Jim Sinclair on jr. exploreco'sPersonal integrity and the ability to communicate the company’s message to shareholders and the marketplace round out the critical attributes that one should look for in public company management.
www.jsmineset.com
Posted: Apr 25 2009 By: David Duval Post Edited: April 25, 2009 at 7:52 pm
Filed under: David Duval
Dear CIGAs,
Evaluating the merits and future prospects for a junior exploration company is a highly subjective process. Intangibles such as political risk, financial risk, market risk, commodity risk, technical risk and a host of other variables confront companies across the entire minerals industry spectrum. Nonetheless, no matter what the relative size of the company or the commodities segment it’s actively involved in, the best place to start your evaluation is with management.
This is especially true for junior gold explorers, the segment of the minerals industry that accounts for the largest proportion of global exploration expenditures and, predictably, the vast majority of new gold discoveries.
Management: Do the Litmus Test
It shouldn’t come as any surprise that good management can spell the difference between success and failure. So how does one determine if management is good or bad?
Also, one should keep in mind that a company can be a success in the marketplace without taking a project to commercial production. In fact, the majority of mineral explorers never achieve such a distinction, selling out instead to an operating company with production expertise, perhaps retaining a royalty in future production.