Quick Evaluation of Several Gold and Silver Mining Companies

motowngold (49)in #gold • 7 years ago (edited)

I am introducing myself with this article I have put together pertaining to gold and silver which is one of my passions. I also like to evaluate alternative news, crypto currencies, conspiracy theories, and contrarian points of view and much more as I have a wide variety of interests.

Mining companies go up and down at times like rocket ships, and they are not for an investor that does not understand this trait of theirs. They can be a very profitable and exciting diversification to ones portfolio at times and it appears we are nearing a bottom of a correction that has dropped prices and could provide a great entry point into the right companies. I invest only in companies that have proven assets, near term production or in production and not exploration stocks that are still ‘looking’ for viable deposits. This is how I make my picks for myself thru the years, by doing my homework.

I love hearing what the CEO's have to say about their own companies as well as using the corporate presentations as a source for a good starting point. I tried to glean the key points from recent information that has been released with a little added opinion in a way that would not make a readers eyes gloss over yet give them enough to decide on if they should explore any of the companies further. All the companies I investigate, I either own, want to own, used to own, or the info eliminates them for me of further consideration and this becomes a great resource for me to decide on what to invest in for myself either now or in the future.

Americas Silver, symbol USAS.
Has a 60 year mine life, no hedging or royalties, low float, so it has great leverage to any upside in the metals. Producing assets are in Idaho and Mexico and they mine, mostly silver, lead and zinc. Should have a very low, possibly even negative AISC ( all in sustaining cost to mine) next year with the new Mexican mine coming online. They could also be heading towards a near 8 million ounce silver equivalent production output down the road and coupled with that low float, and lost cost of production, it gives them huge, huge leverage if all comes together for them and the metals start heading up. If so, this one could really take off price wise. Around 50 million shares outstanding so a very low float.

Alexco, symbol AXU.
Finally restarting production with the Silver Wheaton royalty problem fixed as it was too draining of profits the way it was formerly structured. Another big development, they have discovered a couple new amazing rich silver properties that can be measured in pounds per ton silver when put into production. They had a terrible deal with Silver Wheaton for 25% of their production which basically kept them out of production for the last few years that is now re-written to much more favorable
terms. They will be starting up their return to production with the same assets they had
before, plus these other huge hi grade deposits added to that. In total could be mining at an average rate of 4 million ounces per year. Very hi grade silver properties are open at strike for future added ounces on the exploration front which could keep this asset going indefinitely. Production will produce very good clean concentrates which is a plus and would add to the bottom line as well. It only has 105 million shares out, so lots of leverage to silver both as a production and exploration asset.

Avino, symbol ASM.
Another with very low float 60 mil shares out. Production of silver equivalent expanding to 4 million ounces coming Q1 next year from less than 1 million just a short while ago. Has huge exploration potential as well as leverage. The once very rich Bralorne Gold mine kicker coming into play late this
year. The gold mine has never explored with modern methods and they are building a new and positive relationship with the Canadian First Nations to be a part of this exciting new opportunity. Samsung has an agreement in place taking Avino’s silver product at spot as a guaranteed source for them. Another source of mine production, a huge old tailings resource will be extremely cheap to extract the silver from and add another 1.5 million ounces for 7 years when they put it into production.

Coeur Mining, symbol CDE.
Totally overhauled from 4 years ago, eliminated almost 400 million in debt with growing cash
flow. 5 different mines, 3 in the US, plus exploration properties. They had IMHO very poor management previously, and most of the turnaround can be attributed to getting rid of those seemingly disinterested in shareholder value managers. The new management has a plan and has been successful in executing it thus far. Very liquid stock is a plus for institutional ownership. Right now around 60% gold- 40% silver in revenues equals yearly production of 375,000 ounces gold and 17 million ounces silver, or about 40 million silver equivalent production. Currently a 16 dollar area AISC is dropping from way higher costs not long ago. This is one of the bell-weather silver stocks but is really just as importantly a gold stock. Another important fact, while many silver stocks really are equally base metal stocks, this is uniquely positioned as more of a precious metal miner. Shares Outstanding, 181,055,852

