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Buzz on the Bullboards: Metals & Mining in Focus


Stockhouse Editorial
1 Comment| January 24, 2019


VRIC 2019 is now over. Thousands of investors once again descended upon the Vancouver Convention Centre West for two days (January 20th and 21st) to do due diligence on their favorite mining companies and gain insights from the dozens of high-profile speakers who gave presentations on a multitude of investment related themes.

With metals & mining front-and-center at the moment, this edition of Buzz will focus on the mining companies that are currently of greatest interest to the Stockhouse Community – as reflected by their total Bullboard reads. But before we get into individual stocks, let’s preface this with the results from our latest Stockhouse Investor Pulse Poll.

We asked you to tell us where you are most interested in investing your mining dollars in 2019.

Click to enlarge

Stockhouse is well-known for having a strong Community of gold (and precious metals) investors. With markets wobbly – to say the least – it won’t be a big surprise to experienced mining investors to see precious metals rising in prominence.

Interest in gold led the way (27% of respondents), but silver also has robust interest (18%) among Stockhouse’s mining investors. Combined, that’s nearly 1 in 2 Stockhouse mining investors who are indicating that their current mining focus is precious metals.

Other conventional metals like copper (12%) and nickel (12%) also have strong support. Understanding why experienced mining investors are interested in these two base metals markets requires nothing more than looking at a chart of falling inventories.

Click to enlarge

Click to enlarge

[charts courtesy of InfoMine.com]

While these metals have numerous/major conventional applications, both nickel and copper are seeing increasing demand from new and hi-tech industrial applications. Nickel benefits directly as an increasingly important component in lithium-ion batteries (used in the cathodes).

Copper, however, is also seeing increasing demand from the Electrical Vehicle Revolution. EV’s (not surprisingly) require vastly more copper wiring than fossil fuel-powered vehicles. With prices for copper and nickel not keeping pace with this rising demand, both these markets appear headed for near-term spikes in price.

Naturally, significant numbers of mining investors (14%) are keenly interested in what are more commonly called Battery Metals (and minerals): lithium, graphite, manganese, and others. We excluded cobalt and vanadium from voting because these metals have already seen massive run-ups.

Another 1 in 7 readers (14%) selected “other metal/mineral”, so it’s impossible to say where the specific interest is here. However, from aluminum to zinc, there are numerous other metals markets that could also have big years as 2019 unfolds.

Now let’s talk companies. Here are the Top-10 most popular mining stocks at Stockhouse, through the first three weeks of the New Year.

Click to enlarge

Given what has already been discussed, it’s not surprising to see this list dominated by gold mining companies. Half of the ten most-popular mining companies specialize in gold. So where are the silver mining companies on this list – given that Stockhouse investors are bullish on the commodity itself?

The short answer is that there are very few primary silver mining companies in the world today. This is the consequence of decades of radically under-pricing silver. In real dollars, the price of silver is not far from a 600-year low in price.

This under-pricing has decimated the global silver mining industry. Today, only the richest silver deposits (and best-run companies) are able to stay in operation at such radical under-pricing. But with the silver market having been in a 30-year supply deficit (that has devoured more than one billion ounces of stockpiled silver), this is a market that must be revalued higher – to many multiples of the current price.

The longer that silver remains irrationally under-priced (and in a supply deficit), the more explosive the response will be when this market finally rebalances. With silver solidly on the radar of Stockhouse investors, this suggests that readers need to invest more time (and due diligence) learning about these rare mining companies. Now back to the Top-10.

Leading the way among mining companies at Stockhouse is RNC Minerals (officially Royal Nickel Corp. TSX: RNX, OTCQB: RNKLF, Forum). RNX rapidly built a strong following at Stockhouse in 2018 after a significant gold discovery at its Beta Hunt Mine in Western Australia.

BuzzJan24_RNX1year.jpg

(click to enlarge)

After giving back much of its gains from 2018, the stock has surged again in recent days on some spectacular drilling numbers, along with news that RNC Minerals is busy “extending resources” at Beta Hunt. RNX has consistently been near or at the top of our Metals & Mining leaderboard since making its discovery.

