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Long a buy and hold investor, I now believe that buy and hold has to be re-evaluated in a world of ever increasing, instant information and huge gyrations in markets all over the world. A value investor at heart, I anchor my portfolio with conservative funds and blue chip dividend stocks, but... More
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  • Brigus Gold Is Extremely Under Valued 9 comments
    Feb 9, 2012 10:48 PM | about stocks: PPP, GLD

    Brigus Gold - 2012 should make investors very happy

    Brigus Gold Corp (TSX - BRD) (AMEX - BRD)

    is a mid-tier gold producer operating in several jurisdiction including it's producing Black Fox Mine complex near the prolific gold region of Timmons, Ontario, Canada.

    Unusual for such a company is that it's head office is in Halifax, Nova Scotia. Brigus has a very solid management team with many years of experience amoug them in in the field of gold mining. They are fucused on building shareholder value through the further development of the Black Fox mine and their Goldfields property near Uranium City Saskatchewan.

    Brigus expects to produce 100,000 oz in 2012 and is planning to double production in the next few years to 200,000 oz. Proven and probable reserves now total over 2,000,000 oz and with new discoveries, this number will grow.

    Current Market cap is 200m with 196m shares outstanding and the shares traded today at a low of $1.02 per share. Cost of production will average $700 per oz in 2012. Having regard to all of the numbers given by Brigus Gold in their January investor presentation, their resource base is only being valued by investors at $117 per oz. That, my friends, is such an extreme under-valuation of those resources that it borders on the ridiculus.

    Brigus has recently made agreements to option off it's mine holdings in Mexico so as to free up cash (currently $19.1M) for development of it's core assets at Black Fox and Goldfields. Current debt is $50M

    The price of gold has spiked in recent months and a number of expert analysts expect the price to go as high as $2200 this year. Over the past year, the share price of gold miners has not kept pace with the price of bullion. In fact, it has declined during that time. History tells us that this divergence between bullion prices and gold miners will correct itself and when it does, it will happen very quickly. Mid-tier miners such as Brigus and Sangold will lead this charge, in my humble opinion.

    Large gold producers, with their eye on the bottom line, often increase their resource and production base by buying mid-tier miners such as Brigus Gold and San Gold (another one of our favourites) At these very low valuations, this makes Brigus a diamond in the rough so to speak.

    Larger institutional investors include: Sprott Asset Management, LLP; Van Eck Associates Corporation; Wellington Management Company, LP; Baker Steel Capital Managers, LLP; Oppenheimer Funds, LLC; Hale Capital Partners; RBC Precious Metals; BlackRock Financial Management; Earth Resources; and Waterton Resources

    Recently Sprott upped their position by 5M shares to 20M shares or approx 10% of the company.

    The Motley Fool has made Brigus one of their top three picks this year and give it 4 stars.

    Over the past week we have doubled down on our holdings of Brigus Gold. We expect to be well rewarded during 2012. They say patience is a virtue. If you are currently holding Brigus Gold shares, good for you. If you are not, maybe you should be.

    Happy investing.


    Related articles

    Disclosure: I am long BRD.

