Experts See Opportunity in Ratios of Gold to Silver and Platinum

Source: Maurice Jackson for Streetwise Reports 01/23/2020 Andy Schectman of Miles Franklin Precious Metals Investments and Maurice Jackson of Proven and Probable discuss investment strategies centered on precious metals ratios. Maurice Jackson: Joining us for a conversation is Andy Schectman, the president of Miles Franklin Precious Metals Investments. Always a pleasure to have you on the program to discuss the value proposition before us in precious metals. Today we will identify three exciting value propositions for your precious metals portfolio that are currently selling at a deep, deep discount. Mr. Schectman, you have a proven pedigree of success in the precious metals space. I want to discuss a methodology that has made you and the clients of Miles Franklin very handsome returns over the years, and that is your use of ratios. Sir, please explain why it is paramount for precious metals investors to have a thorough understanding on precious metals ratios. Andy Schectman: When we last spoke I shared that legendary investor Rick Rule is fond of saying, “the deal’s in rhetoric,” and he deals in arithmetic. I like to look at the world the exact same way, from the standpoint of arithmetic, and at least in terms of any precious metals investor, ratios are very, very, very important in mathematics. They are another way of saying the law of averages. As we look at ratios that fall out of historical average, they represent opportunities—in fact, distinct opportunities. I guess the easy way of saying that is the farther … Continue reading

Golden Arrow Resources Renegotiates Indiana Project Deal; Ready for Drilling and a Potential New Precious Metals Bull Market

Source: The Critical Investor for Streetwise Reports 01/23/2020 The Critical Investor provides an update on this explorer’s Indiana project in Chile. Golden Arrow Resources Corp. (GRG:TSX.V; GARWF:OTCQB; G6A:FSE) recently came out with some pretty interesting news on its Indiana gold project in Chile. The company managed to amend the definitive agreement with the property owner, Mineria Activa (MSA), a Chilean private equity investment management firm focused on exploration to production-stage assets in mining. Golden Arrow now has the right to earn 100% of Indiana over a 74-month period, expiring in December 2024, and the total cost of US$15.1 million has not changed. However, the payment of US$1 million due to the end of 2019 was reduced to US$150,000, and the subsequent payment of US$2 million due in one year is reduced to US$200,000. Another great advantage is moving US$7 million of the total US$15 million payment obligation for the 25% MSA interest during production after a production decision, meaning that MSA will be bearing execution risk now. This is obviously a great advantage to have as hard dollar commitments have been scaled back significantly this way, and that money can be spent at exploration. I was interested in the fact that this agreement could be adjusted so considerably after a relatively short period of time, during what seems to be the first innings of a new precious bull market. After asking VP Exploration and Development Brian McEwen a number of questions about this, he had the following insights to share: … Continue reading

Explorer 'On the Road to Production'

Source: Streetwise Reports 01/21/2020 The next steps for the precious metals company are provided in a ROTH Capital Partners report. In a Jan. 17 research note, analyst Jake Sekelsky reported that ROTH Capital Partners raised its price target on SilverCrest Metals Inc. (SIL:TSX.V) to $7.75 per share from $7.25. The current share price is $6.85. “Our increased valuation is primarily a reflection of rolling our model forward to 2020, coupled with the inclusion of the company’s financing announced in Q4/19,” he added. Sekelsky noted that SilverCrest will be announcing in Q1/20 results from several hundred holes drilled at the Las Chispas property in 2019. It will include all results available through the end of Q1/20 into the upcoming feasibility study. After, it will likely shift focus “from infill drilling for the feasibility study to expansionary drilling at various targets across the company’s land package,” he added. The analyst highlighted that with C$124 million in its treasury, SilverCrest is well funded for both exploration and development work this year. Its financial position also portends a positive production decision, expected around mid-2020. Accordingly, production could begin as soon as late 2021 but more conservatively in Q1/22. Sekelsky commented, “2019 featured significant exploration success culminating in the establishment of what we view as a significant resource estimate at Las Chispas, which outlined over 100 million high-grade AgEq ounces. Despite this, we believe the surface has just been scratched as Las Chispas and expected 2020 to serve as a transformational year.” ROTH has a … Continue reading

Gold Company's 'Ramp-up to Commercial Production on Track for Q2/20'

