now in big trouble due to their profligate ways, Rob puts shareholders first by taking only $1. per year in salary and has $25 M. of his own money in the company.
Men from Cornwall, England travelled the world opening mines. There is a Cornish saying about the difference between a Brothel and a Goldmine.
“A brothel has an ‘ore at the top and a Liar at the bottom, whereas a goldmine has um t’other way round.”
Sean Broderick goes to visit his sites – but always seems to take what the liar at the top says as gospel. He always touts it as something he is the first to discover, therefore once Joe Public catches on it will rocket. It never seems to occur to him that the reason the shares are down is because other potential investors have already heard the liar’s spiel – and don’t believe it.
What’s the difference between a government and a gold mine?
The government has all the ‘ores and liars at the top, and no gold at the bottom.
I am curious about Corvus Gold. I found it about 2 years ago. Has recently found lots of gold in Nevada. Any and all thoughts on this one would be appreciated.
Corvus Gold is on my profile list, definitely a “steady eddy” worth following