New Found Gold Corp V.NFG

NFG vs. SGD

[AlwaysLong683]

Lots of noise re. SGD in recent weeks.

 

Here’s my take to date:

 

 

Current Market Caps (source: TMX Money):

 

SGD:   393M

 

NFG:   793M

 

 

Zones:

 

SGD has hit one very impressive zone so far (Valley discovery at the Rogue package).

 

The only other zone they’ve done any real work on is Jupiter (Einarson package) and the results are hardly anything to get excited about to date in my view.

 

All of SGD’s other scattered land packages (reminds me of NFLD) are anyone’s guess. The only thing we know so far is it will cost a small fortune to drill and assay these remote, disjointed land areas without knowing what if anything impressive will turn up. As I’ve stated in the past re. NFLD and SIC, the more disjointed claims packages you stake, the more expensive it gets to drill and assay all these areas, and if you come up empty at any given package, that’s money down the drain.

 

Conversely, NFG has hit monster cores in three different zones (Keats, Lotto, Golden Joint). Further, the enormous, contiguous, Queensway land package in an excellent, accessible location will be much easier to undertake further exploration as NFG works their way south at Queensway than what SGD will have to deal with as they hop-scotch around various land packages in isolated areas of Eastern Yukon with little infrastructure to speak of.

 

 

Share Structure:

 

Currently, NFG appears to be subject to a lot less potential share dilution than SGD.
 

 

Share price movement:

 

SGD currently reeks of speculators day-trading the shares:

 

Monday September 12:  up over 26% on much higher than normal volume and no news

 

Tuesday September 13: down over 10% also on much higher than normal volume and no news

 

Of course this is insignificant in the long run – the company will eventually be appropriately valued based on numerous applicable factors, but I wouldn’t mistake a big move up or down on no news to be indicative of where the share price should be (or will be in the following day or two or three….).

 

 

Potential Takeout:

 

Hard to see a takeout of either of these companies anytime in the near future by a large North American-based producer:

 

ABX:  CEO Mark Bristow has been insistent he will not overpay for any asset and is not keen on early-stage exploration companies (with GBR provided as an example).

 

AEM: Recently completed their merger with KL, so will likely focus on creating synergies among the now much larger combined portfolio of assets and advancing these mines / projects.

 

NGT: Large global portfolio of both producing mines and projects yet to be built, such as the Coffee Project which which just received approval to proceed by the Federal and Yukon governments in March.

 

K: Purchased GBR and will likely be focusing large amounts of money into further exploratory drilling activity along with a ramp up to feasibility and environmental / permitting endeavours followed by at least one mine build over the next number of years.

 

YRI: Recently taken out by Gold Fields.

 

I suppose it’s possible than a large foreign-based producer like Newcrest (Australia), Anglogold Ashanti (South Africa), or the aforementioned Gold Fields (South Africa) may kick the tires on NFG and/or SGD at some point in the future, but of the two, SGD has the longer slog to put together a large portfolio of assay results to put in the window.

 

Regardless, anyone think SGD is worth approximately half of what NFG is worth as things stand today given the above? 

 

Of course, stories of these two companies have yet to be written, and anything can happen in the high risk, unpredictable world of junior gold exploration-stage companies, but, in my opinion, SGD is the higher-risk company.

 

As always, time will tell…..

 

[Retiredgeo]

They are two very different types of deposits.  Both will become mines.  Size, longevity and the quantity of ozs all favor SGD.  Grade, profitability and quick return on investment favor NFG.  Whom will buy whom depends on the philosophies of the majors.  I will give SGD the advantage in that category.

[wajac]

Always long, thanks for taking the time to put together an excellent summary of the relative strengths of NFG and SGD. As with all early stage exploration companies they are high risk and it's easy to lose your shirt on any of them. Daily attention is required. And there's nothing wrong with taking a profit when the opportunity arises.

[Goldziggy]

The last big takeout in the Yukon for the same type of gold project was Kaminak. They were bought out for a little over 500 Million. It was higher grade than SGD.  My guess is the upside is around there or a little higher depending on how many ounces since its very remote. I dont see a barrick or aem buying that kind of project. looks to be fairly valued or over valued at this point and is

[megacopper]

    Snowline doesn't need another zone. Lol Totally different gold systems so not a very good comparison geologically speaking. Also NFG has over 600 holes drilled and SGD only has a couple dozen with only 7 holes with assays. We all know what NFG has and it is undoubtedly an incredible gold discovery with some of the highest grades of gold you will see anywhere on the

[AlwaysLong683]

You are correct - Valley only has a small handful of assayed holes, and that's one of my points - predicting a 10M or 30M+ resource from such a small amount of hard data is very premature in my view regardless of the type of gold system. I'll repeat what I stated in an earlier post: Is there any reputable geologist other than QH predicting 30M+ ounces at Valley alone this early? If not

[megacopper]

  Will all due respect please read up on the geology of reduced intrusion related gold deposits and you will understand why such predictions can be made. And simple calculations can quickly determine the amount of gold in an intrusion type system unlike the erratic orogenic high grade systems. When someone hits an intersection of 283 meters of 2.3 g/t in an intrusion type system with

[AlwaysLong683]

I actually found a professional geologist with over 15 years of industry experience who recently commented on what he thinks of SGD's discoveries to date (including their 2.3 g/t Au over 283m assay result as revealed in SGD's press release dated August 24, 2022) in an interview dated September 7:   "Obviously more drilling needs to be done to test the merit of the project and

[JohannSebBucc]

This post has been removed in accordance with Community Policy

[Retiredgeo]

There is a big difference between what a company officer can say and what an independant observer will say.  Of course the company officer is going to be more conservative. QH has thrown out a guesstimate based upon assumptions.  His point being "this deposit is going to be huge".  Huge tonnage, low grade deposits usually are.  Some mining companies with 30 year

[AlwaysLong683]

There's also a big difference between stating something like "Given the assay results to date and the type of gold system that appears to be present, I believe the resource will likely be quite large" and "I suspect / think a rough estimate is in the neighbourhood of 34M ounces". 34M ounces would make it one of the largest mining operations in the world. That's way too

[megacopper]

  The CEO and directors of publicly traded companies have to follow regulations with regards to making statements about how much gold they think they have. Basically they can't say what they think, they have to prove it with drill results and that is exactly what SGD and NFG are doing. Both companies will be successful and long term shareholders will be well rewarded. 

[AlwaysLong683]

[JimmDandy]

Define reputable. Jimbo