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Gold stocks tend to under-perform during election years. Over the past quarter-century up until the prior election, the performance of the Philadelphia Stock Exchange Gold and Silver Index (XAU) was weak during the year of a presidential election. The silver lining for gold stock investors is that the XAU has historically bounced back the year after the election as shown in the chart below.


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Based on this observation I screened for gold mining companies with insider buying during the last 30 days. Here is a look at four companies that I found.

1. Osisko Mining Corporation (OTCPK:OSKFF) operates the Canadian Malartic gold mine in Malartic, Quebec and is pursuing exploration on a number of properties, including the Hammond Reef Gold Project in Northern Ontario.


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Insider buys

  • John Burzynski purchased 30,000 shares on December 3 and 20,000 shares on November 16. Mr. Burzynski was the Chief Geological Consultant and Vice-President Exploration for Osisko from June 2003 to March 2006 and has been Vice-President of Corporate Development of Osisko since March 2006.
  • Marcel Côté purchased 10,000 shares on December 4 and 10,000 shares on November 21. Marcel Côté serves as a director of the company.
  • Michèle Darling purchased 10,000 shares on June 5. Michèle Darling serves as a director of the company.

Financials

The company reported the third-quarter financial results on November 13 with the following highlights:

Revenue $158.5 million
Net income $26.2 million
Cash $114.9 million
Debt $327.9 million
Gold production 0.1 million ounces

Outlook

Gold production at the Malartic gold mine continues to increase quarter-over-quarter with improvements in the milling plant. The table below outlines the steady progress towards achieving design mill throughput rates, rising availability and subsequent increase of gold production.

Tonnes per
Operating Day

Availability
(%)

Gold Production
(oz)

Q3 2012

43,181

94

103,753

Q2 2012

38,074

90

92,003

Q1 2012

35,728

87

91,178

Q4 2011

33,733

90

79,718

Q3 2011

36,742

86

73,814

Q2 2011

29,894

82

46,606

Sean Roosen, President and Chief Executive Officer of Osisko, commented the third quarter results:

"We continue to focus on ramping up our operations at Canadian Malartic to the 55,000 tonnes per day name plate capacity. We are making very good progress and are increasing our gold output and improving our profit margins. Our cash unit cost decreased by 15% during the period and we continue to benefit from robust gold market".

News

On November 12, 2012, Osisko announced that it had entered into a definitive agreement to acquire, on a friendly basis, all of the issued and outstanding common shares of Queenston Mining (OTC:QNMNF) on the basis of 0.611 of an Osisko common share for each common share of Queenston. Queenston is a Canadian mineral exploration and development company with a primary focus on its holdings in the historic Kirkland Lake gold camp comprising 230km2 of exploration lands.

My analysis

The stock is currently down 24.7% for the year. The stock has a $18 price target from the Point and Figure chart. There have been six insider buy transactions and there have not been any insider sell transactions since September 26. The stock is trading at a P/E ratio of 26.75. The company has been increasing its gold production for six consecutive quarters. I have a cautiously bullish bias for the stock currently based on the technical and fundamental picture.

2. Rio Alto Mining (RIOAF.PK) is a Canadian based resource company focused on the development of the 21,000 ha La Arena gold/copper project, located in north central Peru, the most prolific gold mining district in the country.

La Arena contains 3.9 million ounces gold and 2.0 billion pounds copper in measured & indicated resources with additional inferred resources of 2.2 million ounces gold and 2.1 billion pounds copper. First gold production at La Arena occurred on May 6th, 2011 and 161,064 ounces of gold were poured during the first three quarters of 2012.


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Insider buys

Financials

The company reported the third-quarter financial results on November 14 with the following highlights:

Revenue $60.9 million
Net income $10.8 million
Cash $67.2 million
Gold production 44,652 ounces

Outlook

Mining at La Arena is advancing according to the 2012 mine plan and the company re-affirmed its previously announced 2012 gold production guidance of 190,000 to 210,000 ounces at an average cash cost per ounce of gold sold within a range of $500 to $550.

Due to higher than expected gold grades, lower ore tonnes mined and better than expected recoveries management team, in conjunction with a number of independent experts, is undertaking a detailed review of the mine's geological, mining, metallurgical and reconciliation models to better predict the mine plan for 2013 and for the updated resource and reserve estimate scheduled for release in Q1 2013.

The current schedule is to release the 2013 mine plan including production and cost guidance in January 2013 with the updated resource and reserve scheduled for release later during Q1 2013.

My analysis

The stock is currently up 59.2% for the year. The stock has a $7.31 price target from the Point and Figure chart. There have been two insider buy transactions and there have not been any insider sell transactions since November 1. The stock is trading at a P/E ratio of 12.95. The 200 day moving average is currently at $4.68 which could be a good entry point for the stock.

