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Comstock Mining: A LODE Of Gold Waiting To Be Grabbed

May 04, 2021 9:30 AM ETComstock Inc. (LODE) Stock36 Comments
Joshua Sorto profile picture
Joshua Sorto


  • Comstock is a mining company that is expanding into new potentially lucrative businesses.
  • Comstock has been undergoing a multiyear reorganization so it has very little revenue.
  • None of the exciting growth has materialized yet.

Golden rock in the old mine
Photo by Ivan Boryshchak/iStock via Getty Images

Investment Thesis

Comstock Mining (NYSE:LODE) is a mining company that is expanding into more profitable non-mining businesses via joint ventures and acquisitions. The Mercury recapture business and the LiNiCo battery rejuvenation process hold

This article was written by

Joshua Sorto profile picture
I am a Florida Licensed CPA in public accounting. I'm a huge nerd for equities in general and I find researching companies fun. I've decided to start writing because I want to be an active participant in the investment community and I believe writing about stocks is the best way to hone my expertise. I am looking forward to all the feedback I receive, both the good and the bad. Thank you for taking the time to read and react to what I write. Associated with another SA Contributor Johannes Sorto

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in LODE over 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.

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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Comments (36)

I wonder if we could get an update from the author on his thesis?
Our Q3 earnings, as we are down over 50% since publishing.
Damon Judd profile picture
Joshua, every time I find a stock that I like it seems that you have written a recent article covering it and confirming my reasons to invest. Thanks for digging into the details of their business transformation. I am starting a speculative long position in LODE.
Joshua Sorto profile picture
@EnigmaDude I'm happy you find my articles valuable. I'm looking forward to their next quarterly report to see how the Philippines operation is doing.
@Joshua Sorto what do you think about LODE joining the Russell micro cap index? Is that a legit Index? Will it at attract institutional investors?
Joshua Sorto profile picture
@MikeFarquad the general rule about a stock joining an index is this. Typically a stock temporarily pops when joining an index, then returns to its normal range. This applies even to Tesla which joined the biggest index as a top holding. Most companies join an index as one of the smallest components.
Pure unadulterated gambling stock.
Joshua Sorto profile picture
@Campbell Can There are a few important differences between a "pure unadulterated gambling stock" and Comstock.

1. There is no debt and several million in cash giving the business a chance to succeed.
2. Pure unadulterated gambling stocks are not based on reality. Doge coin for example, unlike other altcoins that have some snazzy tech that's suppose to do something someday Doge coin does nothing and was created with the intent of doing nothing.
3. Comstock is in fact doing real tangible things that we can see and touch. They have an operation in the Philippines to decontaminate a site and the decontamination process should produce by products that generate income.

Whether or not the strategy is successful is a risk, but its the same risk every legitimate business takes.
@Joshua Sorto an operations inthe Philippines is so close to their headquarters they can use binoculars to see it.

So they are driven by benevolent virtue to clean up the planet by heading halfway around the world?

Why not head over to Yerrington to clean up the superfund disaster.

Better yet, clean up the Mercury entering the waterway that is like 200 feet from their leach field in American Flat?

Oh, wait. I know. They cant fleece investors by doing actual good deeds.

These clowns are spectaculr swindlers, nothing more.
Joshua Sorto profile picture
@Sam Toll we will know before the year is out.
We finally have analysis from SA on LODE. It is split. Some say scam and short it or avoid it. Others say new business being brought on is legit and it could go to $12 bucks. Mercury and lithium.

Its a little confusing. who's right.. are we buying or selling!!!???
Joshua Sorto profile picture
@MikeFarquad If you are on the risk averse side, I would wait for the Q1 earnings to come out. In March the CEO said that MCU-P was up and running so we should get some indication of whether or not it will generate $1 million a month.

I personally have a high risk tolerance so I bought $100 worth of shares this morning.
@Joshua Sorto I appreciate the insight. Thanks! Risk averse hopefully gets better with age. 6% is not enough ha
@Joshua Sorto At the rate the Fed is using the magic keyboard to create trillions, $100 ≠ high risk.

