**This article was delivered to Ticker Trax subscribers Tuesday February 16.
We sat a spell in Vancouver, Canada, with Thom Calandra, investor and writer. Thom is the journalist who started CBS MarketWatch and MarketWatch.com – now part of the Dow Jones-News Corp. family. Thom (by the way, folks -- as friendly and helpful as ever – some five years post-MarketWatch), and his California family of four profited handsomely from the $518 million sale of MarketWatch to Dow Jones in 2005. After writing and completing his novel PABLO BY NUMBERS, Thom started the Ticker Trax investment report. Thom’s Ticker Trax juggernaut is now a service of natural resources center Stockhouse.com.
In its 16th month, 11 of the non-stop research report’s 12 Planetary Prospects have risen steadily; in some cases, the gains have been parabolic. Eleven of the 12 Planetary Prospects are natural resources investments: gold, silver, molybdenum, copper and platinum. Dr. Allen Alper peppered Thom Calandra with queries. (Thom and his Stockhouse editing team revised this material today, Feb. 16, 2010 – and released it to Thom’s legion of Ticker Trax subscribers.)
Allen Alper: “Give us the lead here, if you would, Thom.”
Thom Calandra: “Al, most everything looks expensive right now – February 2010. I am just back from Colombia and Panama, where I ran into two high-risk propositions. I’m headed back there in a week or so to see some crazy-high gold grades in Colombia’s Bolivar Department. On the silly-cheap end of things, merchant banks that service gold, copper, silver, oil and potash companies are where it is at. Endeavour Financial (TSX: T.EDV, Stock Forum) just had a $22 million quarterly profit and sells below the net asset value of its held securities and retained cash. That is typical at this point in the resources cycle. In one to two years, that merchant bank, which is a Ticker Trax Planetary Prospect, and at least one other will sell for an 80 percent or greater premium. I am purchasing more of Neil Woodyer’s Endeavour right now.”
Allen Alper: “I saw you scooped all of the Colombian newspapers the other day on the mining M&A there. Wottup, Thom?”
Thom: “Oh, I have been going back and forth to Colombia for a few years now and I seem to recall I lived there briefly a long time ago, before I needed cosmetic surgery that is. Really, any writer or researcher who has been following El Marmato, Frontino, Zancudo and some of the other historic mines in that beautiful country easily would have been first with the news. I just was there. Medoro Resources (TSX: V.MRS, Stock Forum), which I own personally, has become a kind of empanada-gauge of all that is possible in Colombia when it comes to gold and building the next Colombian (mas major, por favor!) major. The country, sheesh, used to be the largest gold producer in all of Latin America – until blood and greed and white powder and guns spoiled everything.”
Colombia's hidden potential
Thom has been spending most of his research time looking at mining and prospecting camps in Colombia, Ghana, South Africa and Panama. “Put me down for everything Colombian, Allen. I'm trying to understand exactly why this place, this country of is it 50 million people with their samba and their aguardiente and their empanadas, why at this precise moment it has become golden. Colombia is right up there with Ghana and West Africa in what I call the sweepstakes for the next Mongolia -- gold, copper, maybe moly, definitely oil and of course, coal.“
Allen: “Que mas, Tomas?”
Thom: "Dr. Al, I think the past 12 or so months -- 2009 -- kind of confirmed after 10 years the world’s appetite for anything that is a hard asset. Not just gold and silver, but copper, real estate, oil. Crops, cattle even. Look at what Serafino Iacono down there in Bogota did with Pacific Rubiales (TSX: T.PRE, Stock Forum), the oil prospector. Shazzam! Less than two or so years and it becomes a 100,000-barrel producer. The market worth of Rubiales goes up like 40-times, maybe more, in the blink of an eye. Mr. Iacono and his team have worked Colombia for so long, at least since the very early 1990s, that they have almost carte-blanche in political and banking circles. That’s why Medoro probably will go nuts here as it assembles these gold-dusted existing mines in Antioquia and Caldas departments. Now that Medoro is well on its way to consolidating El Marmato, which I admit needs to clean up its act in terms of wildcat miners, landslides, displaced residents, and an absolutely poisoned River Calca, (and that is all upside as Medoro’s Vicente Mendoza, the VP of Exploration, and its Colombian President of Operations, Juan Manuel Pelaez, and the lawyer in Toronto who oversees the mix, John Hick, kick some geologic and administrative butt), well, now that Medoro is notching its internal goals, it looks like Mr. Iacono is on his way to another mash-up of gold and copper properties.”
Dr. Alper switches to an article format at this point:
Thom Calandra tells Metals News that he gives prime attention to Colombian Mines Corporation (TSX: V.CMJ, Stock Forum), which he credits for going to $1.06 per share from about 15 cents Canadian in the past five-and-a-half months or so. CMJ President Bob Carrington and CEO Nate Tewalt, both geologists, control in one way or another about 300,000 hectares in Colombia. Some of the properties are secured minerals rights, and Thom says there are a variety of other formats on ownership for CMJ – options on properties, agreements with property owners and so on. Thom sees the CMJ portfolio as prime prospecting real estate. “This is now a $20 million company. As we have been reporting, Colombian Mines and Mr. Iacono’s new group, which just bought the old Zancudo Mine at Titiribi in Antioquia Deparment, are in discussions on a partnership or merger. I am doing everything I can to “broker” that combination. Put that package of properties into the hands of Serafino, along with the three or four mines he has purchased in the past week, and we might see the next Pacific Rubiales miracle – only across the landscape of gold and copper. This is in the interest of our Ticker Trax audience, and I will do everything I can to see it happen. I am friendly with both CMJ’s team and Mr. Iacono’s team.”