    Stocks: PPP, GLD
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Comments (9)
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  • TruffelPig
    , contributor
    Comments (4208) | Send Message
    Agree, way undervalued. I doubled up to.
    10 Feb 2012, 07:07 PM Reply Like
  • TruffelPig
    , contributor
    Comments (4208) | Send Message
    This dilution I did not plan on......grrrrr. Sell shares for 95 cents - doesn't look like the company is confident. This is not exactly share holder friendly. Boooooooooooo, I don't buy a single share more.
    23 Feb 2012, 08:16 PM Reply Like
  • Retirefund
    , contributor
    Comments (770) | Send Message
    Author’s reply » The bought deal was a surprise I agree.....especially at the price of .95c....not something any shareholder normally likes.....however, at $15m it is a small amount in comparison to overall market cap and operations will benefit from the may also be a small gift to institutional shareholders who bought in at a higher multiple, for their patience.....When I doubled down it was at .99c....I think this puts in a bottom on the stock....only time will tell......staying long BRD
    24 Feb 2012, 10:14 AM Reply Like
  • TruffelPig
    , contributor
    Comments (4208) | Send Message
    I calmed down, will buy more and hope......
    24 Feb 2012, 10:41 AM Reply Like
  • TruffelPig
    , contributor
    Comments (4208) | Send Message
    Interesting article by a Motley Fool guy:
    24 Feb 2012, 10:53 AM Reply Like
  • Retirefund
    , contributor
    Comments (770) | Send Message
    Author’s reply » Thanks for the link Trufflepig. Looks like our Foolish friend agrees with my assessment and then some......I believe he is right....time will tell.....I still say, the bottom is in in BRD shares!
    27 Feb 2012, 03:35 PM Reply Like
  • TruffelPig
    , contributor
    Comments (4208) | Send Message
    Looks like it from today's price action in Gold miners.
    27 Feb 2012, 07:28 PM Reply Like
  • Docsteed
    , contributor
    Comment (1) | Send Message
    I notice this hasn't been commented on in some time, but this company caught my eye and I was wondering if anyone still has an opinion on it. It appears that Brigus has met all of its production goals and yet the price has gone down steadily. Is this company just undervalued or am I missing something here?
    1 Aug 2012, 01:57 PM Reply Like
  • cobourg
    , contributor
    Comments (3) | Send Message
    Retirefund - are you considering writing an update on Brigus?


    The following might be of interest --> as you know Brigus has been exploring two zones (147 and Contact) that will make up the new Grey Fox Mine zone.


    An updated N43-101 is due in Sept & a PEA by YE even though infrastructure construction of the mine has already started with production forecast for 2014.


    Over the past two weeks Brigus has released two batches of drill results for these zones -- you might find them interesting:


    On August 23/12 - BRD announced drill results from the CONTACT zone. On Tuesday BRD announced drill results from the 147 zone.


    It is the combination of these two zones that make up the new GREY FOX MINE. This is a summary of the assays.


    56M @ 7.65 g/t --> incl 28M @13.08 g/t


    16.95M @ 12.95 g/t


    9.5M @ 7.49 g/t


    32M @ 5.1 g/t --> inc 10M @ 15.43 g/t


    12.4M @ 4.54 g/t


    12.5M @ 3.34 g/t


    37.5M @ 2.25 g/t --> incl 3.08M @ 8.75 g/t


    7.5M @ 8.86 g/t


    10M @ 8.95 g/t --> incl 3M @ 27.04 g/t & 13M @ 5.14 g/t


    19.7M @ 1.29 g/t --> incl 23M @ 3.15 g/t


    34M @ 2.01 g/t


    16M @ 2.46 g/t


    11M @ 3.12 g/t


    3M @ 11.45 g/t


    7.4M @ 6.4 g/t


    3M @ 10.16 g/t


    33M @ 3.94 g/t --> incl 11.7M @ 6.98 g/t


    17M @ 5.89 g/t


    4.2M @ 4.8 g/t as well as in the same drill hole 16.2M @ 3.8 g/t


    12.35M @ 2.32 g/t as well as in the same drill hole 6.8M @ 7.21 g/t


    10M @ 5.91 g/t as well as in the same drill hole 52.3M @ 2.51 g/t incl 16.7M @ 5.03 g/t


    10M @ 14.52 g/t as well as in the same drill hole 18M @ 2.64 g/t


    2.6M @ 42.78 g/t


    These are exceptionally good results which (imo) border on bonanza grade and they are ALL part of the GREY FOX mine complex.


    I have no doubt that when the updated N43-101 for GF is released this month (09/12) that it could reveal an absolutely stunning increase in gold reserves/resources!!!


    I don't believe BRIGUS is widely known in the US but someone has been buying heavily on the AMEX...........



    Hope you find this information useful and look forward to your next article!
    5 Sep 2012, 09:46 PM Reply Like
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