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7 Best Stocks to Buy on the Dip in October

September and October are historically tough months for equities and 2021 is proving no different. For instance, September meant the worst performance…

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September and October are historically tough months for equities and 2021 is proving no different. For instance, September meant the worst performance for the S&P 500 since the height of the pandemic. Over the past month, the Nasdaq 100, Dow Jones Industrial Average and S&P 500 are down about 3%, 0.30% and 1.1%, respectively. But that’s not the only thing affecting what stocks to buy.

In addition to a tough season, investors are concerned over a potential debt crisis in China due to the struggling property developer Evergrande (OTCMKTS:EGRNY). That has added to growing worldwide worries over increased levels of inflation. Plus, there are worries about the effect of the Covid-19 delta variant.

Wall Street has also been increasingly spooked by uncertainty around the U.S. debt ceiling. In recent days, the Senate has temporarily raised the nation’s debt limit. However, question marks still loom. For instance, Reuters reported that many analysts are debating whether now would be an opportune time to buy the dip.

Still, while these issues have led to significant volatility in equities, the recent declines in price for many Street darlings have made them much more affordable for buy-and-hold investors. So, without further ado, here seven of the best stocks to buy on the dip this October:

  • Activision Blizzard (NASDAQ:ATVI)
  • First Majestic Silver (NYSE:AG)
  • Icad (NASDAQ:ICAD)
  • Lam Research (NASDAQ:LRCX)
  • Micron (NASDAQ:MU)
  • Palantir (NYSE:PLTR)
  • Sierra Wireless (NASDAQ:SWIR)

Stocks to Buy: Activision Blizzard (ATVI)

Source: Eric Broder Van Dyke/Shutterstock.com

52-week range: $71.19 – $104.53
Dividend yield: 0.62%

First up on this list of stocks to buy, Activision Blizzard is one of the most important publishers of interactive entertainment content out there. The company creates and distributes content and services across multiple gaming platforms.

Management issued second-quarter results back in early August. For the period, revenue went up by about 19% year-over-year (YOY) to $2.3 billion. Additionally, net income came in at $876 million, or $1.12 per diluted share, compared with a net income of $580 million (75 cents per diluted share) in the prior-year quarter. Cash and equivalents ended the quarter at $9.2 billion. Finally, the company generated a non-GAAP free cash flow (FCF) of $374 million, down 50% YOY. On the results, CEO Bobby Kotick remarked:

“With respect to our financial performance, we are pleased that the company continued to deliver strong results in the second quarter, and we are raising our outlook for the year.”

Thanks to the rapid growth of interactive entertainment, the video game industry has seen significant gains over the past decade. However, analysts now forecast slowing growth in the near term as the pandemic-induced momentum in player engagement fades. After a 32% YOY increase in 2020 bookings, Activision anticipates growth to slow this year.

On top of this, back in July, California’s Department of Fair Employment and Housing (DFEH) filed a lawsuit against the company. The accusations center around gender discrimination and sexual harassment issues within ATVI. Later, in September, Wall Street learned that Activision settled another similar lawsuit with the U.S. Equal Employment Opportunity Commission (EEOC), a federal agency. It is not yet clear how this settlement could affect the outcome of the DFEH lawsuit. However, investors have not been pleased with these allegations.

That said, ATVI stock is currently down roughly 26% from its 52-week high. It trades around $77, down 17% year-to-date (YTD). This dip could be a good opportunity to buy a leading video game stock prior to several major game releases. Shares are currently trading at 19.75 times forward earnings and 6.52 times trailing sales.

First Majestic Silver (AG)

Macro of silverSource: Phawat / Shutterstock.com

52-week range: $9.62 – $24.01
Dividend yield: 0.09%

Next up on this list of stocks to buy, Canadian miner First Majestic Silver mainly focuses on silver production in Mexico, with the majority of its revenues coming from silver. The company operates three key silver mines in Mexico as well as another one in Nevada.