Thom Calandra points out that as with each of the 12 Planetary Prospects, he and his family are owners of the shares. Thom identifies Planetary Prospects for those of his service’s audience who are willing to hold for at least two years, and more. With one exception, BioCryst Pharmaceuticals (NASDAQ: BCRX, Stock Forum), which he owned before recommending it to readers, Thom only purchases shares after several Ticker Trax missives to subscribers. In the case of CMJ, for instance, Thom owns shares at about 90 cents Canadian after naming the prospector a Planetary Prospect at approximately 60 cents. His coverage of the company began when CMJ shares were about 20 cents.)
On a speculative note, Thom points out the potential of tiny Bellhaven Copper & Gold (TSX: V.BHV, Stock Forum). Thom just tramped Bellhaven’s properties at Gomez Plata in Antioquia and at San Lucas and elsewhere in Bolivar Department, Colombia. Thom also just saw the company’s copper prospects in Panama. He has not named Patrick Abraham and Julio Benedetti’s firm as a Planetary Prospect and has yet to purchase shares.”It is another silly-cheap prospector that I like in that this is what Julio is calling the artisanal model – follow the illegal miners to the gold, then get them legal and in the Bellhaven fold. Does that rhyme?”
Thom sees Bellhaven, a $10 million company, as a possible 300 percent gainer in the next three weeks or so … yet concedes he must revisit several properties in Bolivar Department, with the help of a helicopter and crash helmet … before deciding whether to go the Planetary Prospect route. That will come in 10 days or fewer, he says about the chopper hopper. (See photo below by Thom of moo-cow at entrance to a Gomez Plata mine.)
Prospecting in Peru: What's hot?
"I had a great trip down to Peru," Calandra says, "where I saw Focus Ventures (TSX: V.FCV, Stock Forum), and met some of Joanne Freeze's Candente Copper (TSX: T.DNT, Stock Forum) folks - Candente Copper and now Candente Gold, the new spinoff in Mexico.”
Calandra thinks the prospects are good for both Focus Ventures' gold mine in the Cordillera as well as Fortuna Silver (TSX: T.FVI, Stock Forum) and its Mexico and Peru silver and polymetallic mines. They are sister companies under the Goldgroup umbrella of Vancouver, Canada. Fortuna is a steady and gaining producer with good potential.
Calandra's crystal pistol: What does he see?
When asked how he sees things playing out in the market this year, Thom backed away a bit, saying that he is "terrible at the big picture", preferring his skills at evaluating specific areas.
"I'm a big believer that any currency is at risk of seeing its integrity get degraded because of debt. I just really believe it's time to be in hard assets. I don't pretend to know how long this cycle is going to last but I hope it lasts another five to ten years." Calandra continued, "I'm a big believer in owning actual gold and silver. I think copper could become a terrific way of owning a very widely traded commodity that substitutes for other currencies, and I'm a big believer in one or two other metals as well. Central Fund (TSX: T.CEF.A, Stock Forum) has been terrific for our audience."
When we asked about the basic criteria Calandra uses at Ticker Trax to evaluate companies, he told us that persistence is the key to getting his attention, noting that he rarely even admits to knowing a company exists until he has been approached by them at least five times.
"I like to quote a friend in Colombia who tells me, 'I don't know how to make empanadas, but I know where to find the good ones'. I'm not a geologist nor am I a metallurgist. I'm a person who has been a researcher and a writer his whole life. I worked hard at MarketWatch and I think I deserve credit for the concept of creating a free box for ordinary investors. I helped USA Today do it years ago with its online service. I paid my dues at Bloomberg and a metric ton of newspapers. But you know, I got a little too caught up in the Internet moment and in my influence on natural resources companies, for sure during the latter half of 2003. I paid the price, an SEC settlement, for not letting my jets cool, and I thank the regulator for the wake-up call. I never meant to do anything that crossed the line, but I think I went just a little bit too fast for the taste of some. I learned A LOT about proper disclosure in terms of legalities, and these days, with age now that I am in my early 50s, I purchase as cheaply as I can AFTER my subscriber audience gets the heads-up. And I hold. And hold. And hold. I intend to be known as the fellow out there who got lost in the Andes or in the thick of the Ghana or Burkina Faso jungle … and forgot to sell at the top.”
Thom continues, “I try to use a lot of people in my network - that goes back 28 years and they more or less tell me ‘no’ on 70% of it all. So if you pass the bell-bell test of the geologists that I rely on, then I will move on to the next step."
Thom Calandra tends to keep his world small these days, with a dozen or so companies that he can keep his eye on carefully. He doesn’t have a support staff to manage anything larger than that at this time. While the demand may be there to seek out more companies, he says he has reason enough to keep it small and manageable.
