Analyst: Mining Acquisition an 'Astute Deal'

Source: Streetwise Reports 04/18/2019 The benefits and terms of the transaction, termed an “astute deal” that both adds value and “removes the M&A overhang,” are discussed in an iA Securities report. In an April 16 research note, iA Securities analyst George Topping reported that Lundin Mining Corp. (LUN:TSX) entered into a definitive purchase agreement to wholly acquire Yamana Gold Inc.’s (YRI:TSX; AUY:NYSE; YAU:LSE) Chapada copper-gold operating mine for $800 million in cash. Topping reviewed how the transaction should benefit Lundin. The deal should remove the overhang on Lundin’s stock, which has been building for more than two years. Shareholders had expected Lundin to make an acquisition, and caused the company to trade at a discount to its peers. On the news of the deal, Lundin’s stock rose 8%. “The market is very happy with a reasonably sized transaction that while not transformational, is accretive, and easy to absorb,” commented Topping. The deal is accretive to Lundin on a net present value per share and a cash flow per share basis, adding $0.26 per share and $0.24 per share in 2020, respectively. By adding Chapada to its project portfolio, Lundin will collectively produce an estimated 670 million pounds (670 Mlb) of copper per year between 2020 and 2025, versus its 440 Mlb produced in 2018. As for the asset itself, Topping commented, Chapada “will be better in Lundin’s hands.” Lundin’s stronger financial position will allow for better optimization of the mine, “with possible opportunities for throughput expansion from 28 to 32 … Continue reading

'Investors Need to Own' This Provider of Well Completion, Production Services

Source: Streetwise Reports 04/18/2019 This energy company’s growth and other prospects are discussed in a Raymond James report. In an April 12 research note, Raymond James analyst J. Marshall Adkins purported that Nine Energy Service Inc. (NINE:NYSE) is a “misunderstood stock within the oilfield sector,” and that given its current valuation, it is “a name investors need to own.” Adkins highlighted three factors that he believes make the story attractive. First, dissolvables will drive growth and free cash flow for Nine Energy. Management said it is confident the company can release a standardized, low-temperature, polymer dissolvable this year, which would likely create a market shift from the use of metallic-based to polymer-based ones. Entry of such a tool onto the market “would start Magnum’s next growth phase,” Adkins wrote—Magnum being the company Nine Energy acquired in late 2018 “based on the adoption of dissolvable technology.” Nine Energy forecasts gaining a 35–50% share of the dissolvables market in three to five years, which “would imply meaningful growth,” Adkins indicated. But he acknowledge that may be a conservative estimate. “If the product is successful, the savings and safety should drive large operators to adopt en masse for full wellbore application.” Whereas dissolvables may subsume the company’s coil operations, it eventually should generate even more significant free cash flow and return on invested capital, the analyst highlighted. Nine Energy should receive near full payout from the earn-out provision tied to the Magnum acquisition. Second, the company has low capital needs and high cash … Continue reading

Watch The Financial Sector For The Next Topping Pattern

April 16, 2019 Chris Vermeulen A very interesting price pattern is setting up in the financial sector that could lead to a very big move in the US & Global markets.  Remember how in 2008-09, the Financial sector and Insurance sector were some of the biggest hit stock sectors to prompt a global market crisis?  Well, the next few weeks and months for the financial sector are setting up to be critical for our future expectations of the US stock market and global economy. Right now, many of the financial sector stocks are poised near an upper price channel that must be breached/broken before any further upside http:/price advance can take place.  The current trend has been bullish as prices have rallied off the December 2018 lows.  Yet, we are acutely aware of the bigger price channels that could become critical to our future decision making.  If there is any price weakness near these upper price channel levels and any downside price rotation, the downside potential for the price is massive and could lead to bigger concerns. Let’s start off by taking a look at these Monthly charts… This first Monthly Bank Of America chart is best at showing the price channel (in YELLOW) as well as a key Fibonacci price level (highlighted by the MAGENTA line).  We’ve also highlighted a price zone with a green shaded box that we believe is key support/resistance for the current price trend. As you can see from this chart, since early February … Continue reading