Source: Streetwise Reports 01/21/2020 An update on the project and its production is provided in a Haywood report. In a Jan. 10 research note, Haywood analyst Kerry Smith reported that Lundin Gold Inc. (LUG:TSX) remains on track and on budget to achieve commercial production at its Fruta del Norte project in Ecuador in Q2/20. “Fruta del Norte is one of only a few new large mines being built,” Smith highlighted. Lundin poured first gold from the gravity circuit at Fruta del Norte on Nov. 16, 2019, after which it went on to produce 28,678 ounces of gold in 2019. Of those, 3,411 ounces were made into doré form, and the remaining 25,267 ounces were produced as a concentrate. Of the 3,400 tons of concentrate produced, 2,676 tons were shipped to a smelter in Finland. Smith also reported on development progress of the mine and infrastructure. At year-end 2019, 13 kilometers of underground mine development were finished. Construction was 99.2% complete, and ore stockpiles amounted to 153,000 tons. Now, the water treatment plant is being commissioned. Boring of the south ventilation raise, in progress, is slated for completion in Q1/20. Lundin should get the paste plant and Zamora River bridge, which still need to be done, completed in Q2/20 and Q3/20, respectively. The analyst pointed out that Lundin revised its life of mine plan for Fruta del Norte. It raised the all-in sustaining cost (AISC) by about 6.5% to US$621 per ounce from US$583; the new figure is lower than Haywood’s … Continue reading

Gold Update: May Retreat Before Next Upleg

Source: Clive Maund for Streetwise Reports 01/20/2020 Technical analyst Clive Maund looks at the charts and finds that gold may react back before continuing to climb. At first glance gold looks like it may be about to advance out of a bull Flag, but there are a number of factors in play that we will examine that suggest that any near-term advance won’t get far before it turns and drops again, and that a longer period of consolidation and perhaps reaction is necessary before it makes significant further progress. On the 6-month chart we can see how gold stabbed into a zone of strong resistance on the Iran crisis around the time Iran’s general was murdered, but after a couple of bearish looking candles with high upper shadows formed, it backed off into what many are taking to be a bull Flag. The 10-year chart makes it plain why gold is vulnerable here to reacting back over the short to medium term, because it has advanced deep into “enemy territory”: the broad band of heavy resistance approaching the 2011 highs, with a zone of particularly strong resistance right where it is now. It would be healthier and increase gold’s chances of breaking out to new highs if it now backed off into a trading range for a while to moderate what now looks like excessive bullishness. Thus it remains a cause for concern (or it should be for gold bulls) to see gold’s latest COTs continuing to show high Commercial … Continue reading

Palladium Miner Shows Promise

Source: Ron Struthers for Streetwise Reports 01/20/2020 Given current market conditions, the location and potential of its flagship project, and the strength of its management team, Ron Struthers of Struthers’ Resource Stock Report believes this firm represents a solid investment. I have been looking for a very good junior palladium stock, and I believe this is the best one out there for potential enormous gains. But before I get to that, it is important to have a look at the palladium market, because this bull market is much different than the last one. The one from 1997 to 2000 was about three years’ long, and then palladium dropped, giving up most of the gains in less than a year. There was a nice bump up from the 2008 crisis and then the price traded sideways for several years. The price bottomed at the end of 2015 with the severe bear market in precious metals. Since then the price has been going steadily higher, with a major break out in 2016. This bull market is not going to end anytime soon for the reasons I will show you in the next couple pages. Palladium is mostly used in the auto industry for pollution control with catalytic converters. Electric vehicles will be a long time coming to replace any significant amount of gasoline/diesel-driven vehicles. Meanwhile, pollution standards are being tightened that will keep demand high. China has been gobbling up palladium since their China 5 pollution standards took effect in 2013. China … Continue reading

Silver Update: Expect a Price Decline

Source: Clive Maund for Streetwise Reports 01/20/2020 Technical analyst Clive Maund charts silver and predicts a small drop in the price of the metal. If gold is looking set to react back over the short to medium term, which it does, then it implies that silver, which is weaker at this stage in the cycle, is set to react back too. On silver’s latest 6-month chart we can see that the fairly tight pattern that has developed over the past several weeks, which is widely interpreted to be a bull Flag, is now looking more like a small Head-and-Shoulders top, and being small, it has correspondingly small downside implications. It projects a drop soon at least to the upper boundary of the channel that silver broke out of in December. Factors making it more likely that the pattern is an H&S top are the way the advance reversed at resistance at the late September highs, with a dramatic high volume reversal candle appearing after a string of bearish looking candlesticks with long upper shadows, and, of course, the extreme positions evident on the COT and Hedgers’ charts that we will come to shortly. Should silver drop back now or soon it shouldn’t have much effect on its long-term chart or outlook, for as we can see on its 10-year chart, it is still within a large base pattern and could drop to support in the $16 area, without doing any significant technical damage. Silver’s latest COT chart shows that there … Continue reading

