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James Emerson

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  • Tanzanian Royalty Exploration Is An Excellent Short Candidate [View article]
    Gamestop dropped from $21 in August 2011 to $15 in August 2012 returning over 25% to the short seller.
    TRX is trading close to multi-year lows, returning close to 40% in slightly over a month since my comments.

    Short selling is not a buy an hold game. There is absolutely no reason to give back profits once the trend changes or new information becomes available.
    Oct 17 05:25 PM | Likes Like |Link to Comment
  • Tanzanian Royalty Exploration Is An Excellent Short Candidate [View article]
    $2.64 Q.E.D.
    Sep 26 03:21 PM | Likes Like |Link to Comment
  • Tanzanian Royalty Exploration Is An Excellent Short Candidate [View article]
    As the winner of a competitive auction, TRX paid $3 million for their interest in Buckreef. TRX has spent some money drilling and may have expanded and or upgraded the resource base; however, ascribing a valuation of a $100 million is just ridiculous. Valuation is an art. In the case there is an actual transaction, an investor should rely on the price from that rather than a contrived hypothetical value.
    Sep 13 10:40 AM | 1 Like Like |Link to Comment
  • Tanzanian Royalty Exploration Is An Excellent Short Candidate [View article]
    There are no royalty partners left. They have all relinquished their license areas. There is zero possibility of another firm developing a TRX controlled property and paying royalties. The last royalty candidate was the Chinese nickel producer, Jicuan and that company just walked away.
    Sep 11 07:05 PM | 1 Like Like |Link to Comment
  • Tanzanian Royalty Exploration Is An Excellent Short Candidate [View article]
    The agreement with STAMICO states that TRX must fund 100% of the Capex required to bring the mine into production. TRX then gets to recover the Capex before STAMICO receives its portion.
    Bottom line is TRX needs to come up with $230 million.
    Sep 11 03:48 PM | 1 Like Like |Link to Comment
  • Tanzanian Royalty Exploration Is An Excellent Short Candidate [View article]
    When TRX is removed from the NYSE ARCA Gold Miners Index, at the close of business on Sept 20, the Van Eck ETF tracking that index, GDX, will almost certainly sell all 7.26 million shares that it holds.

    Note that from a trading perspective the self proclaimed legendary trader James Sinclair has only made three open market buys (I don't count one transaction where he sold a greater number of shares the next day) in the last three years, all in November and December of 2011 right after I published this article on SeekingAlpha http://seekingalpha.co... . Compare that to the over 50 open market sells in the same time period.
    Sep 10 02:09 PM | Likes Like |Link to Comment
  • Tanzanian Royalty Exploration Is An Excellent Short Candidate [View article]
    You are incorrect about the amount of capital that the company must raise to fund Buckreef. Pursuant to its agreement with STAMICO, TRX must pay 100% of the cost to bring the mine to production. The total Capex required for the project as specified in the PEA is a minimum of $230 million see page 86 of the PEA filed June 20th 2012. That particular scenario has an NPV of only $45.8 million at a 10% discount rate. That would put the NPV of TRX's share at $25 million.

    The valuation is generous given that the government of Tanzania just sold bonds at an average yield of 15.75%. After considering the potential cost of debt financing or the dilution from an equity raise, the economic value to TRX shareholders is close to nil.

    The company has probably around $10 million in cash left. That gives it about 5 quarters at the current burn rate. This stock is a great short and will likely trade in below $0.50 in the medium term and approach zero in the long term.
    Sep 10 01:48 PM | 2 Likes Like |Link to Comment
  • Tanzanian Royalty Exploration: The Next Tanzanian Gold Producer [View article]
    TRX had less than $11 million of net cash as of May 31. I believe that the company is insufficiently capitalized to produce enough gold at Kigosi to fund the $100+ million of capex required for the Buckreef project.
    Sep 5 02:37 PM | Likes Like |Link to Comment
  • Tanzanian Royalty Exploration: The Next Tanzanian Gold Producer [View article]
    That is the SEDI description for RSU grants. You can refer to the company filings to see these are in fact annual grants. It is very telling that the executives and directors frequently sell their common stock as soon as it becomes unrestricted.
    Sep 4 12:41 PM | Likes Like |Link to Comment
  • Tanzanian Royalty Exploration: The Next Tanzanian Gold Producer [View article]
    He didn't purchase them. They are part of his compensation.
    Sep 4 11:31 AM | 1 Like Like |Link to Comment
  • Tanzanian Royalty Exploration: The Next Tanzanian Gold Producer [View article]
    For the #1 contributor on insider ownership, this is some very sloppy work. Since March, not one insider has made an open market purchase of stock. Almost all the "buying" reported is actually grants of restricted stock units or the transfer of restricted stock units to common stock.

    Since March 2013:
    Helen Hansen, corporate secretary, sold 25,453 shares, about 1/3 of her holdings
    S. Von Tongeren, the CFO, sold 15,000 shares, and
    President Joseph Kahama sold 8,286 shares.

    Insider selling clearly dominates. Chairman James Sinclair hasn't bought a share despite the stock trading near multi year lows back in June. Insider activity is clearly sending a signal and it is not a bullish one.

    For a refresher see my article from 2011, still true today. http://seekingalpha.co...
    Sep 4 09:50 AM | 1 Like Like |Link to Comment
  • InterOil And Pacific LNG Group Enter Into Exclusive Negotiations With ExxonMobil On Development Of The Elk And Antelope Resource [View article]
    Not really good news. Seems XOM wants to recertify the resource. That doesn't instill a lot of confidence. Also moves out the timing for any potential monetization. Also no bid was forthcoming just areas of discussion. I guess the other two super majors didn't bid.
    May 24 11:46 AM | Likes Like |Link to Comment
  • The sudden retirement of InterOil (IOC) CEO Phil Mulacek should speed the securing of a major JV partner for its Gulf LNG project in Papua New Guinea, Raymond James analyst Pavel Molchanov says. Mulacek was a "sharply polarizing figure" perceived as "an obstacle" to a deal with interested partners such as XOM, RDS.A or TOT, and his departure provides a catalyst for an announcement. [View news story]
    I have a different read. His resignation provides him cover to liquidate his position. Since he will no longer be an insider he no longer has to report his transactions.

    I also find it odd that he is leaving before a deal is signed. I would have expected him to resign upon announcement of a deal if he were the impediment.
    Apr 24 12:00 PM | 1 Like Like |Link to Comment
  • New Evidence Questions Whether InterOil Actually Received A Bid From A Supermajor For Its Asset Selldown [View article]
    Don't ever make the mistake of thinking that some company is smart just because they invested $20 million. Plenty of so called smart investors including the CFAs who worked their owned Bear Stearns, Lehman Brothers, Fannie Mae, Enron, Sino Forest. I could keep going If you follow the herd blindly you can get led to the slaughter house. A billion dollar fund can lose 100% on a 1% position and it is nothing more than a hiccup. For every successful short trade there are somewhere around 8 geniuses on the long side who lost their shirt.
    Apr 11 06:45 PM | Likes Like |Link to Comment
  • New Evidence Questions Whether InterOil Actually Received A Bid From A Supermajor For Its Asset Selldown [View article]
    It is actually the company which is playing semantic games. It would be very easy for the investor relations department to clarify, but IOC is silent for some reason.
    Apr 11 06:24 PM | Likes Like |Link to Comment
COMMENTS STATS
240 Comments
241 Likes