Jordino Mine good news
April 14, 2009 – Comments (8) |read comments also they are good
Listed Below are the best Senior, Mid-Tier & Junior Miners(production has recently started, not those who in exploration w/o production.) This is according to discount from intrinsic value. Senior Miners) This is a tough group to narrow, but two of the four listed below are being discounted for the wrong reasons. I chose to leave out the biggest producers except for one.
Yamana Gold - This company dissapointed investors last year with some operating concerns, such as holding on to some mined gold (feeling they could get a better price in the future) which they likely sold at a much higher price in Q1. The market also looked at them like a free-port because a rather larger portion of total revenue derived from copper, whose price dropped like a rock in 08. On average copper contributed appRearoxx 28-35% of total revnue for 08. Investors fail to realize it wall to 17-19%, 12-14% in 2009 and 2010. These numbers are before the most recent upgrade in reserves annouced yesterday as well as a higher than expected grade ore(3/1-5g/t) for the Jordino mine, which holds a lot of promise for future increases. Their reserves are now around 20.4m/oz as the drilling at the Jordino mine was much better than expected. Yamana conitinues to increase their reserves, and i think they will continue to do over the coming years. They will also go from 982k ounces to approx 1.2m/oz, 1.46m/oz which is conservative estimates as they don't include the great news released yesterday. the great results from the Jordino Mine also diversifies their portfolio, which will have the moajority of near term production coming from 5 mines. The valuation the market has on yamana provides a great opportunity, and i think there will be much more good news to come in the near future, especially at the Jordino mine and the two mines next to it. In, Short the valuation, gold price, portfolio diversification, and substancial upside potential (reserve wise), make this my top pick ex-royalty companies.