RE:RE:RE:RE:RE:Hillis Payout....GROTESQUE Checkmate28,
When it comes to marketing silver stocks, I think that CEO Bradford Cooke stands head and shoulders above all over CEO;'s with the possible exception of Rob McEwen. However, while I am impressed by Endeavour Silver's web site and marketing efforts, which no doubt, have held up EXK's stock price up to its current lofty valuation at $2.27 USD on the NYSE and $2.98 loonies on the TSX, when I compare Endeavour Silver's 4 operating mines to Orvana's El Valle Boinas Carles mine, I get a totally different picture.
Let's compare the 2018 Measured and Indicated Resources of Endeavour Silver's 4 operating mines: Guanacevi, Bolanitos, El Cubo, and El Compass:
The combined M&I resource is 2,117 kt of 1.43 g/t gold and 219.9 g/t silver for a total of 97.445 ounces of gold and 14.97 million ounces of silver or a total of 297,000 ounces of gold equivalent.
In contrast, per Orvana's 2018 AIF, the current M&I Resource at EVBC in Spain stands at 7,541 kt grading 3.92 g/t gold, 13.35 g/t silver, and 0.63 percent copper. Neglecting Orvana's 3.2 million ounces of silver and 47,500 metric tons of copper, Orvana's 951,000 ounces of gold is three times larger than Endeavour Silver's resources at its operating mines.
If you want to throw in Terronera which will cost at least $50 million to build that project takes EXK's resources up to 471,000 ounces gold equivalent or about half of El Valle alone.
So do I want to be invested in a company with crappy marketing, overpaid executives, but with a superior high grade gold mine and high productivity per employee, or do I put
my money in with a slick marketer who has high cost mines, and needs a much larger exploration budget to keep his 4 mines running, and who has a history of printing
shares whenever he needs the money, and has 4 inferior silver mines?
Both companies generate around $35 million USD per quarter in revenue and ORVMF stock currently goes for 13 cents US per share, and you have to pony up $2.27 USD to own a share of Endeavour Silver. The value proposition is a slam dunk in favor of Orvana!
Endeavour Silver has 128 million shares in its float, and back in 2013, the stock float was 99.7 million shares so existing shareholders from 2013 have experienced a 28 percent
dilution factor. In contrast, Orvana has the same 136 million share float today that it had back in 2013.
EXK shares sold for $8 USD per share at the beginning of 2013, so your investment in EXK would be worth 28 percent of its original value today.
ORVMF shares sold for 90 cents at the beginning of 2013, and so the shares are trading at 15 percent of its original value today.
True, Endeavour Silver shares have held more of their premium than Orvana's, and true, Endeavour Silver's growth plans are more ambitious than Orvana's, but that it because Brad is running short on resources at his existing mines, and really needs Terronera to go into production ASAP to maintain his existing gold and silver production rate. So in that way EXK is where Orvana was back in 2012 needing to spend $50 million USD to get EVBC up and running. Orvana paid off that $50 million in debt in 2014, and has invested in a CIL and tailings dam expansion in Don Mario, and in extensive underground development and exploration at EVBC.
So with ORV, you get a low risk stock with none of the dilution risk, or the execution risk associated with bringing new mines into production. Orvana is off life support, and likely to make a profit this quarter, and the drag from CAPEX will be down this year, so it is a boring low risk stock that is severely underpriced.
That is the kind of stock that I like--boring, low risk, and undervalued!