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Saturday
Aug122006

Taseko Mines Limited (TGB): Buy This DIP

TGB1

Taseko Mines Limited (TGB) 3rd-quarter earnings fall, the faint hearted sell, presenting us with a great buying opportunity.


Vancouver based mining company Taseko Mines Limited (part of the Hunter Dickinson family) reported earnings of C$4.1 million or 3 Canadian cents a share for the 3rd quarter, down from C$11.6 million for the same period a year earlier.
However, operating profits were up to C$18.3 million from C$12.2 million. Revenue was up to C$59.9 million almost double the pervious figures.

We can understand investors sitting on large profits pulling the pin as these figures are not as good as some of the numbers that we have reported for other companies on this website. However, this does appear to us to be really overdone. Did they all miss the fact that the Gibraltar mine will increase annual production capacity to 100 million pounds of copper by 2008, an increase of almost 50%!

Lets take a look at the chart; we can see the sell off and also the beginnings of a bounce the very next day. Are the same people who sold buying back in or is it the cute investor who has patiently waited for this chance to get into this mining stock at a very reasonable entry price. We don’t know, neither do we care, but for us it is a wonderful opportunity to invest our hard earned cash into this stock.
We had previously recommended Taseko at $2.78 and on Friday it closed at $2.26.

TGBChart2


Our course of action will be to buy again on Monday.

For the purposes of our progress report we will use the original purchase price, as we believe it is only fair to do so.

This next purchase will be regarded as a nice bonus.

(TSX: TKO, AMEX: TGB)

12 August 2006
Friday
Aug112006

Portfolio: General notes

Goldcoin2

Answers to a few general points that come up in your emails regarding our portfolio.

We do not work for any of the gold mining companies that we write about or hold an investment in. In fact we only work for ourselves, investing our own funds into the investment opportunities that we believe will make us handsome profits.

All of our research is free and published on this website.

We have researched many stocks that do not get a mention because we don’t consider them to be amongst the best at that particular time. As and when we feel the time is right we will publish our findings.

We do not have a private newsletter to which you can subscribe for a fee. At the moment we don’t feel that we will take this route as we are happy to generate profits, enjoy those profits and enjoy writing about them, come what may.

We do cover silver and uranium but not on this website, just click on to silver or uranium to be transferred to those investment sites.

We tend to shy away from options trading and the futures market as it may be a vehicle for creating wealth quickly, however, it is also a vehicle that can wipe you out in no time at all. Our progress may be slow as investments need time to mature, but this current bull market in gold will ensure that it is certainly not dull.

Occasionally we suggest a bet, this will more than likely be based around the stocks that we are already have an investment in. But if we have identified a short-term gain regarding gold, then we will tell you what we are doing, why we are buying, how long to hold for and why we are selling.

This site is designed to have fun with your gold related investments not to be full of stress, so don’t risk more of your money than you can afford to lose. Also bear in mind that we not looking for a safe haven to put our money, we are looking for investment vehicles that we think will DOUBLE within 12 months. This strategy therefore carries with it risk, so relax into it and don’t go too mad on any one investment.

Never fall in love with a stock, its hard for us not to I know, but discipline is ever so important.

Keep the comments coming as it adds a little balance to our analysis.


11 August 2006
Friday
Aug112006

The HUI Index: Where next?

We appear to be treading water at the moment, or is it the lull before the storm?

There is an eerie stillness at the moment as the HUI slides sideways constantly teasing her onlookers. I like to put it down to the August vacation period but that seems to be a little simplistic. After all not every nation on the planet goes on vacation at the same time, in fact some countries operate on a totally different calendar to that of the western world.

Looking at the wedge formation that is forming in the chart for both gold prices and the unhedged gold mining HUI index, it looks to us that we are close to a convergence that will result in an upward breakout. Gold as we have just witnessed can move in the opposite direction to what would be normally expected. Whether this is due to the theories that GATA put forward or not, we don’t really know. But we would expect gold to move upwards when we have a terrorist threat unfolding as we do now.

Gold11Aust2006


HUI11August2006


For the moment we are watching the situation while researching other opportunities in this sector. Many gold mining stocks appear attractive but the timing or their particular chart does not scream buy, buy, and buy, to us. So for the time being we are sitting on the fence waiting for the bargains to identify themselves.

11 August 2006
Wednesday
Aug092006

Agnico Eagle Gold Mines Ltd: The Bet!

While helicopter Ben groomed himself for stardom we had a small wager on an upward move for Agnico Eagle based on a rate freeze.

