The bear is out in full force this week! Mining stocks are getting smashed into oblivion, and I’ve got buddies who are now refusing to look at their portfolios!
Yes, I want to conserve some more cash, but I’ve got just enough spare change remaining from my last sale (BAR.TO and FF.V) to make a small purchase today.
Everywhere I look, I’m seeing bargains…
For anyone actively following the mining sector, what’s on your radar?
What would you buy today?
Here’ what I’m eyeing:
- B2Gold (BTG) @ $0.80/share
- Endeavour Silver (EXK) @ $1.12/share
- Ivanhoe Mines (IVN.TO) @ C$0.57/share
- Teranga Gold (TGZ.TO) @ C$0.455/share
Quite honestly, all these stocks look cheap to me… If my funds were unlimited and I didn’t think things might still potentially get worse, I would buy them all!
With BTG, there are concerns with an upcoming financing event, which probably explains the most recent sell-off…
EDR released production results that the market didn’t interpret favorably, with silver production declining 14% in Q4 2015. They are also not the lowest cost silver producer, so there have been (and there still are) concerns about the company’s ability to continue to weather this nasty bear market storm… Still, I like the management team (led by Bradford Cooke) and believe that they will ultimately be a survivor.
IVN.TO has world-class assets, no doubt, but with copper/platinum/palladium/zinc/etc. crashing HARD, it just really doesn’t matter right now… Currently, the consensus is that base metals will continue to nosedive into 2016, so I guess the question is, “What’s the rush to get in now?” Further, the final batch of escrowed shares will be released on January 23, so until that dust settles, everyone is speculating that the selling pressure will remain fierce for the near future… I really like this company, long-term, because you get to purchase a call option on not only copper/zinc, but also on platinum and palladium (should fuel cell technology ever take off)… The recent completed financing with Zijin Mining gives me reassurance that these mines will someday get built! I guess the dark clouds hovering over this company will always be South Africa and Congo…
TGZ.TO is a low-cost gold producer ($964 AISC) operating out of Senegal… With this company, you’re getting 200,000 oz/year production, strong cash balance ($55.1 million), minimal debt (recent revolver drawdown of $15 million), reasonably safe jurisdiction, etc… Most investors prefer Endeavour Mining (EDV.TO), but that stock has run up quite a bit in recent months… and I’ve already got enough Burkina Faso plays in motion…
What would you buy? And are you buying?
I’m leaning towards TGZ.TO.
Most of my friends who are playing in this space are electing, instead, to close their eyes and hope for things to get better soon… It’s tough to stomach this much pain!
It’s been an absolutely devastating week so far for mining stocks, but I remain steadfast in my belief that I’m doing the right thing; I like to buy low even if the popular narrative is that the ship will just keep on sinking…
If it’s going down, I’m gonna go down right with it…