Another gold mining company with a strong hub at Stockhouse is Harte Gold Corp. (TSX: HRT, OTCQB: HRTFF, Forum). HRT recently announced that commercial production has been achieved at its Sugar Zone Mine. With a new gold resource and NI 43-101 Feasibility Study also due for release in Q1 2019, mining investors may see this an attractive window for Harte.

In the #3 position is Pretium Resources Inc (TSX: PVG, NYSE: PVG, Forum). PVG’s huge, high grade Brucejack Gold Mine produced 376,012 ounces in 2018, a hair off its full-year guidance. In December, Pretium announced that it has received the necessary permitting to increase its throughput to 3,800 tpd’s. More recently, PVG announced repurchasing its gold/silver stream and it has closed its previously announced US$480 million debt facility.

BuzzJan24_PVG1yr.jpg

(click to enlarge)

This one-year chart has been zig-zagging erratically. The recent trough in share price – despite supportive news – may look like a particularly attractive entry point for investors interested in Pretium.

In the #4 slot is not another gold mining company. Largo Resources Ltd. (TSX: LGO, OTCQB: LGORF, Forum) is an established mining company (market cap >$1 billion) with a focus on vanadium, by far the strongest metals market in 2018. With the supply/demand drivers for vanadium especially strong (due to its energy storage properties), there is no reason for investors to expect the vanadium market to weaken in the foreseeable future.

Katanga Mining Ltd. (TSX: KAT, OTCQB: KATFF, Forum), #5 on our Top-10, has gone through a difficult past year that includes regulatory issues, production restrictions, and investigations on multiple fronts. With KAT’s import/export restrictions lifted and some progress announced on the regulatory front, investors looking for undervalued assets may want to do some further digging here.

The #6 most popular mining company at Stockhouse is Novo Resources Corp. (TSX: V.NVO, OTCQB: NSRPF, Forum). NVO is well-known to most mining investors at Stockhouse since Novo was the runaway Bullboard leader for mining stocks in 2017.

BuzzJan24_NVO3yr.jpg

(click to enlarge)

Novo Resources announced its own big gold discovery, also in Australia, its now-famous “Pilbara discovery”. This is a “glass” that will look half-full to some mining investors, and half-empty to others.

On the one hand, at its current share price of $2.33, NVO is still trading at multiples of where it was trading before its Pilbara discovery. On the other hand, with Novo well off its all-time high near $9, some investors may be leery of ‘catching a falling knife’. Do your own due diligence.

Mining investors who attended VRIC had the opportunity to get up-close-and-personal with the management teams of more than 350 mining companies. That’s a lot of potential investment candidates for investors to research.

For newer mining investors (or simply investors with little time to commit to investing), visiting Stockhouse’s larger mining hubs is not only an opportunity to become more familiar with the companies that are currently most popular with investors. It’s also a chance to network with Canada’s largest community of small-cap investors (more than 1 million “unique” visits in 2018 alone).

However, investing at Stockhouse goes well beyond mining. As always investor conferences dominate the early months of the New Year. Next on tap, the focus switches back to tech. On January 29 and 30, 2019, Toronto is hosting CanTech 2019, a tech-investor conference that has been growing every year since its inception in 2013.

As we look ahead to CanTech, we wanted to get a better idea of what areas of tech are of the greatest interest to the Stockhouse Community. This leads to our upcoming poll.

This week we're asking you:

As CanTech 2019 approaches (January 29th and 30th in Toronto) what facets of the tech sector are of greatest interest to you?

  1. Artificial intelligence
  2. Blockchain
  3. IoT (“Internet of Things”)
  4. Esports/e-gaming
  5. Healthcare technology (including psychedelics and genome editing)

As always, our Investor Pulse Poll is hosted on the Stockhouse homepage. Watch for our upcoming poll -- and share your own thoughts by voting.

Mining or tech? Investors don’t have to choose. There are plenty of great small-cap investment opportunities in both of these sectors. For those investors with a clear preference for technology, the next couple of weeks on Stockhouse should be especially interesting as we cover CanTech and small-cap Canadian technology stocks.



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Comments

ScarlettSmith
Great information There are some other metals & mining penny stocks are also there those are HCH & ALK. I am a investor and following metal and mining asx penny stocks and I found your analysis is very helpful for me to understand the metal and mining stocks.
(0)
June 18, 2019

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