Interesting comment by Eric in the "Gold Investment Letter"
What is Wrong with Zenyatta?!? Inbox x Gold Investment Letter eric@investormediainc.com via aweber.com Dec. 2 Good Afternoon, After a very brief bump on news today Zenyatta ventures has been hammered. Clearly, there are many nervous investors in the mining sector these days and the 'sell on news' phenomena doesn't surprise me but the severity certainly has! The bottom line is that the ZEN story is better today than it has ever been with the 43-101 resource estimate out. Granted, this is a "maiden" resource that will only grow. But, 977,000 tonnes of finished product is nearly $9-10 BILLION in finished product folks. If they produce this at a cost anywhere near $1k per tonne....or even $2k....or $3k....and sell it for $8500, we're talking about exorbitant profits for decades. I can't help myself, I have added to my position today. It may take a little time but this investor holding profile needs to change from retail to institutional and I believe the 43-101 is just what was needed to Start that process. Panic selling is occurring today and it is very typically a good buying opportunity. There's too much fundamental value here to justify abandoning the stock at this time. No one wants to catch a falling knife so more cautious investors should wait for a bottom to cement and selling to subside. However, we're now down to a $115MM market cap for a company that at production time will be looking at hundreds of millions per year in cash flow based on the economics we know exist. There is nothing wrong with the details of the resource estimate in my opinion. This is going to be an extraordinarily profitable mine in the future but the volatility in this stock will likely continue. I am buying more shares of Zenyatta for my investment portfolio.....my time horizon is not next week in terms of expected profit taking. I believe there is a lot more to come on this story..... Best, Eric