Pretty soon $100 = a coffee...
Hi Josh,

Thanks for the article. I'm a shareholder and have done well since I first bought it around $1, and agree that the company has decent prospects. Recent performance of the stock price has hurt a bit, though.

I have a question on the short seller report: It's quite shocking how the hedge fund went after the character of some people working for the company, even going as far as pointing out a potential conflict of interest involving a consultant that would also be a brothel owner--such a bizarre claim for an investor report in my opinion.

Can you elaborate as to why you think the "grace" with which Conrado responded to the report should be interpreted to provide confidence in their candor relating to the company's future? Isn't there a risk that this grace actually means the opposite--a lack of conviction that the short sellers are wrong? Put differently, if someone makes such bizarre accusations against the organization you lead, shouldn't the adequate reaction be a sort of rightful rage?

Thanks again!
Joshua Sorto profile picture
@Daniel Sternick So the simple version is, if someone insults you, we live in a culture that accepts a vigorous defense that would involve insulting the person that insulted you first. A more "mature" response would be to dismiss the insult without giving an insult. A classy response would be something like "Well I get why you would think that, but I'd like to show you why I'm not stupid."

A longer version of the above is provided below.

I don't read short reports, but I've seen others write about the information provided in short reports. Essentially most short reports are of low quality and are like tabloids so I don't think its unusual for a short report to include smears of character.

As I mentioned we live in a time when management could respond to a short report with an insulting comment along the lines of "They're liars, they get paid to tell lies, while main street sees wall street as scum, short sellers are the scum of wall street" and we would view such a response as fair and appropriate.

Since short sellers are tabloids, the highest form of criticism you could give them is to be dismissive with something along the lines of "We aren't concerned about short reports" So the classy thing to do would be to take their report as a legitimate piece of work that is attempting to raise concerns and extending an olive branch to them to show them why they reached an incorrect conclusion.
Good article, enter at your own risk-reward levels. I’ve made $ off their options. I really do hope they start making money on all their ventures soon..
Anyone can claim ESG for anything. There is no single standardized definition. So many buzz terms are like this. 50 people have 40 different definitions.
Joshua Sorto profile picture
@Hank890 I agree, which is why I avoid using the term. Removing mercury, is removing mercury which is something several dozen nations have committed to doing.
Jon12483 profile picture
Ive been watching this company since the Goldspring days of 2008. They were a fraud then, and they are a fraud now. Gasperis is a word master who always puts out pie in the sky projections that never come to pass. They make NO MONEY!!. Then they dillute their stock so Gasperis get his $250k salary for literally doing nothing. Avoid this company!! There are better places to park your money.
Joshua Sorto profile picture
@Jon12483 Well given that the philipine operation is up and running, and the other very specific actions Gasperis has claimed will take place this year we will find out how much money they are making very soon.
Comstock Mining is a real estate company whose most successful mining operation has been to mine investors and separate investor cash from investor wallets.

The Comstock Lode in the 1860-80s was rife with stock swindlers and scheisters who couldn't hold a candle to Comstock CEO Corrado de Gasparis.

Look at the company's storied history of red quarterly and annual statements, reverse stock splits, and all that amazing revenue from gold mining. Compare that with the CEO's ability to unearth suckers and rubes to buy into his huckster's dream scheme.

Virginia City, Gold Hill, and Silver City held the world's richest cache of gold and silver. It was mined out by the 1880s. There ain't no more gold in them thar hills.
@Sam Toll

The largest veins were mined out long ago using 19th century techniques.

But mineral bearing ores are still common in the vicinity, the problem is merely how to mine them profitably, using innovative (less expensive and cleaner) methods.
Joshua Sorto profile picture
@Sam Toll That is a very real possibility, my analysis is based on the new businesses coming on that have nothing to do with gold mining.
@Joshua Sorto since it’s inception, CMI has had nothing to do with gold mining.

Hopefully, with their new ventures, they can do something that resembles actual business.

Sadly, it will be too late for the people who lost millions betting on de Gasparis’ past fantasies.
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