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  • Golden Reign Resources: An Undervalued Compounding Machine [View article]
    I agree this is very decent project on paper but my major issue here is this project optimally should be built at around 800-1000tpd if you believe in the reserve numbers. From experience that fact has me skittish in believing the mine either does not contain the stated reserves or a management scheme to string it out in order to enrich themselves.
    Jun 30, 2015. 02:05 PM | Likes Like |Link to Comment
  • Zinc And Lead Can't Rally, Best They Can Hope For Is Range-Bound [View article]
    I used to own TV through Kria Resources but sold it around 2.30 a few years ago just before they started to raise capital which I knew was going to be an ugly process for the stock. The big appeal to TV is the total lack of inventory of pure play zinc producers (I know of only 3) but I think TV is the highest valued zinc producer of the 3 even with the Caribou contribution when you look at all of the their accounting metrics. Thanks to its reliance on raising capital it has been well promoted by investment banks and therefore priced relatively high on a comp basis.


    A company like this MUST beat all in costs for an investor to theoretically net a return in the long run.

    I would rather find something at a healthy discount to book with operations showing signs of improvement to give you another moat for risk protection.


    I would prefer TCK for consideration as their Red Dog operation is the highest quality zinc mine in the world but the met coal and energy implosion certainly has been the recent driver of the stock so its going to be a timing event of stabilization in those sector niche(s) with that firm before I would commit dollars but the company is not a pure play in zinc.


    Jun 11, 2015. 01:40 PM | Likes Like |Link to Comment
  • Silvercrest Mines: I Don't See Much Value [View article]
    I beg to differ I was rewarded very well with this stock. My purchase in 2009 yielded me a 400% return in late 2012 a full year after the decline of the PM market where this stock still remained relatively resilient for a approximately a year before it succumbed to the pressures of the sector and the stock also had another great timing rally of close to 100% in 2013-2014. If you are going to be a buy and hold forever investor in any cyclical sector you are going to be burned.

    Admittedly, I timed my entry and exit very well here but market conditions allowed me to.

    I still have to agree with you the market appears to be focused on the decline of the future mine quality here since the open pit has been fully mined out and is fairly valued on a book value or discounted NPV basis compared to its peer group with continued skepticism in the sector especially for a firm operating in its declining stages.

    Is it fair perhaps not but a sector not in an obvious bull market can become very fickle.

    What is working in this challenging environment is consistent production growth that can produce above all in costs.
    May 28, 2015. 11:03 AM | Likes Like |Link to Comment
  • Silvercrest Mines: I Don't See Much Value [View article]
    I appreciate a published article seconding my opinion exposing the investment flaw(s) in SVLC which has been a very well run company to date and one of few mining companies until recently for the most part able to maintain a premium in book value which is a big credit to their management.

    I agree this firm is at a point where it could benefit with the right acquisition.
    May 27, 2015. 11:36 AM | 1 Like Like |Link to Comment
  • SilverCrest Mines - This Beaten-Down Stock Holds Promise [View article]
    The open pit was the bread and butter high quality part of this operation and that phase is on its final legs.

    I think this is a sell into strength on the production windfall from both sources of OP and UG ore. I agree the costs should fall once stopes are developed given the costs associated with the UG development has hurt AISCs the past few quarters which is a temporary catalyst but that figure will creep back up again a year from now once their open pit ore is fully processed.

    Looking forward I really think the UG portion of this mine is of only average quality and many average operations trade at a discount to book value.
    May 9, 2015. 01:04 PM | Likes Like |Link to Comment
  • Why Is It The Right Time To Buy Nevsun Resources [View article]
    For the record I took some money off of the table.

    Nothing new here it is a high quality operation and it is cheaply valued on an EV basis but the copper grades will continue to decline throughout the year and the big dragging issue is the company already hit its peak in earnings during the gold phase and I have calculated it will take zinc to surpass 1.50/lb and processing their highest zinc grades just to match 2014's earnings.

    Unfortunately, in this challenging environment for the sector it also takes production/profit growth for a miner to really outperform and sustain momentum.

    Part of the reason why the value suffers here because its cash on the balance sheet makes no return and the firm has yet to make an acquisition to grow the company and derisk its sole concentration of cash flow because of its obtuse "parameters" for an acquisition. (NSU is not the best value out there in the space).

    I think from a timing perspective you are going to get a better opportunity again because copper grades in the supergene ore will continue to fall as time progresses until they commission the zinc plant.

    I think 2016 will likely be a good year for Nevsun however, just on the premise of a continued rise in zinc prices and the inventory of shares of pure play zinc producers are very limited in supply but earnings will likely not exceed 25 cents in 2016.
    May 7, 2015. 06:41 PM | Likes Like |Link to Comment
  • MGP Ingredients Could Keep Going [View article]
    I also found it quite odd there hasn't been an article here until now.

    Been long here since the 2013 harvest. MGPI has enjoyed a great crush spread since the 2013 harvest and fuel ethanol had been the major driver in 2014 which you did not mention in the article they own an equity interest in a fuel grade ethanol plant in IL but the distillery provides a stable sales base that has also benefited from the crush spread hence the reason of the continued resiliency of the stock price compared to other users of corn to produce ethanol.