3. Thompson Creek Metals Company (NYSE:TC) is a growing, diversified North American mining company. Thompson Creek has two large operating molybdenum mines, a large copper-gold mine under construction, a stand-alone metals roasting facility, and a number of additional metals properties in various stages of development. All operations are located in the United States or Canada.


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Insider buys

  • Kevin Loughrey purchased 20,000 shares on November 29, 25,000 shares on May 23 and 15,000 shares on February 29. Kevin Loughrey currently holds 181,861 shares of the company. Mr. Loughrey is the Chairman of Board of Directors and has been Chief Executive Officer of the company since December 1, 2006.
  • Mark Wilson purchased 3,200 shares on November 28, 2,000 shares on May 14 and 1,000 shares on February 29. Mark Wilson currently controls 31,386 shares of the company. Mark Wilson is Executive Vice President and Chief Commercial Officer.
  • Denis Arsenault purchased 53,000 shares on May 16 and currently holds 145,336 shares of the company. Denis Arsenault serves as a director of the company.

Financials

The company reported the third-quarter financial results on November 9 with the following highlights:

Revenue $74.9 million
Net loss $48.2 million
Cash $359.7 million
Debt $578.8 million

Thompson Creek announced on November 28 the closing of its previously announced offering of $350,000,000 aggregate principal amount of its 9.75% Senior Secured First Priority Notes due 2017.

Outlook

The company anticipates that the completion and start up of Mt. Milligan will take place in the third quarter of 2013, with commercial production of copper and gold occurring in the fourth quarter of 2013. Average annual production will be higher during the first full six years of production (approximately 89 million pounds of copper and 262,000 ounces of gold), compared to annual life-of-mine production. The company will provide formal production and cash cost guidance for 2014 once Mt. Milligan is operational.

Overall project completion is estimated to be at 75%. The company currently estimates an aggregate of approximately $1.5 billion to construct and develop Mt. Milligan, of which approximately $515 to $585 million of cash expenditures remain to be spent as of September 30, 2012.

My analysis

The stock is currently down 57.0% for the year. There have been 12 insider buy transactions and there have not been any insider sell transactions this year. The stock is trading at a forward P/E ratio of 8.25. The company has a book value of $11.29 per share. I have currently a long position in the stock.

4. Pershing Gold Corporation (OTCQB:PGLC) is a new gold exploration and development company focusing on acquiring, exploring, and developing gold deposits in Pershing County and elsewhere in Nevada. The Relief Canyon Mine property in Pershing County is owned by Gold Acquisition Corp., the company's wholly owned subsidiary.


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Insider buys

  • Barry Honig purchased 3,409,091 shares on December 3 in a private placement. Barry Honig currently controls 25,176,541 shares of the company and serves as a director of the company. Barry Honig also controls 12,194,236 shares of Continental Resources Group (OTC:CRGC). Continental Resources Group and Pershing Gold have entered into an asset purchase agreement. After this agreement is executed, Barry Honig will control 9,755,389 additional shares of Pershing Gold.
  • David Rector purchased 18,000 shares on September 11 and currently holds 2,018,000 shares of the company. David Rector serves as a director of the company.
  • Phillip Frost purchased 1,562,500 shares on June 20 in a private placement. Phillip Frost is a 19.28% owner of the company.
  • Coeur d'Alene Mines (NYSE:CDE) purchased 10,937,500 shares on June 20. The shares were purchased in a private placement.

Financials

The company reported the third-quarter financial results on November 14 with the following highlights:

Revenue $0
Net loss $5.1 million
Cash $1.5 million

On December 3, 2012, Pershing Gold completed a private placement to several accredited investors for 9,469,548 shares of its common stock and 3,787,819 warrants for aggregate gross proceeds of $3,125,000.

Outlook

The company's 2012 exploration program is nearly complete. The company spent $4.8 million on exploration activities during the nine months ended September 30, 2012, and anticipates spending approximately $0.4 million for the remainder of 2012.

The company's estimated total cost for 2013 for exploration, permitting, landholding, re-commissioning facilities, and general and administrative expenses is approximately $13 million.

Upcoming milestones

  • New NI 43-101 compliant Technical Report of the Relief Canyon Mine project will be released in the fourth quarter of 2012.
  • Gold production in the Relief Canyon Mine will begin in 2014.

My analysis

The stock is currently down 32.0% for the year. There have been 10 insider buy transactions and there have not been any insider sell transactions during the last 6 months. The company is expecting to increase its indicated and inferred resources to 600,000 - 750,000 ounces with the new NI 43-101 compliant Technical Report due later this year. The initial target gold production will be 50,000 ounces per year starting in 2014. The Relief Canyon Mine is a past producing mine that already has a ready-to-operate heap leach facility along with most of the permits to begin production again in place.

Source: 4 Gold Miners With Recent Insider Buying