The rational being that the rates would not be changed, the dollar would weaken, gold would rise and Agnico Eagle would rise with it. As we said in yesterdays article, any vehicle could have been chosen and some would have generated more cash than others. However, in the event of getting it wrong we would be left holding Agnico’s stock, which is just fine and dandy with us. We are of the opinion that this stock represents terrific value at the moment so for us there is downside.

However, the objective was to win and make a few bucks in what has become the doldrums for trading every single month. And you know our feelings on this issue.

Back to bet. We bought yesterday for $36.94. We then watched the price disintegrate as gold prices weakened. At times like this you tend to think that Day Trading is not for us, but we like the stock and did not take a large position.

All we can do is wait and do some research on other mining investments that might be worthy of our future investments. We do have a large watch list we is constantly under scrutiny and re-evaluation. When we think that we have a winner we will most certainly publish it on this site.

The news comes through that the rate will remain unchanged, the first time for numerous months although it was not that hard to predict. The next day gold starts on the path north and Agnico Eagle which was a lot less that we paid for it starts its recovery;

GO Eagle GO!

Eagle moves up and we are now at break-even point, phew! This stock keeps on rising to $37.32, a rise of $0.38, be patient! Something we need to practice. The rise continues and shows a gain of about $0.47, yippee, however gold bangs its head on the $650 ceiling, meets resistance and starts to fall. The stock drops with it, we decide to sell at $37.28, may be too early but with a little profit of $0.34.

So we made a few bucks and had a little excitement in the doldrums to boot. No doubt there are better ways to do this, but, for us this move had no downside and as Warren Buffett once said, “the most important thing in investment is not to lose money”

So back to the big picture, hope you enjoyed the ride.

09 August 2006
Tuesday
Aug082006

Agnico Eagle Mines Ltd: Fancy a quick bet?

Our bet is that the Fed will hold interest rates today, with a subsequent rise in the gold prices, which will push the gold mining stocks higher.

EagleLogo2

Betting is not our particular thing, however, if we were betting people then today we would be looking for a way to take advantage of the FOMC meeting.

Whether you use spread betting, options, and futures or buy a gold mining stock likely to respond to a Fed decision is your choice.

As we are more interested in investment than straight out gambling we would shy away from betting as such. However, investment is a bit of a gamble anyway so we thought that we would take a quick look at it.

It’s a punt but we think that the rates will remain unchanged, even if they go up the market commentators will probably say that this is the last rise for some time so it is still positive for gold.

If you want the leverage that derivatives can offer along with the excitement and all that sweating, then that’s up to you. Being a little conservative in our thinking we would tend to opt for buying a mining stock at the opening today, say Agnico Eagle (or one of your favourites) and hold it for a day or so to allow the rate news to hit the media. With ‘in and out’ costs being comparatively cheap it won’t take much of a rise in gold to move Agnico and cover your costs. So, if you but 1000 shares in the stock and get a $0.50 rise, then you have made $500.0 less commission. If the stock goes up $1.0, then you have made a $1000.0.

Agnico closed at $37.20 yesterday I will report back tomorrow on how the bet progressed.

Don’t go crazy with this sort of move, only put down what you can afford to lose.

The downside is that we are wrong and gold falls taking Agnico with it. As we are accumulating this stock it is not a problem for us to hold it, but we will have lost the bet, technically speaking.

Good luck!

08 August 2006
Monday
Aug072006

BARRICK GOLD CORP: Not for us

Stock performance is about comparison and compared to some of the mid caps Barrick Gold Corp lacks glitter.

Barrick has a Market Cap of $27 Billion, a real heavy weight in the gold mining sector. But does it punch its weight? Is big automatically beautiful? We have watched this company for some time and as an investment it is making money. But, in terms of percentage gains, the mid caps are more appealing to us.

For example, lets compare Barrick's performance over the last 12 months with Agnico Eagle and Kinross:

Barrick August 2005 $26, August 2006 $32, a 23% rise.

Agnico August 2005 $15, August 2006 $37, a 146% rise.

Kinross August 2005 $6, August 2006 $12, 100% rise.

In terms of growth 23% in 12 months is very good, but this is a gold bull market! Who knows how long it will last? We need to be positioned to ride this bull well and that means we have to choose those gold mining stocks that are capable of decent acceleration.

