Jeff Clark Comments on Maple Gold:Below are Jeff's comments that can be found on his twitter page (@TheGoldAdvisor) (I first heard of and invested in Maple through Jeff Clark)
I don't publicly post negative comments about companies. I'm not here to hurt a company or someone's investment, which is why I haven't talked about Maple (and why I'm posting this after market hours).
This week's news about Douay was unfortunately not positive, as the market's reaction yesterday showed. The high-grades we were expecting at depth have not materialized, now the 2nd report demonstrating this (last Nov news). And a big part of me saying Maple would someday be a $2 stock was based on Douay's big potential at depth. I wasn't the only one thinking this, one analyst even projected there were 10Moz across the projects.
Could Douay still be a mine? Perhaps, there is mineralization, but IMO the odds of that just went down. Mngt will disagree with this.
Maple still has the 50/50 partnership with Agnico on Joutel and their 100%-owned Eagle project, so there is still potential for economic discoveries for the company.
This is a major mea culpa for me. I thought Douay would prove to be a high-grade underground mine, but based on the recent news, I have to say I unfortunately agree with the market's reaction. I no longer think this will be a $2 stock.
So, should we sell? The reality is we are so far underwater that it wouldn't make sense to do so. There is still potential at the other projects, and the stock bounced today on big volume, some investors seeing a bargain in what was a 5¢ stock yesterday. And if they and AEM can prove something up at Joutel and/or Eagle, Maple could still be bought out. But not at $2. I would be immensely pleased if I am proven wrong, but unfortunately I just don't see it at this point.
I will hold some shares since there is still upside potential, but in full disclosure I will lighten up on what was an overweight position for me, on days the stock is rising. While there is still potential with the company, IMO it is materially less than what it was. You are welcome to talk to mngt to discuss why I may be wrong.
My thoughts:
as far as we know, there is no fraud going on, their debt is not substantial, they have a lot of cash in the bank, plus additional funding from AEM, and 2.5M oz of gold. I do not see MGM trading much less than the current $30 million MCap. That being said, I think I will be following Jeff’s advice and be selling on “up-days” as there has been too much disappointment and the hype not coming to fruition. My break-even is $0.20 CAD. Hopefully we can get back up there. Best to all who stick with Maple Gold.