Stockhouse Ticker Trax is published to subscribers every Monday (annual cost only $99). We focus on best-in-class high growth small companies trading on the TSX and TSX.V between 5 cents and $3 with a market cap below $300 million.
Equity Analyst Danny Deadlock has 30 years of experience speculating on Canadian penny stocks and targets capital gain opportunities and diversification in metals and minerals exploration, energy, and technology.
For the experienced investor, Ticker Trax provides an extra set of eyes and ears (idea generation) and for those learning to invest in micro cap stocks, we provide stock picks and market education.
Subscribers receive; (1) new research (stock picks) weeks in advance of being featured on this weekend column (2) exclusive access to our list of junior gold exploration companies (critical for peer valuation), (3) exclusive access to our list of Cash Rich micro cap companies (our Virtual Vulture Fund) which contains 80 companies with almost $3 Billion.
Both tables are updated monthly.
Early July we experienced a capitulation (bottom) in the junior gold stocks. Now that the price of gold is back above $1350, several of the higher quality junior gold stocks are beginning to clean up very nicely on good volume.
Ignoring gains elsewhere I personally have three gold picks that are up almost 50% on average since the first part of July. The smaller producers like Perseus Mining Ltd. (TSX: T.PRU, Stock Forum) (73 cents) have gained 50% just in the past week alone.
I first noticed this sector strength a few weeks ago but then it stalled. Wednesday was the first sign of broad based strength I have seen in the sector since July 21st. Now the question is whether it holds and begins to attract more sector speculators.
NUGT (NYSE: NUGT, Stock Forum)is a gold ETF that holds the mid and large cap gold producers. July 10th the stock fell through $5 but then recovered 60% in the following two weeks. It fell hard again during the first week of August but has gained 95% the past week. The traders are obviously loving the volatility but the renewed interest is very good news for our junior gold stocks.
The gold companies with poor balance sheets and unproven resources will likely continue to struggle as money will first flow to small producers and then higher quality exploration with cash and proven economic reserves.
One junior exploration company that fits that criteria is Clifton Star Resources Inc. (TSX: V.CFO, Stock Forum) (28 cents). I featured that company in this weekend column on July 26th and while it has cleaned up 17% this week, it is still very attractive. Some of you may wish to take a closer look while it still has sellers in the 0.20’s.
This past month someone started dumping Clifton paper (almost a million shares) through Haywood Securities and Anonymous. This has created opportunity for new investors in the low and mid 0.20’s but if this sector strength continues into September, I doubt we will see much stock available in the 0.20’s as CFO traded closer to a dollar in Q1/13.
My original July report is available here:
https://stockhouse.com/opinion/ticker-trax/insights/2013/07/26/24-cent-cfo-valued-near-$1-20-per-gold-ounce-stock
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Disclosure: Danny Deadlock owns 40,000 shares of Clifton Star (TSX: V.CFO).
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