Source: Adrian Day for The Gold Report 03/23/2017
View Original Article
Fund manager Adrian Day discusses several mining and energy companies in his portfolio that he believes should appreciate now that the recently released Canadian budget does not include a tax rate increase.
Many Canadian juniors had seen significant deterioration in prices in the last few weeks, even as gold and large mining companies rallied. This decline in juniors particularly affected stocks that had seen large capital appreciation in the recent past. This was the result of Canadian investors selling shares to lock in capital gains tax rates ahead of a widely anticipated increase in the tax rate. But in the budget just released, the government said there would be no rate increase. We expect, therefore, that there will be some buying back of shares sold in coming days and an overall firming in the Canadian junior market. Below are three stocks (LRA, AXY, MD), among others, that could benefit from such buying.
Strong assets, waiting for partners, court
Lara Exploration Ltd. (LRA:TSX.V, 1.01) continues to deal properties, acquiring new properties that is options out to others, but has hurdles on its two main assets. The Maravaia copper-gold deposit (part of the Curionopolis project in northern Brazil) is behind schedule. However, Tessarema is working towards commercial production at the mine, which is the hurdle is must meet to earn 100% of the project. At that point, Tessarema must pay Lara another US$750,000, which also retains a 2% royalty.
Meanwhile, Codelco (Lara’s joint venture partner) and Vale continue their court case over the Liberdade Copper project, also in Brazil. We remain optimistic on a resolution—if not the timing thereof—that would revolve …read more