Wesdome Gold: The Herd Has Moved On Too Early


  • Kiena Deep is as good as the market thought.
  • Q3 is better than the market cared to notice.
  • Eagle River is about to step up its game.
  • New management has done it before.

Wesdome Gold (OTCQX:WDOFF) could be described as one of the last small Canadian gold miners left standing, a member of a once sizeable peer group that has been decimated by larger players eager to make an entry into Canada during the past few years. Think Brigus Gold, Lakeshore Gold, Claude Resources, or most recently Richmont Mines (RIC) - all of them along with several others have been acquired by larger aspiring mid-tiers who suddenly remembered the virtues of gold mining in Canada; and all of them opting to acquire a small producer with growth potential rather than developing a project themselves.

There are plenty of reasons underpinning takeover speculation, but such speculation just by itself would not be sufficient for us to recommend Wesdome Gold to our readers. Luckily, there is a strong bull case to be made for the company all by itself, a turn-around story with a significant growth perspective consisting of the following ingredients:

The share price has benefitted greatly from the mentioned discovery. However, in-ability to follow through quickly enough paired with a fidgety market un-willing to reward the long-term potential, and in-ability to communicate a coherent story has led to the sub-sequent decline to 52 week lows. A new management team has been installed as a result with a mandate to rectify this situation, and based on past performance we have little doubt about the outcome of the new team's effort.

This article was written by

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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.

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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. 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.

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