RE: RE: Casey Research on Corvus Comments: BUY FIRST TRANCHE—GPA: $1,300. CCS: 0.07. Corvus just released a new preliminary economic assessment, at a more conservative gold price. This dropped the North Bullfrog project's IRR to 23.1%, but more than doubled the NPV. The market doesn't seem to have liked it, and we can understand why, as anything less than 25% IRR is suspect, but we think this is great news, because we don’t think gold will be at $1300 come production time, and we're encouraged that the project still makes money even at gold prices lower than today.
As for the company's ownership, insiders own 16.9%, institutions 20%, and the public 49.7%. Corvus has one of the strongest insider holdings across our portfolio, and with a 2.1% increase over last year, it has become stronger yet. The institutional presence, while somewhat below the average of its native index, is significant as well. AngloGold Ashanti, which in April, 2013 purchased another set of 3,450,000 shares of Corvus’, now holds 13.3% of the stock; we see this as a strategic investment and a vote of confidence. Jeffrey Pontius, CEO, and Quentin Mai, VP of Business Development bought 250,000 and 69,000 of Corvus’ shares respectively at C$0.58–C$0.97. Looks good.
Concern over the Corvus' previous gold price assumption was a major reason for holding back regarding this company, so we're more bullish now that that has cleared up. We'd buy a first tranche if not long already.