Solar Power Solutions Firm to Install 1.1MW More Capacity for Repeat Client

Source: Streetwise Reports 04/16/2019 This U.S.-based company continues to expand its presence in the international market. UGE International Ltd. (UGE:TSX.V; UGEIF:OTC) announced in a news release that a repeat client in the Philippines contracted it to install a three-site, 1.1-megawatt system. “The total value of the portfolio to UGE is over $1 million with revenues recognized as the project portfolio is completed; gross margins are estimated to be at or above the company’s current target of 20%,” the release noted. Engineering for the project is underway, and construction is expected to take place through 2019. UGE has nearly finished finalizing contracts with the client to expand its solar portfolio to another three sites. “Our client is growing at a rapid rate, which is driving their electricity consumption and overall operational costs,” said UGE’s regional deployment director, Arjun Gupta. “Going solar is a game changer for these facilities, as making use of the abundant sunshine offers tremendous cost savings through cheaper energy and lower indoor temperatures, while reducing their overall carbon footprint, as well. Best of all, we increasingly see indications of larger opportunities ahead in this market and look forward to further leveraging our extensive local relationships.” Read what other experts are saying about: UGE International Ltd. Sign up for our FREE newsletter at: Disclosure: 1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in … Continue reading

Delrey Metals Announces Positive Airborne Geophysics, Discovers New Magnetic Anomalies

Source: Peter Epstein for Streetwise Reports 04/16/2019 Peter Epstein of Epstein Research provides an update on a company exploring its Canadian properties for vanadium and other energy metals. Delrey Metals Corp. (DLRY:CSE; DLRYF:OTCPK; 1OZ:FSE) has acquired five promising properties in Canada. Four are prospective for vanadium, for a total of 10,856 hectares, and one is a cobalt-copper-zinc opportunity that Cobalt 27 Capital Corp. acquired a 2% NSR on. Management recently signed a non-binding term sheet to acquire an 80% interest in select mineral licenses in the Four Corners Project and to establish a JV with the seller. On Delrey’s website it says the project “conservatively represents a potential target of over 2 billion tonnes.” That’s based on known dimensions and an estimated specific gravity. To be clear, these figures are historical in nature and not compliant with current NI 43-101 standards. Drilling this year will seek to validate the potential large scale of the deposit. Four Corners consists of a 5,157-hectare property located in western Newfoundland and Labrador that has had significant historical work on it. It is transected by Route 480 and a 33 megawatt power line, and located 40 km along a paved highway, east of the deep-water, ice-free Port Harmon Complex. Year-round access to rail & port are crucial for bulk commodities. This is a potentially transformational transaction for Delrey Metals, a tremendous opportunity. A giant, bulk tonnage project in a great jurisdiction, with world-class supporting infrastructure. (Please read press release for further details.) Here’s a recent … Continue reading

Blue Sky Uranium Looking to Significantly Increase Resource of Flagship Ivana Uranium-Vanadium Project

Source: The Critical Investor for Streetwise Reports 04/16/2019 The Critical Investor takes a look at the fundamentals for uranium and profiles a company with a uranium-vanadium property in Argentina. 1. Introduction After publishing the results of the Preliminary Economic Assessment (PEA) for its Ivana uranium/vanadium project in Argentina on February 27, 2019, and filing this study recently on April 12, 2019, Blue Sky Uranium Corp. (BSK:TSX.V; BKUCF:OTC) positioned itself immediately as a low-cost development play in the uranium mining sector. At a low base case uranium oxide (O3O8) price of US$50/lb U3O8, the after-tax NPV8 is US$135.2 million and the IRR is 29.3%. These are very decent numbers as most competitors use US$60–65/lb U3O8 for their base cases. Initial capex is US$128.05M, and the all-in sustaining costs (AISC) net of vanadium credits is US18.27/lb U3O8. This AISC is amongst the lowest in the industry. This doesn’t mean that the entire project is economic at this time as the long-term (or also called contract) uranium oxide price is US$32/lb U3O8 (Source: Cameco), as is any project worldwide except the ISR operations in Kazakhstan and Arrow of NexGen Energy, but it sits at the front of low-cost projects and operations. It is believed by market experts that contract prices need to increase to at least US$50/lb U3O8 before any new project gets developed into a mine, and there are many different views around on this pricing topic if and when this could occur. Blue Sky Uranium has made its mark now, and … Continue reading

'Rock Star' Ian Stalker Applies His Expertise to Nexus' Projects

Source: Streetwise Reports 04/16/2019 The noted engineer, who has a track record of building companies and increasing their value, is now focusing on Nexus Gold. J. Ian Stalker, who has had a long—more than 45 years—and storied history in mining exploration, development and operations, including working in West Africa for more than a decade, has become the non-executive chairman of Nexus Gold Corp. (NXS:TXS.V; NXXGF:OTCQB), a gold exploration company with projects in Burkina Faso and Canada. During his career, he has taken more than 10 mining projects through feasibility, development and construction phases, and has raised more than $500 million in capital investment. His high-level positions in gold mining include stints as managing director of Ashanti Goldfields Co. Ltd., which later became AngloGold Ashanti; vice president of Gold Fields Ltd.; and CEO of Brazilian Gold Corp. Companies under Stalker’s management have seen significant market cap growth. He was the CEO of UraMin, a uranium company that was acquired by Areva for $2.5 billion in 2007. As president and CEO of LSC Lithium, he guided that company to a recent $111 buy-out, a 30% increase in market price. Alex Klenman, president and CEO of Nexus, told Streetwise Reports, “Ian has been on the Nexus board for almost one year, and is now stepping into a greater role as non-executive chairman. He has M&A success behind him, discovery success and development success.” Ian Stalker told Streetwise Reports, “I was part of the team at Ashanti Goldfields when we went from producing 120,000 … Continue reading