    Much like Steve I have been a seller here for the same reasons. Higher tax rate and more risk of margin declines.
    May 7, 2015. 05:45 PM | 1 Like Like |Link to Comment
  • The Oil And Solar Divergence Does Not Make Sense [View article]
    My observation is stock prices are blatantly politically manipulated in all directions many sectors impacted and it is much more obvious during this bull market. In the case for oil supply fundamentals were ignored for years until Putin became rogue. Gold prices were manipulated lower because it undermined the dollar. Coal as a fuel is anti EPA and as a result the industry is becoming obsolete. For profit education has been questioned on the viability of the effectiveness of student loan repayment and that sector has been decimated. OTOH companies that are pro government in aiding of their spying like FB near record highs.
    Apr 16, 2015. 01:16 PM | Likes Like |Link to Comment
  • John B. Sanfilippo: Severely Mispriced With Significant Near-Term Upside [View article]
    I still remain cautious because on a historical basis the stock price is well beyond all time highs on a price/sales ratio. If you look at the data typically the valuation would peak at .3 times sales in this commoditized business. So I think the sector is in a major bubble. On a comp basis this stock is cheap but herd investing is not my style.

    Obviously, these high valuations are due to the nirvana conditions in the food processing industry in general with low borrowing costs and the business has been able to maintain historically high margins from low commodity prices, shrinking their product sizes and very high selling prices using regional drought and shortages as an excuse for it even though it is very easy to procure commodities at low prices .
    Mar 30, 2015. 12:43 PM | Likes Like |Link to Comment
  • Afren Plc.: ~$112mm Of Equity Value About To Be Wiped Out [View article]
    I agree the stock is nearly worthless to current equity holders.

    They certainly did a super job covering up the fraud ongoing at this company with the non performing asset in Kurdistan where they actually paid a 30 million dollar donation/bribe just to get the concession and then hid the problem for quite some time. Past management bails out by creating a diversion of receiving payments and then the new management does really nothing by playing totally ignorant and in effect pardoned them when they paid back the slush money but the company never disclosed the scam of the nonperforming asset for years.

    I still don't know how they could burn through that much cash in just one quarter without any attempt to salvage the company at an earlier date and I am also still quite puzzled their hedge was also worth approximately 350 million was never monetized. It could at worst bought it could have bought them time to raise equity at a relatively decent price.
    Mar 6, 2015. 11:50 PM | Likes Like |Link to Comment
  • Renewable Energy EPS of $1.61 [View news story]
    Funny how numbers can be spinned. I highly doubt the consensus estimate included the value of the tax credit of $1/gallon. Value of the blenders credit is 95 million or 2.25/share. So the Q4 operating loss technically was approx 63 cents.

    Guidance for Q1 2015 is a 10-30 million dollar loss. .23-.69 loss range. So the company can tolerate 56 cent quarterly losses to break even assuming same rate of production.

    This really a quirky company to figure out from an investment end because operations are showing losses and then back ended to the blenders credit and the reason why this trades at such a discount to book value but I can see the appeal on any improvement on industry fundamentals if the BTC is expected.
    Mar 3, 2015. 07:27 PM | 2 Likes Like |Link to Comment
  • Update: Nevsun Doubles The Size Of Its Indicated Resources, Inferred Resources Grow 18-Fold [View article]
    I am curious why you like GORO other than the ability to potentially receive your dividend in Au or Ag coins. The stock is not cheap and P/P reserves are like a year and a half. Even though they have potentially extended mine life with new drilling results AISCs are likely to substantially rise to get access to the new stopes provided it is economic to do so.

    With regard to NSU yes its peak earning years from Bisha are past them but it is likely going to perfectly time the zinc cycle.

    If you look at NSU on an EV basis however its future earnings remain heavily discounted with 14 years of open pittable mine life remaining excluding any potential from an underground operation which should start to become be delineated in 2015.

    I see you like GTE for its balance sheet strength think of NSU is the GTE of mining but even better yet pays you a return (dividend) to hold shares.
    Feb 20, 2015. 12:09 AM | Likes Like |Link to Comment
  • Agnico Eagle Outperforms Gold Peers, Expects To Produce 12% More Gold In 2015 [View article]
    Assuming you are going to strictly stick with acceptable jurisdictions to AEM and gold only. Aura and Claude look ridiculously/comparati... cheap to me and both have turned around/restructured operations.

    Aura is expected to show a large impairment charge in Q1 but even with the charge the remaining book value is still going to be 50 cents a share. Its EV/EBITDA for 2015 at 1200 gold is less than 1 even with its carried debt load and the firm will be LT debt free in 2016.

    Claude should show net earnings of 10 cents a share US implying a 3 PE. Claude has outperformed AEM in 2014 since its recovery has been much more obvious and well under way for a few quarters.
    Feb 19, 2015. 11:43 AM | Likes Like |Link to Comment
  • Agnico Eagle Outperforms Gold Peers, Expects To Produce 12% More Gold In 2015 [View article]
    I have never understood why this firm has not been aggressively acquisitive of smaller profitable one mine operations that show a consistent similar aisc cash cost profile using their stock as the medium of acquisition. No other gold miner receives such a rich premium .
    Feb 18, 2015. 06:59 PM | Likes Like |Link to Comment
  • Oil supply will outpace demand for years, BP predicts [View news story]
    I agree this oversupply argument is stupid. Markets have always been in oversupply. Saudi Arabia always had trouble marketing heavier crudes and Cushing has been awash in oil which explains the 10-15% discount of gasoline prices in the midcontinent region.

    Prices have been rigged to stay artificially high for quite some time ignoring supply/ demand fundamentals to spur development of higher cost energies be it conventional or green .

    Oil prices in this instance were deliberately dropped for political reasons (to punish Putin's economy) that happened to become exacerbated by the convenience of this condition by Saudi Arabia's refusal to cut production to potentially curb additional development of marginally economic crude supply.

    Since it appears Putin is behaving for now I think prices will continue to slowly recover barring an economic depression lurking on the horizon.
    Feb 18, 2015. 10:42 AM | 1 Like Like |Link to Comment
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