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ANV - Buy Or Sell?

|Includes: Allied Nevada Gold Corp (ANV)

I am not sure why ANV is trading so low. It's price to book is .45. Most of the miners are trading at book value of 1 or better.

It's price to sales are mere 1.21 when there is 100-200% growth. It's a growing company and I think it's cheap when you consider growth. If you look at quarterly results it's gold production is almost tripled. Silver production is more than doubled. The only reason I think this stock is trading at such discount because holders are getting panic or frustrated, may be weak ones. May be the company debt is scaring investors when debt is so cheap and inexpensive. I think Allied Nevada is making right move by taking more debt to grow the company when debt is so cheap. I don't think it's bad at all when it's growing at this rate. This is ideal acquisition candidate. Goldcorp (NYSE:GG) is looking go buy some miners and I would highly doubt if ANV is not in the list.

I also believe some powerful short sellers are spreading same old news over and over again to drive down the stock price. Lawsuits on Allied Nevada is not new and keep publishing the same news over and over again. Even if the lawsuits are successful, I don't think it will be more than 3 or 4 million. That's not hard to handle when you have 20 million from recent sale (Completes 75% Divestiture of Hasbrouck to West Kirkland Mining - .

If it's a technology stock, it would be probably trading around 30 for it's growth and efficiency. Allied Nevada cut down the gold production cost by 30% to 809$. This gem will produce profits when gold rebounds or even stay flat for this year. Stock price will go through roof when investors pay attention & really dig in to the value of this company.

Its institutional ownership is high at 70%, So the knowledgeable holders are not selling the stock. That's a good sign and there is very good possibility of rebounding back to 4$ range very soon. I believe this is right entry point even for short term traders.

Even if you think like a contrarian, it's good because the short float is very high at 30%. Based on renowned Growth/Value guru (James O'Shaughnessy's - analysis , it is a buy.

Stocks are volatile in the short term and profitable in the long term. This fits the bill perfectly and I am not selling any of it.

Disclosure: I am long ANV, GDX, IAG.