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speedybure (< 20)

Speedy's Top 10 Mining Picks for 2013 # 5-8



October 21, 2012 – Comments (4) | RELATED TICKERS: SVMLF

6) U.S Silver and Gold ~ This new company created between U.S. Silver & Rx. Gold & Silver. Thusfar, the new company has created 2nd largest US. Silver producer. Trading for approx a 160m market cap with production for 2012 of 2.5m oz. Ag & 22,500-25,000 Au. As mining mill optimizations are undertaken plus the Coeur mine coming online in early 2013 will propel production to 5m oz. Ag and 30,000 Au with declining cash costs. This production profile warrants upwards of a 400m+ market cap thus I;m expecting a re-valuation of this company, possibly doubling just in 2013, especially if we average $40 silver and $1,900 gold.

5) Aurcana ~ Since I was able tp put out my 2013 picks ahead of Sinch, looks as if I can pick Aurcana as one of my top picks this year. After seeing record production from la negra. it was very encouraging to see this even though the real gem lies in Shafter( 3.5m oz. Ag in 2013), which should reach design capacity by mid +/- 2013, significantly adding to production. I;m expecting 5m oz. +/- as La Negra (1.5m oz. in 2013) will be operating at its new design capacity (3,000 tpd) as well as meaningful contribution from Shafter. I have voiced my dislike of Aurcana;s capital structure (over 500m shares out. for a relatively small company) but I do think it will start picking up momentum and should silver average $32.50/oz, my NAV, DCF,H-Model, etc show it a likely target for Aurcana is $1.85-$2/share, however, we could see it explode to $2.25 or so.

4) Silvercorp ~ Silvercorp will undergo a gigantic production increase y/y (its fiscal yr ends mid year), as AgEq production will jump from apprximately 5.7m oz.;s to 9.2m in FY 2014 courtesy of the GC mine coming online and a huge increase of production seen from the Ying Mining District, The GC mine (which Rui Feng think will become bigger than the Ying mine over time). Additionally, it should return to boasting a negative cash cost net of byproducts as base metal prices have rebounded following last quarter. I like it so much under $6/share precisely because of all the negative sentinment surrounding the company.

3) Atna Resources ~ This small gold junior (which I picked as a top pick 2 years back when it exploded from 60c to over a $1), should do just the same in 2013 as production jumps from just 38,000 oz.;s to a whopping 125,000 oz.'s +/- 10,000 via its extremely high grade Nevada mine, Pinson (boasting an average grade of 11.4 g/t). Following in 2014, Atna will produce close to 160,000 as Pinson is fully ramped up and the Nevada Mine Reward comes  on stream.

4 Comments – Post Your Own

#1) On October 22, 2012 at 2:34 PM, Jbay76 (< 20) wrote:

On a side note, whatever happened to GPL?

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#2) On October 22, 2012 at 3:06 PM, speedybure (< 20) wrote:

I visited its operations last year and really didn't care too much for them. It was on the same trip with Sinch and I think he would agree Endeavour showed them up hands down. I look at them as an acquisition target but nothing more. Not to say its a bad company, in fact, when i first put on a position back at 44c, It was a great buy but closed it once it passed $4/share, selling my position in 3 tranches from $4 to something around $4.80.

I just think there are so many better investments in the silver industry, buy hey i may be wrong. Sure, money can be made there but far more can be made elsewhere. Although I really like Bob Archer, having a Geo as a CEO has proven not to work out the majority of the time.

For example, I would much rather be invested in the newly created U.S. Silver & Gold which is trading for a meager $160m market cap, which has or will have 3 mines operating and producing 6-6.5m SEO in 2014/2015.

Alexco is another, I think is of much higher quality and now they have two mines coming on in 2013, another in 2014 and 1-2 more in 2015.

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#3) On October 23, 2012 at 9:33 AM, Jbay76 (< 20) wrote:

Thanks Speedy,

I own both GPL and AXU and while both have gotten beaten down, I am still a firm beleiver in AXU, but am lost on GPL (and RBY for that matter).

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#4) On October 23, 2012 at 10:59 AM, kdakota630 (29.07) wrote:

I'm kicking myself for not following your Atna recommendation back when it was at $0.50.  I was cash depleted and kept thinking, "I'll get some later", and then just watched it keep rising and rising and rising.

Glad to know it's still number 3 on your list. 

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