Detour gold, symbol DRGDF
Huge 16 million ounce gold reserves, currently replacing them every year with newly defined resource through exploration. Expecting to have increasing grades ahead that will improve profit and they will be nearing 670,000 ounce production in 2018. Looking at adding hi grade underground mining to the current open pit production. AISC at around 1100/oz gold and dropping eventually to 758. Only hedged about 90,000 ounces so has retained its leverage for anticipated higher gold prices. 130 mil in cash on hand, 450 mil in debt. Lots of leverage, 23 year life of mine, the risk is in the high debt, current refinancing objectives being secured, and in being a 1 property only operation. Shares Outstanding 174.57M

First Majestic Silver Corp, symbol AG
Purest silver company in production in the world with 70% silver revenues.
Balance sheet strong, 130 million cash, 30 million debt. 9 properties are all in Mexico. 18
million silver equivalent production at 12-13 dollar per ounce AISC. Leverage with higher production
capacity that can be quickly brought on line at higher silver prices, 165 million shares out standing provides one of the most leveraged to the price of silver mine stocks. Another very important factor for this and all mining companies is management, and this company has great management with a proven track record.

First Mining Finance Corp, symbol FFMGF
Same basic proven management as First Majestic. They were buying cheap already proven ounces in the ground of distressed miners when the prices were at the bottom. Example of their business model, they bought the Springpole project for 15 million when previous company had spent 80 million developing it with proven ounces in the ground. They want to divest these properties they have acquired for streams and pay a dividend down the road. Mostly gold focused properties they have targeted thus far. Accrued 7 million ounces measured/indicated and 5 million inferred in the current assets all of which are thought to be able to be profitable at today’s metal prices. 29 million in cash, little debt. It is now focused on drilling current properties to prove up more ounces. 623 million shares outstanding.

Hecla Mining Company, symbol HL
Company was founded in 1891!! Biggest plus, huge reserves and very long term assets that will last into the decades. Biggest negatives, 395.44M. shares outstanding, and it seems it has a sometimes rocky relationship with employees. Also for some a negative, it is a huge base metal miner although with current prices, that is a big plus. For me, it is simply a fact that must be understood. 17 mil ounce silver production or 46 mil silver equivalent. They have great assets with gold, silver and base metal production. Personally, I have not always been thrilled with the management over the years although they are very capable, and I have owned it on and off as it is a very liquid mining stock and has institutional ownership. Two newly acquired silver/copper properties in Montana have huge, huge potential for output and once fully permitted and in production 6 years or so from now and will operate for 30 years or more.

Integra Gold, symbol ICGQF
I have been watching this one for years. They are claiming they will have a pretty low 824 dollar AISC for planned 140,000 ounce gold production when fully running, ramping up now for beginning production for 2018. Their property has bankrupted 2 previous owners which makes me nervous but they say new discoveries are game changing. 480 mil shares out which is a negative for me as it hurts leverage and ability to raise money. Has a sizeable 2 million ounce deposit. A real bonanza move for them, they bought the 100 million dollar plant next door for 7 million.

International Tower Hill Mines, symbol CDE
Gigantic large single asset of 9 million ounces in Alaska is one of the very few extremely large undeveloped assets out there in a world where finding new gold to mine is becoming a real problem for most mining companies. Biggest problem is the asset is very low grade at 0.71 grams per ton. Too low at current metal prices to mine profitably, maybe to low of a grade at almost any metal prices. 170 mil shares out.

Thank you for taking the time to read this article. If you like what I have put together and find it of value, let me know by commenting, upvoting and liking the article on Steemit and it will encourage me publish again as I go through more companies in a similar fashion and will even go more in depth into individual companies, other investment opportunities I am interested in, as well as well as share info on some of my other interests.

My disclaimer, The above references are an opinion and for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.

MOTOWNGOLD!