Nuveen California Municipal Value Fund Inc T.NCA

Primary Symbol: NCA

Nuveen California Municipal Value Fund, Inc. (the Fund) is a diversified closed-end management investment company. The Fund's investment objective is to seek current income exempt from both regular federal income taxes and California personal income tax. Its secondary investment objective is the enhancement of portfolio value. The Fund invests in municipal securities that are exempt from federal and California state income taxes. The Fund invests at least 80% of its managed assets in securities rated, at the time of investment, investment grade or, if they are unrated, are judged by the manager to be of comparable quality. The Fund may invest up to 20% of its managed assets in municipal securities rated below investment quality or judged by the manager to be of comparable quality, of which up to 10% of its managed assets may be rated below B-/B3 or of comparable quality. It also invests in inverse floating rate municipal securities. Its investment adviser is Nuveen Fund Advisors, LLC.

NYSE:NCA - Post by User

Nuveen California Municipal Value Fund Inc

<< Previous

Bullboard Posts

Next >>

Post by retiredcfon May 16, 2017 9:00am

203 Views

Post# 26248607

TD

Maintain their $2.00 target. GLTA

NewCastle Gold Inc.

(NCA-T) C$0.79

NewCastle in the Big Picture Event

After five years of declining reserves and deleveraging in the gold mining industry, we see the sector as being in the early stages of a reinvestment cycle. In this note, we discuss our sector thesis and how our NewCastle view fits within that.

Impact: NEUTRAL

The early part of a reinvestment cycle is, in our view, marked by cautious investment by the seniors through strategic investments (e.g., Newmont's into Continental Gold), joint ventures (e.g., Barrick's deals in Chile and Argentina), and deep value/synergistic acquisitions of small to moderate size (e.g., Goldcorp acquiring Exeter).
Eldorado's acquisition of Integra, announced yesterday, is another example of a modest deal early in the cycle. In our experience, these are generally not well- received by the market, which is still, in our view, placing a premium on free cash flow generation and balance sheet strength.
However, as the cycle progresses and the market transitions to focus on growth, we see the senior gold producers more aggressively adding projects (at higher valuations) to re-stock and upgrade their development pipelines.
Later in the cycle, we would expect to see large, i.e., >$1 billion acquisitions of development projects (e.g., Goldcorp outbidding Eldorado to acquire Andean for $3.6 billion) and at that point, we would expect these to be well-supported by the market.

TD Investment Conclusion

In our view, NewCastle is one of the very small group of juniors with a robust development project of a globally significant size in a geopolitically safe jurisdiction. We believe that the company is currently a candidate for a strategic investment by a forward-looking senior/mid-tier and may become an outright acquisition target once the project is de-risked.

Based on feedback from clients, we believe that three issues have kept investors on the sidelines and prevented the company from achieving a multiple in line with its development-stage peers: (1) permitting concerns given its residence in California; (2) concerns regarding the availability of water given its location in the desert; and (3) concerns over the economics given the low grade. We believe that these concerns are misplaced, and we address each of them in this note.