What Does the Future Hold for Miramont?

Source: Bob Moriarty for Streetwise Reports 04/15/2019 Bob Moriarty of 321 Gold provides an update on the company’s recent drill results. After some dreadful timing and miscommunication to the market, shares in Miramont Resources Corp. (MONT:CSE) plummeted from $0.47 a share to $0.12 in two days at the end of March. The company dumped some poor results from six holes onto the market and the market gagged. But the scout program consisted of nine holes and on the 12th of April Miramont released the assays from the last three holes. Companies post dismal drill results all the time and it is not a big deal. Especially with a scout drill program, hitting anything is a victory. But the market was told that three areas were being drilled and three holes would be released at a time and was surprised when six holes were announced in one press release. Actually one of the holes, hole five had some interesting potential, but that was lost in the smoke from the forest fire. Hole number nine showed 249 meters of 0.68 g/t gold equivalent and that’s better than interesting. That says there could be something big nearby. 0.68 g/t gold equivalent would be worth about $28.22 a ton in theory. But you couldn’t mine at that depth and mill that at a profit. Now if you had a starter pit or higher-grade material nearby, 0.68-g/t material would change from being waste to being ore if you had to move it anyway. Investors are … Continue reading

Margaret Lake Diamonds' Latest Acquisition, Kiyuk Lake Gold Property, Could Prove to Be a Game Changer

Source: The Critical Investor for Streetwise Reports 04/15/2019 The Critical Investor explains how a recently acquired gold project in Nunavut may completely change the company. 1. Introduction Sometimes you see juniors switching from metal to metal, trying to catch the flavor of the day, riding the hypes with basically worthless projects. So now diamonds are out of favor, and gold is back in vogue, could it be that Margaret Lake Diamonds Inc. (DIA:TSX.V; M85:FSE) is pulling the same trick with its latest acquisition? There are two important factors opposing this possibility in my view at least. First and foremost there is exploration legend Buddy Doyle who didn’t only discover diamond deposits but also 15 Moz of gold deposits in the past. This all-star geologist has a serious reputation to lose. Furthermore he isn’t the person to give away anything easily, as I experienced first hand when I tried in vain to assist with a financing of a UK fund at the end of 2013 for a cash-strapped Amarillo Gold, where he was the CEO at the time. The money was on the table, but he refused to surrender to the pretty tough terms. I found it to be a pretty bold action at the time, but I also have to give him credit for being adamant on the share structure. The second factor is the new Kiyuk Lake gold project itself, located in southern Nunavut, being acquired at the moment. Although nordic and remote, not too often do you see … Continue reading

God Bless Winston

Source: Michael J. Ballanger for Streetwise Reports 04/15/2019 Precious metals expert Michael Ballanger, along with discussing Winston Churchill’s brilliance with the English language, covers recent moves in the market and a uranium company that he believes is well situated. “‘Success consists of going from failure to failure without loss of enthusiasm.” – Sir Winston Churchill Throughout history, society has always canonized certain political, military, and religious icons for reasons seemingly obvious, but after drilling down into the fabric of such, what surfaces is that generational memory is aided and abetted by those who would seek to monopolize public opinion by piggybacking upon those very achievements responsible for the canonization. Sir Winston Churchill was a soldier, an author, a politician, a Prime Minister, and finally, an historical icon of immense magnitude. Not only was he one of the most distinguished users of the English language, he was a brilliant strategist. The famous Lady Astor was the first female ever elected to the British Parliament who was also vehemently opposed to everything that Churchill represented to the degree that this exchange of wit toppled stanchions: Lady Astor said to Churchill: “If you were my husband, I’d poison your tea!” Churchill to Lady Astor: “Madam, if you were my wife, I’d drink it!“ Another superb exchange just prior to a high-profile Masquerade Ball… Churchill to Lady Astor: “What do you think I should wear?” Lady Astor to Churchill: “Sobriety.” The greatest of all Churchillian zingers was his interaction with a certain Bessie Braddock, … Continue reading