Stock pick of the week, and some news
Stock Pick of the Week:
Piedmont Mining Company, Inc.
Traded Pink Sheets: PIED
Initial Recommendation: 10/11/03 - $0.06
Price 1/27/06: $0.13
Shares outstanding: 43,958,400
Market Capitalization. $5.8 Million
Silver Resource Ounces: 8 Million
Area of Operations: Nevada
Progress Rating: "C"
Tel.: 212-734-9848
Web address: www.piedmontmining.com
Take a look at Piedmont's stock price chart on the left. You will see that
from August 2004 until this past week, Piedmont had traded between about
$0.06 and $0.10 per share. It started drifting towards the upper end of
this range late last year. But since the start of 2006, every time it hit
$0.10 it got whacked back to $0.095, time and time again. As it turns out,
there was reportedly one big shareholder with perhaps 2 million shares of
stock who because of his need for cash, put his entire position on the
market at $0.10 right after the New Year. By the end of last week, the
mounting buying power had consumed that entire position. With that price
ceiling removed, PIED shot through the $0.10 level to $0.15 like a rocket
this past week - and on a huge increase in volume.
As some of the more advanced junior gold stocks have been moving higher, we
now want to look more aggressively at the lower priced gold stock
opportunities like Piedmont that have good projects and strong management
teams. If I held the view that this gold bull market would soon end, I
would not seek to go down the gold stock food chain. Sure, at some point we
could well witness a gut-wrenching pullback in the price of the yellow
metal that might shake all but the hardiest of us veterans. But when I
spoke with Ian Gordon last week he said, "Jay you ought to be really happy
now because this is the greatest gold bull market of a lifetime." Well I
am old enough to remember what it was like in the last great bull market in
gold when the Dow/Gold ratio approached 1:1. It was indeed exciting because
as Howard Ruff said back then, "When the wind blows, even the turkeys can
fly."
Turkeys may fly, but we are not interested in turkeys because turkeys are
not known for long, sustainable flight paths. Instead, we want companies
that rise, not on gusty wind currents, but based on their intrinsic merit.
In addition to its stellar management team, PIED has several properties
with considerable promise, each of which has passed management's strict
"smell test" before they were acquired:
For example, the Trinity Silver Project, located in Pershing County, Nevada
already contains a resource of some 8 million ounces of silver from past
drilling and exploration work. Upon receipt of some additional funding,
management plans to obtain an updated compilation of the silver resources
on this property from the previous drilling and engineering data already
available.
The Antelope Ridge Silver/Gold Property, is located in the southern part of
the Battle Mountain Trend south and east of Eureka, Nevada. It is just west
of a recent new gold discovery by Staccato Gold south of Eureka. Numerous
surface samples from the jasperoid outcrops on the property have returned
assays of multiple ounces of silver per ton.
At the Dome-HiHo Gold Project, located in Lander County, Nevada in the
northern part of the Battle Mountain Trend and within a few miles of a
number of well known gold deposits on the trend, rock samples from the
property have assayed up to 23 grams of gold per tonne.
On the Bullion Mountain Gold Project, Eight vertical holes were drilled by
ASARCO on the property in 1989, reporting intersections of 20 ft. grading
0.023 ounces of gold per ton; 10 ft. grading 0.204 ounces of gold per ton
and several other 10 ft. intersections grading in excess of 0.01 ounces of
gold per ton. This property is only a few miles from the famous Pipeline
gold deposit.
In each case, gold and/or silver mineralization is present on these
properties, and the geologic environment and proximity to other noted
deposits suggests the potential is there for outlining some significant
new mineralization. As you may be aware, these gold trends in Nevada are
favorites amongst the gold exploration community and they have recently
been highlighted by Rob McEwen of Goldcorp fame who has received
considerable notoriety lately for his investments in a half dozen junior
exploration companies with properties in Nevada near and on the same
mineralized belts as Piedmont's. Furthermore, last month Staccato Gold
announced what appears to be an important new gold discovery south of
Eureka and Barrick's Archimedes gold deposit and just east of Piedmont's
Antelope Ridge property. I anticipate that PIED may soon raise some
serious capital to be used to commence exploration work on their
properties. If this bull market in gold keeps steamrolling along, and if
Piedmont comes up with some good assay numbers on any one of their
properties, this stock is extremely cheap. I look for PIED to rocket to
much higher levels in the near future, particularly now that much of the
cheap stock in weak hands has been worked through.
While I anticipate that significant funding should be forthcoming within
the next month or so, anyone interested in a small private placement
opportunity at this time should contact CEO Robert Shields at 212-734-9848.