"I can't really afford to go that much larger, because if I do my family - including my wife - would … well, really … let’s be realistic … she would … kill me." he said.
Calandra told us that he sees copper as being the most liquid proxy for the global economy because it is so widely traded. He definitely has his sights set on moly; calling it the cheap specialty metal right now and saying that we will likely see the demand increase quickly as it begins to be integrated into new technologies. Avanti Mining is a Planetary Prospect (TSX: V.AVT, Stock Forum). Moly futures start trading soon in London, he says.
Gold is probably the one thing worth its salt here for the next 5 years, he says. "At some point we might not even be able to calculate what gold and silver are worth because the paper will be worth so little and the actual metal will be worth so much."
In Africa, he is heads-over heels into Xtra Gold Resources(OTC: BB: XTGR, Stock Forum). “Jimmy Longshore has a decent shot at becoming the next RMF,” he says, referring to tycoon Robert M. Friedland. “The Kibi Gold Belt that Xtra is mapping has as much potential as the Esaase District in Ghana, where Dan McCoy’s Keegan is.
Finally: “West Africa is potent right now. I think Endeavour’s transformation of Etruscan Resources (TSX: T.EET, Stock Forum) in Mali and Burkina Faso is top of the mark. Endeavour Financial just named Sally Eyre as the CEO. Along with Serafino Iacono, Dr. Sally, as I like to call her, had as much to do with the success of Pacific Rubiales as anyone. I see a few other things in Africa with wheels that have yet to get lubed. Look at Wits Gold (OTO: WIWTY, Stock Forum). I just spent 38 hours looking at EVERYTHING Adam Fleming’s and Marc Watchorn’s Wits Gold owns across the ENTIRE basin. I think if they get to the point of bankable feasibilities for one or two of the main Wits Basin sites. Oh my gosh, forget it. Or maybe I should say, Wit-it, wit-it.”
Let’s not forget platinum either, Thom says. Platinum Group Metals (AMEX: PLG, Stock Forum); (TSX: T.PTM, Stock Forum) is one that Thom just toured on the Bushveld Complex in South Africa. Thom says he gave his free and subscriber audience heads-ups about the closure of title issues and other event-triggers that will send R. Michael Jones’s platinum prospect into actual production in the next 18 months or so. Thom says he now owns that one but has yet to name it a Planetary Prospect. He does not own Wits Gold but might after he completes researching and debriefing his notebook. (Also on the South Africa gig two weeks ago was Great Basin Gold’s (TSX: T.GBG, Stock Forum) Burnstone Mine. GBG is a Planetary Prospect, and Thom says Ferdi Dippenaar’s Great Basin might be one of that nation’s freshest socially responsible miners with profit and patience both at the head of their corporate charter.)
- Allen Alper with editing help by Thom Calandra and team
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HOLDINGS:Thom’s stock holdings are listed for all Stockhouse members on www.Stockhouse.com under the “portfolio setting” for user TCALANDRA. It is public and free to view. He also owns recently minted gold and silver coins and shares of two private companies, one of them a nickel and platinum prospector in South Africa & DRC (Congo) operated by Robert M. Friedland. Thom does not do private placements – with the one exception this yea, he hopes, of Titiribi-Sunward in Colombia … nor does Thom accept payment in return for coverage. Thom participates in select company-sponsored and company-paid tours of mining sites after examining the properties off-site for many months and in some cases, years.
THOM CALANDRA of Ticker Traxhelps his audience find value in a quagmire of investment choices. Thom co-founded and was executive VP of news for CBS MarketWatch andMarketWatch.com. As the voice of Thom Calandra's StockWatch and The Calandra Report, Thom pegged $300-ounce gold as a long-term hold and dyed his hair blonde multiple times as gold surpassed $400, $500 and $600.
Ticker Trax™ is published by Stockhouse Publishing Ltd. Ticker Trax is an information service for subscribers and neither Stockhouse nor Thom Calandra is a broker or an investment advisor. None of the information contained therein constitutes a recommendation by Mr. Calandra or Stockhouse that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. Ticker Trax does not purport to tell or suggest the investment securities subscribers or readers should buy or sell for themselves. Subscribers and readers of Ticker Trax should conduct their own research and due diligence and obtain professional advice before making any investment decisions. Ticker Trax will not be liable for any loss or damage caused by a reader’s reliance on information obtained in the reports. Subscribers and readers are solely responsible for their own investment decisions. Opinions expressed in Ticker Trax are based on sources believed to be reliable and are written in good faith, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness. All information contained in Ticker Trax should be independently verified. The editor and publisher are not responsible for errors or omissions or responsible for keeping information up to date or for correcting any past information. Ticker Trax does not receive compensation of any kind from any companies that may be mentioned in the report. Any opinions expressed are subject to change without notice. Owners, employees and writers may hold positions in the securities that are discussed in Ticker Trax. PLEASE DO NOT EMAIL THOM SEEKING PERSONALIZED INVESTMENT ADVICE, WHICH HE CANNOT PROVIDE. Copyright 2010 all rights reserved.