great jaguar commentary from kereport We’re seeing the same thing in Jaguar mining right now where investors are in a huff and puff, over the most recent operational results, but aren’t looking at the trajectory of where things are headed now with the huge $25 Million capital raise and what that allowed them to do. They’ve retired old debt, and this allows them to remove their hedges for next year, and got new equipment, and invested into to both their major mining complexes. (JAG) projected to be able to producer 100,000 ounces next year, and while they’ve missed that target in 2018 and 2019, I believe they’ve got their ducks in a row to hit 100,000 ounces next year and it will likely be a much higher gold price and their costs will be coming down. When others see recent pain, I’m seeing future gains.
Cheers and good luck to everyone as they scalp deals over the next few weeks in Tax Loss Selling season. Tis the season!
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On November 27, 2019 at 11:03 am,
Matthew says:
Jag is one company that really benefited from Sprott’s interest since it really needed the investment. The dilution is a bummer but not when compared to the problem that the new cash solved. It still has great potential and the downside now seems small when compared to the upside but it won’t move up as easily as it did in 2016.
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On November 27, 2019 at 11:17 am,
Excelsior says:
Agreed. I’d settle for 5-6 bagger from here, instead of shooting for 9-10 bagger.
Also at one point (once the shares are in a rising price environment) a share rollback will help attract larger funds to the story. Most won’t touch stocks under $3-$4.
On November 27, 2019 at 12:00 pm,
Matthew says:
The wild card is the gold price. Jag is highly levered to gold so a 10 or even 20 bagger wouldn’t surprise me if gold performs decently. Net income was $1.1M on 19,000+ ounces at $1320 per ounce so a $1620 per ounce average would send net income up a theoretical 5-fold+ to $5.7M per quarter. If Jag delivers on the 100,000/year goal, net income would rise to $7.5M/quarter. The actual number will probably be very different and possibly better (if AISC come down).
P/Es of 30 or 40 or even more are not uncommon in this sector so $30M/year could translate to a market cap of $1B+ pretty easily (current MCAP is about $100M cdn). That’s by no means a “take it to the bank” projection but IS quite possible and that’s with gold at just $1620, average.
Mining is always risky business so plenty could go wrong, as almost everyone here knows.
On November 27, 2019 at 12:21 pm,
Excelsior says:
That was a good walk through where things could potentially go if gold prices rise into the mid $1600s, and their costs come down, and their hedges are removed, and they hit the 100,000 ounce per year guidance. I’d love see them move up to a $1 Billion market cap over the next 2 years.
Until then… cheers!
On November 27, 2019 at 12:27 pm,
Matthew says:
Cheers senor (not senior )
On November 27, 2019 at 3:34 pm,
Excelsior says:
Ole’ !
On November 27, 2019 at 10:29 am,
Wolfster says:
Like Jag not meeting past production guidance and getting sold off based on past and maybe present shortfalls rather than looking forward, I think USA could be added to that last
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On November 27, 2019 at 10:55 am,
Excelsior says:
Agreed Wolfster. I remember when JAG was $6 stock in the last cycle. I was in it heavy in 2010 and 2011 and overstayed my welcome in 2012, so it is seared into my investing memory. I watched and waited for it come out of credit restructuring and figured it was gone for good. However, when they emerged with all their mines and properties I started following more closely waiting for a chance to pounce on the re-rating.
There have been a few good trades in JAG, but is still undervalued compared to peer producers that are doing 80,000 – 100,000 ounces per year. Last year when that fund sold out of their position it really tanked and didn’t recover back to where it was before that, but things have been gradually improving over time. JAG should surprise folks in 2020.
As for USA – yes agreed. I remember when folks hated Scorpio Mining and then doubted the merger with US Silver and Gold to form Amercias Silver would amount to much. Then in early 2016 to that summer it took off like a scalded cat for a 9 bagger. Even after that I still felt it is nowhere close to where it should be based on the assets they had in the ground, and it has steadily crept higher and held onto gains in a tough market, but now with their new Gold mine Relief Canyon in Nevade, optimized Silver mining operations in Mexico, and the large cash injection from Eric Sprott in Idaho, they are set to be valued much higher than where they’ve been stuck the last few years.
Good examples Wolfster.
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On November 27, 2019 at 11:35 am,
Excelsior says:
Another company that is