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  • Nevsun Resources - High Long-Term Potential With Limited Downside [View article]
    My only beef with your article is the expectation for Cu and Zn prices will have to be awfully high on the order slightly north of 3.20/1.60 respectively for the company have a shot at a 50 cent per annum earnings clip based upon Bisha production alone.

    At the current 2.10/.70 pricing the firm likely will be near break even. Given the Cu eq ore grade will only average around a 3.5% grade.
    Nov 17, 2015. 01:20 PM | Likes Like |Link to Comment
  • Resource Sector Digest: Utter Failure [View article]
    Mark Twain once said, "A mine is a hole in the ground with a liar standing beside it".

    I see the major problem with the mining sector is it does the absolute worst job at allocating capital and timing for equity raising of funds (always when under financial duress) and under deflationary pricing conditions is tough to find the very few firms that can show any growth. And during this cycle were foolish enough to mostly eliminate the use of hedging when they were in the process of building lower quality assets.

    BTW I would like to see the data set of the life cycle of a junior miner and how current is that chart. I would argue the real peak in the cycle for a majority of junior firms really lies after the initial find in the exploration stage.
    Nov 10, 2015. 03:05 PM | 1 Like Like |Link to Comment
  • Nevsun Resources misses by $0.01, misses on revenue [View news story]
    My issue is the analysts generously lowered expectations on last quarter's bad miss and they still had a shortfall.

    No question on paper the mine quality, balance sheet and dividend yield is superb when looking at comps but ever since the Ethiopian bombing issues have started to show up for the worse and hence not "discussable" according to them .

    Last year Frazier cited the high ore grades was the reason for the lower recoveries and now they are at the level where improvement was to be seen and they continue to get worse.
    Oct 30, 2015. 12:55 PM | Likes Like |Link to Comment
  • Low P/E Stock Of The Day No. 39: MGP Ingredients Inc. [View article]
    I agree with the author. I made 300% profit on the upside cycle here and currently on the sidelines.

    The issue here is the firm never has done a good job hedging costs in the past and the firm is in an operating nirvana for 2/3rds of its businesses as selling prices are flat to up in a lower cost environment.

    I am actually now considering timing to shorting this and currently taking a wait and see approach on the effect El Nino has on precipitation in the midwest
    Oct 30, 2015. 11:28 AM | Likes Like |Link to Comment
  • Nevsun Resources misses by $0.01, misses on revenue [View news story]
    I saw the results as a disappointment again especially considering the grade of ore processed!!

    Personally, I think management has gotten away with way too much leniency by investors and with these latest results Frazier has been caught in a lie from a past excuse in a prior conference call with regard to recoveries.

    Why are the recoveries so low and still continue to trend even lower and why is there a consistent 10-15% penalty in the price received for copper. This issue never gets any discussion during the conference calls.

    At this rate the cutoff for the supergene ore should now be raised to 3% and the rest stockpiled.
    Oct 30, 2015. 10:15 AM | Likes Like |Link to Comment
  • Cracks Spreads Lower, Sell The Pure Play Refiners [View article]
    Your article is too simplistic assuming every refiner is forced to process premium feedstock. It totally fails to address the crack spreads on heavier crudes still remain very attractive.

    I think the article should have focused upon the vulnerability of firms whose assets are more tied to the brent/WTIspread like DK NTI etc..

    HFC and VLO has plenty of heavy crude ready assets. I actually think the larger risk in VLO is related to the shift in weather pattern impacting ethanol margins for next harvest season.
    Oct 23, 2015. 10:39 AM | 4 Likes Like |Link to Comment
  • Playing The Deficit In The Zinc Market For Expected Higher Prices [View article]
    On the supply side zinc is looking up. Glencore last Friday shut in of 500 KT of annual production at its zinc mines hence the recent large rally in the price of zinc. Marginal producer Trevali was up over 50% in one day.
    Oct 12, 2015. 09:59 AM | Likes Like |Link to Comment
  • Playing The Deficit In The Zinc Market For Expected Higher Prices [View article]
    Even in light of an 8 year bear market zinc has been a tough road especially given the lack of visibility from an inventory point of view as Glencore recently has been able to scrape up a 9 month supply off of the books and dump it on the open market hence the rise in stockpiles and as a result weakness in price.

    Barring any other surprises from additional off of the book inventories I think the future window for zinc will be positive at least until production from the Kipushi mine commences. It is still unclear at what ultimate rate the ore will be produced at that mine but that mine should surpass Red Dog as the world's largest producer.
    Oct 8, 2015. 11:48 AM | Likes Like |Link to Comment
  • Endeavor Mining: The Ity Gold Mine Acquisition Will Drive Upside [View article]
    I think Sawiris got the much better part of this deal because he gets a much longer extension on an option for the price of gold. It really was the end of the line for La Mancha.

    For 30% of the company EDVMF got 63 million, a mine with only a 2 year life and a project for 3 producers with a 10 year plus mine life 1 with a 3-4 year life and a project..

    In order to get the other 2 projects into production it will take around 300% of the current market cap to get both of them going. That is not attainable without more dilution. The company's growth will take more equity thus is not self sustaining and I define these kind of companies as a management empire.

