3 Mining Companies With Insider Buys During Last 45 Days

Includes: AGI, GLD, HMNC
by: Markus Aarnio

When insiders buy shares on the open market, their companies are usually undervalued. Corporate insiders often have the inside track on their companies' prospects. Insiders probably wouldn't risk investing too much of their own money into their own companies unless they thought the stock might rise.

I screened for companies where at least one insider made an insider buy during June - July period. Here are three mining and exploration stocks that I found:

1. Alamos (AGIGF.PK) is an established Canadian-based gold producer that owns and operates the Mulatos Mine in Mexico, and has exploration and development activities in Mexico and Turkey. The company employs more than 500 people globally.

Insider buys

Sharon Fleming purchased 5,300 shares on July 12th. Sharon Fleming serves as a senior officer of the company.


The company reported first quarter earnings on May 1st with following highlights:

Earnings per share $0.24
Shares outstanding 120.4 million
Cash $212 million

My analysis

The stock has a $8.5 price target from the Point&Figure chart. If we do reach that target, I would consider it as a buying opportunity.

2. Energizer Resources (OTCQB:ENZR) is an exploration stage company engaged in the search for vanadium, graphite, uranium, gold and other minerals. The company has an interest in properties located in the African country of Madagascar and Canada (Province of Québec). The company's shares also trade at Toronto Stock Exchange (TSX: EGZ).

Insider buys

Richard Schler purchased 60,000 shares on June 15th, and currently holds indirectly 3,660,000 shares of the company. Richard Schler, MBA, has been the company's Vice President, Chief Financial Officer and a director since April 2006.


The company reported first quarter results on May 15th with the following highlights:

Cash $4.7 million
Net loss $0.02 per share
Shares outstanding 154 million

Upcoming milestones

According to Dundee Securities research report published on March 22, 2012:

Ambitious 2012 Plans - Management expects to spend up to approx. $4MM on exploration drilling and metallurgy, resulting in an initial resource and PEA in the latter part of this year. This should position the company to start a bankable feasibility study [BFS] in early 2013. Management has also started discussions with appropriate authorities regarding exploitation permitting.

My analysis

The stock is currently up more than 50% for the year. The stock trades currently at significant discount to its resource base of upward 100 million tons of graphite ore.

3. Hondo Minerals Corporation (OTCPK:HMNC) is engaged in the acquisition of mines, mining claims and mining real estate in the United States, Canada and Mexico, with mineral reserves of precious metals or non-ferrous metals. Hondo owns the Tennessee and Schuylkill Mines in Chloride, Arizona. The Tennessee Mine was the largest producing silver mine in Arizona history. The Tennessee Mine operated from the late 1800s until 1947, producing lead, zinc, gold and silver. The company also owns numerous other mining claims in the U.S. Southwest, which are being evaluated for additional reserves.

Insider buys

Stephen Grosberg purchased 80,000 shares during June 18th - July 17th and currently holds 10,842,001 shares of the company. The company has 67.3 million shares outstanding, which makes Stephen Grosberg a 16% owner of the company.


The company reported first quarter results on June 15th with the following highlights:

Cash $0.8 million
Net loss $0.01 per share
Shares outstanding 67.3 million


On June 27, 2012 the company announced an updated report as it commences commercial scale production at its Old Tennessee Mine in Chloride, Arizona. The company has completed initial construction of its first commercial scale extraction plant that will be used to process the estimated one million tons of tailings and dumps at the mine site. The company intends to extract gold, silver, zinc, lead, and other metals that it believes to be present from the pile.

My analysis

It is possible that the stock has found a bottom with the recent news and insider buying. I might take a small position in the company.


I believe that gold is still in a secular bull market. Gold Trust (NYSEARCA:GLD) has a $224 price target from the Point&Figure chart.

Disclosure: I am long (GLD). I am long (OTCQB:ENZR)