The purchase of NOVAGOLD RESOURCES INC may help the cause, if they get it? However, Barrick are miners who have hedged their production in the past and this strategy reduces your exposure to the movement of gold prices. As a policy we prefer to invest in unhedged mining stocks.

We will continue to observe with interest but for now we think that we can find more interesting gold plays elsewhere.




NOVAGOLD RESOURCES INC can be found under the symbol NG trading on the AMEX, and BARRICK GOLD CORP can be found under the symbol ABX, trading on the NYSE.

07 August 2006
Saturday
Aug052006

Kinross Gold Corporation: Update 05 August 2006

Kinross Gold Corp beat most analysts’ expectations by announcing record second-quarter earnings.

Base in Toronto this gold mining company generated profits of $65.6 million or 19 cents a share up from a loss of $16.4 million.

An average realized gold price of $625 an ounce pushed profits up by 48% to $252.3 million. The company said it remains on schedule to produce about 1.44 million gold equivalent ounces for 2006.

Looking forward to 2008 the company said the Paracatu project would start up in then and is expected to produce about 557,000 ounces of gold a year from 2009 through 2013.

We are pleased with this purchase and will follow its progress closely as we expect their ambition coupled with the coming increase in gold prices to push this mining stock right through the ceiling. If you haven’t already made an investment in this stock then don’t leave it to late, there may not be many more ‘dips’ to buy in to.

05 August 2006
Saturday
Aug052006

Silverado Gold Mines Ltd: Gold Update 05 August 2006

In a recent press release Silverado stated that over $1,000,000 of large jewellery grade gold and collector's nuggets have been recovered and polished for sale.

SilveradoGold

The gold recovery and processing operations at the Nolan Gold Mine, Alaska, is almost complete. The infrastructure necessary for gold recovery during the next season is now in place.

As we all know it takes time to establish a mining operation and we need to be patient. Once production increases then all the world will want a piece of the action, the stock price will be considerably higher than it is now with the opportunity to be first in and best dressed will have already gone.

Last winter Silverado mined only 25% of the gold bearing gravel in the Swede channel, leaving the remaining 75% of the gold ore for this winter's operation.

In addition to the Swede Channel, they have located other gold channels, which cause gold to accumulate on ancient hillside "benches" as the channels drain gold down the mountain from its source, these are still to be exploited.

We bought in at eight cents and will take this opportunity to buy again as Silverado is trading around six to seven cents. For the purposes of measuring our performance we will use the eight-cent price, as we believe it is only fair to do so.

05 August 2006





Saturday
Aug052006

Silverado Gold Mines Ltd: Green Fuel Update

Buried in a recent press release regarding Silverado’s progress, the President and CEO, Garry Anselmo, give us a green fuel clue. He said that the company continues to move forward and that a lot of the ‘behind-the-scenes’ activity had been completed on the LRCW Fuel project. By this, he is referring to the on-going negotiations with various government departments, which really is good news.

The little gem in what he said was his reference to a very exciting announcement either in August or September. We don’t have any further information at the moment but we would guess that it could mean some sort of government aid may be in the form of funding. This is just a guess on our part. However, it does make sense to us. Why would the United States want to be reliant on oil? Oil is supplied in the main, by the Russians and the Middle Eastern countries, how reliable is it? Would it not be better to be dependant on your own resources? Geopolitically, alternative fuels such a green, clean fuel at $15.0 per barrel approximately, has to be the way to go.

At a little over six cents a share it is well worth accumulating now.

05 August 2006.
Wednesday
Aug022006

BE BOLD: Buy and Hold Gold


As you know we prefer the gold mining stocks to holding the metal however, if you prefer to have the real deal in your hands then do it now. R.I.P. $500 gold.

We have to say that we extremely bullish on the yellow metal and gain more confidence with each day by our stocks performance.

This website leans towards those mining stocks that will be affected the most by any movement in gold prices. We tend to select those stocks, which do not forward sell their gold production, commonly known as hedging. An index of mainly unhedged stocks is collected together in the HUI index. Our objective is to outperform the HUI which means some of our stock picks will be riskier than most, although a few of them are constituent parts of the HUI. So, when deciding what to buy bear in mind that our selections could flop in a dramatic fashion or conversely put in a life changing performance.

At the moment we are looking for $850 plus by the year-end coupled with the gold mining sector playing catch up in a big way. News Year Eve will be champagne time.

However, when considering which asset class to invest in we are very bullish on silver and Uranium. Should you wish to read our opinion on these metals then just click on silver or uranium and you will see our sister websites.

02 August 2006.