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Regis Resources: Finally A Reason To Buy Again

Jul. 10, 2017 4:05 PM ETRegis Resources Limited (RGRNF)12 Comments


  • On surface, Regis Resources is fully valued.
  • Which is a shame, since this is one of the most reliable gold miners to own.
  • Hidden value is about to surface, finally making Regis Resources a BUY again.

About a year ago, we issued our last in-depth update on Regis Resources (OTCPK:RGRNF) and marvelled at how "Regis Resources has reclaimed its place among the top gold miners to invest in". And, by the same token, we noted how the company represented "Quality At A Price" after the market had re-applied a high premium to the share price. Since then, the company has continued to post one strong quarter after another, has been paying a sector-leading dividend, and has followed our script almost to the dot in addressing the last remaining concerns investors might have had with regards to the Duketon project.

A bargain Regis Resources is certainly not by any valuation metrics, and up until very recently, we would not have recommended an entry to growth-oriented investors as shares appeared fully valued. However, a couple of recent news releases followed by a few phone calls have changed our view, and we have come to believe that behind the disguise of an aptly valued and otherwise boring cash cow, the company has worked on a significant value-add about to be revealed in detail in just a few months' time.

And thus, we believe a strong bull case has emerged yet again for Regis Resources; the present article provides the details.

(Map of Duketon operations. Source: company presentation)

Duketon Review

The Duketon operations include two mills, one at Moolart Well (aka. Duketon North); and another one at Garden Well (aka. Duketon South), with several open pit mines feeding into these mills.

In our last article, we explained how reserves at the ore sources for Moolart Well had been depleted to a point causing concerns among some investors. These concerns have since been alleviated as the newly acquired Gloster resource has been turned into a satellite mine and will contribute ore with a

This article was written by

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Access to award winning research on resource and energy stocks.
Engineer by trade and passion. Have worked internationally for over three decades, running my own business. I hold a PhD in engineering, but honestly believe that the school of hard knocks has taught me lessons that are more applicable to my writing here on Seeking Alpha. My investing interests mostly concern the resource sector, with a focus on precious metals, base metals and energy stocks of all sizes. My research explicitly includes small- and micro-cap juniors, and I try to manage the associated risks in a methodical manner.

Some of my work is available free of charge on Seeking Alpha. If you have come to like these offerings, then please consider joining my Marketplace service called Itinerant Musings where I usually present my best ideas and provide personalized interaction.

Analyst’s Disclosure: I am/we are long RGRNF. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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