The Only 'Bubble' That Counts

Source: Michael Ballanger for Streetwise Reports 01/20/2020 Sector expert Michael Ballanger considers the last week in the stock and precious metals markets. Ever since Sept. 19, 2008, when Hammerin’ Hank Paulson appeared in front of the U.S. Congress on bended knee and begged those clueless politicians for a bailout—which he did successfully—the spread of moral hazard throughout the world has been a contagion that makes the Bubonic plague appear as harmless as the common cold. That was, in fact, the day that shall go down in fiscal infamy as a most dangerous precedent was etched into the fabric and soul of the U.S. financial system. Not only did it set the behavioral course for the banker-politico alliance, it laid out as an insidious blueprint the operation manual for treasury departments and central banks around the world, the result being where we are today, a global economy teetering on an Mount Everest of debt with no solution on any horizon. This week the investor class has seen the continuation of an advance in that began with the first whispering of the phrase “repo operations” in September, the realization of which did not manifest itself until late October, when I penned the missive “Q4 Guesstimates.” As I wrote in September, “I have the feeling that the PPT, with DJT at the helm, is going to go all-out in making damn sure that we have a booming stock market going into 2020, so that his re-election chances don’t suffer from the ‘It’s the … Continue reading

Platinum Group Metals' Shares Trade Up 35% on Waterberg Mine Prospects and Soaring PGM Demand

Source: Streetwise Reports 01/17/2020 After opening flat today, shares of Platinum Group Metals Ltd. climbed to a new 52-week high price fueled by high demand and increases in platinum group metals prices. The firm claims its primary objective is now the advancement of the palladium dominant Waterberg Project in South Africa. After reporting quarterly earnings earlier this week, Vancouver-based platinum and palladium focused mining company Platinum Group Metals Ltd.’s (PTM:TSX; PLG:AMEX) shares traded more than 35% higher today establishing a new 52-week high price of $2.869 per share. The firm recently announced Q1/20 financial results for the period ending November 30, 2019 and provided a summary of recent events along with an updated outlook. For Q1/20, the company reported a net gain of $0.55 million compared to a net loss of $5.64 million in Q1/19, and posted a basic and diluted gain of $0.01 per share for Q1/20, compared to a loss of $0.19 per share in Q1/19. The company further advised that in December 2019 it closed a non-brokered private placement of shares resulting in gross proceeds to the company in the amount of $4.0 million. The company advised in the report that at present it is mainly focused on advancing the palladium dominant Waterberg Project located on the North Limb of the Bushveld Complex in South Africa. The firm noted that a published independent Definitive Feasibility Study (DFS) last September indicated that “the Waterberg Project will be one of the largest and potentially lowest cash cost underground PGM … Continue reading

Explorer's Upcoming Resource Estimate Update Should 'Show Growth'

Source: Streetwise Reports 01/16/2020 The potential of this company’s asset is discussed in an Echelon Wealth Partners report. In a Jan. 10 research note, Echelon Wealth Partners analyst Gabriel Gonzalez purported that Revival Gold Inc.’s (RVG:TSX.V) updated Beartrack and Arnett Creek resource estimate, expected between mid and late Q1/20, should show growth and that “potential for much more” exists. Echelon expects the updated gold resource to be between 2.7 and 2.8 million ounces (Moz). This compares to the current resource of 2.36 Moz, composed of 1.99 Moz at Beartrack and 380,000 ounces (380 Koz) at Arnett Creek. The new estimate will include results from 15,000 meters of drilling done in 2018 and 2019 and “may also benefit from improved metallurgical recovery factors as well as an updated gold price,” Gonzalez wrote. The analyst noted that next step for Beartrack and Arnett Creek after the resource estimate update is a preliminary economic assessment (PEA), which will evaluate the possibility of a “heap-leach production restart scenario with Beartrack’s current 330 Koz (Indicated plus Inferred) heap-leach resource.” Gonzalez added, “We believe such economics could be fairly attractive relative to a comparable greenfield project, given the existing gold adsorption recovery production plant at Beartrack and commensurate upfront capital savings.” Also, Gonzalez pointed out that between Arnett Creek and Beartrack, Revival could grow the total resource further, perhaps even beyond 3 Moz. For one, based on 2019 geophysics and sampling results from Arnett Creek, there are prospective areas there that need to be drill tested. … Continue reading