    The only way you make money here is another bull market in gold.
    Oct 5, 2015. 09:26 AM | Likes Like |Link to Comment
  • Trevali Mining Has Been Pummeled - We Are Buying The Dip [View article]
    Part of the issue for the recent freefall here has been related to the recoveries well below design plan at the Caribou mine. If Trevali can resolve that issue without any further dilution I agree it should see a nice upside over time.
    Oct 4, 2015. 12:54 AM | 1 Like Like |Link to Comment
  • Volkswagen AG: Expect A Dividend Cut, Dilution, And Lower Profits Going Forward [View article]
    The can of worms that I find challenging to determine from a legal liability perspective is the from the rest of the world since I do not know their specific lemon laws but I suspect it would have a lower impact under laxer emission standards.

    In addition, I think they are very vulnerable to a potential shareholder's suit for fraud.

    In the US I think to quantify the most likely scenario in a settlement will be equivalent to what is covered under the California's lemon law. (Retail price of the car plus attorney's fees). I highly doubt a litigant will collect treble damages.

    Potential liability in the US related to this would be 15 billion plus the EPA fine.
    Sep 29, 2015. 08:08 AM | Likes Like |Link to Comment
  • Nevsun's Drill Results Continue To Impress [View article]
    C1 costs are projected to rise as the trend of Cu ore grades continue to fall as the ore depletes. I am surmising the firm will transition to zinc at a 2% Cu cutoff and stockpile the lower grade supergene ore when it becomes economic.
    Sep 24, 2015. 12:57 PM | Likes Like |Link to Comment
  • Nevsun Further Improves Harena's Attractiveness With A 250m Extension [View article]
    A good find for potential future development but it will require higher cost underground mining methods my estimate between $30-35/ton vs $3/ton in the open pit. The ore grade is on the low side around a 7% Zn eq grade for such development. I am expecting all in costs of somewhere between .90-1.00/lb for this specific ore and as an investor expect a conservative view on a capital spend to develop it as I don't want at all to see this development partially cannibalize the rest of the operation.

    One thing for sure this dumping of zinc by Glencore onto the market sure leaves a bitter taste in my mouth for the lack of transparency of the data and the serious oversupply/overcapacity the sector currently has implying most mining commodities turning around for supply reasons at this time is just not going to happen anytime soon and shows how bad especially the copper market looks going forward given the amount of that metal being pledged as loan collateral.

    While NSU has some minor issues they pale in comparison to the majority of the firms in the mining sector and is the best value in a very tough market.

    Sep 24, 2015. 10:15 AM | Likes Like |Link to Comment
  • Manning & Napier Inc. - Good Value Hiding In Plain Sight [View article]
    Finally a perceived safe quality potential value buy outside the realm of commodity stocks in the midst of a persistent crisis of fund outflows at the company. For one at this level I think this stock starts to make sense to own from a potential offer from an insider if you assume the interest on the debt would generate enough savings vs its dividend obligation and the difference to its current premium to enterprise value. At this price an insider could technically pocket all of the cash and own its real estate assets for nothing irregardless of market value from operating earnings if financed 100% at 5% or less interest rate.

    In addition, I believe this company would make a good income vehicle AARP for a patient investor with a very high yield in excess of 8% given its starting to close in on a zero enterprise value and has a strong debt free balance sheet to easily weather a bearish market cycle.

    Given the trend in the stock continues to fall when should you logically begin to scale on a value basis?

    In my critical analysis my buying point it will take a valuation at or below a zero enterprise value for me to become interested here assuming patience to hold it for the next bullish market cycle.

    The company is currently imploding because of the large reduction in assets managed which is how they generate the majority of their revenue from a combination of poor performance compared to and investment outflows.

    I will admit the company's mix of products are pathetically dated, somewhat limited and should contain a more diversified mix (like at least one or two product(s) that favor(s) bear markets and something smaller cap for bull markets) in order to justify an investor to want to keep assets within the company. To add the corporate structure is very top heavy which is a plaguing problem of most financial firms.

    If a firm offers SPY type portfolios and can't beat the SPY or a major index of its niche products to me it starts to have a credibility issue of accepting fees.

    Another major problem and the biggest one of all which will always have its presence there is absolutely no way to institute change at the company as an investor given the structure of its voting rights on its common which is why this stock continually remains undervalued on a peer basis so that sort of approach to analysis is moot. On investing here it is more about timing the peak and trough of assets in the respective market cycles and relative valuations where it might be better off being in private hands.
    Sep 15, 2015. 11:39 AM | Likes Like |Link to Comment
  • M&A Activity In Kurdistan Might Accelerate In Coming Months, Too Cheap To Ignore [View article]
    Great article about the region. I agree the operating risk profile in Kurdistan has improved and balance sheet wise Genel is the safest. One thing I do not like about Genel is its foray into high risk/cost African exploration which the article did not focus on. If they want derisk its portfolio they are better off looking for producing assets.
    Aug 22, 2015. 10:52 AM | 2 Likes Like |Link to Comment