Management released Q2 results in mid-August. For the period, total revenue increased more than 340% YOY to a record of $154.8 million, fueled by its recently acquired Jerritt Canyon Mine in Nevada. What’s more, net earnings came in at $15.6 million, or 6 cents per diluted share, compared to a net loss of roughly $10 million (a loss of 5 cents per diluted share) in the previous year. Lastly, cash and equivalents ended the quarter at $227 million. On the results, CEO Keith Neumeyer remarked:

“Improved production rates and higher metal prices during the quarter generated record revenues for the business […] As a result of the higher revenues, our quarterly dividend increased by approximately 33% when compared to the prior quarterly payment.”

Silver often performs well when the economy is in recovery mode. So, if global demand for goods picks up further in the coming quarters, First Majestic could be well-positioned to benefit from the rising value of the metal.

This miner anticipates solid production growth in 2021, but margins are expected to decline in the near term due to rising costs and capital expenditures. AG stock currently trades a bit above $12, down roughly 7% so far this year. According to Seeking Alpha, shares are trading at 50.88 times forward earnings and 5.54 times trailing sales.

Stocks to Buy: Icad (ICAD)

Image of a hospital with workers walking in the hallsSource: Shutterstock

52-week range: $8.73 – $21.44

A manufacturer of medical devices, Icad uses artificial intelligence (AI) technology to improve both the detection and treatment of various cancers. Specifically, the company offers computer-aided detection and workflow solutions for breast, prostate and colorectal cancers.

Like other stocks to buy on this list, Icad released Q2 results back in early August. Revenue surged about 39% YOY to $7.8 million. Additionally, non-GAAP net loss came in at $2.8 million, or 11 cents per diluted share. That’s compared with a non-GAAP net loss of $2.5 million (a loss of 12 cents per diluted share) for the prior-year period. Lastly, cash and equivalents ended the quarter at $37.9 million. After the announcement, CEO Mike Klein noted the following:

“Our second quarter total revenue was negatively impacted by longer than expected Enterprise sales cycles in several large prospective accounts.”

This group is currently developing a series of imaging and radiation application devices to achieve more targeted treatment of various cancers. Right now, ICAD stocks hovers at slightly below $11, down some 50% from the 52-week high. Shares are also down 19% YTD and trade at 7.4 times trailing 12-month (TTM) sales. With its emphasis on innovative medical solutions, interested readers may want to do further due diligence on the company.

Lam Research (LRCX)

Close-up electronic circuit board. technology style concept. representing semiconductor stocksSource: Shutterstock

52-week range:  $333.31 – $673.80
Dividend yield: 1.10%

LRCX stock is the next pick of the stocks to buy on this list. A semiconductor manufacturing equipment supplier, Lam Research is well known among chip investors as a leading producer of etch and deposition machines, critical for producing leading-edge chips. Its tools are used for advanced DRAM and 3D NAND flash storage.

Back in late July, Lam Research announced Q2 2021 results. For the period, revenue increased nearly 49% YOY to $4.15 billion. Additionally, GAAP net income surged 64% YOY to $1.14 billion, or $7.98 per diluted share. Additionally, cash and short-term investments remained flat at $6 billion. On the metrics, CEO Tim Archer commented the following:

“Lam continued its record performance in the June quarter, capping a fiscal 2021 with more than 45% revenue growth and an increase of over 70% in earnings per share.”

Leading-edge chips are increasingly used in numerous applications and industries. As a result, the semiconductor industry is shifting from a cyclical business to a steady growth industry. For instance, analysts expect 5G to provide a significant tailwind for top-line growth. This is because emerging 5G technologies require advanced chips in high-end smartphones and data centers. Therefore, Lam’s equipment will stay in high demand.

The manufacturer also just raised its dividend 15% in August. LRCX stock now yields 1.1% and hovers above $560. It’s up almost 20% YTD but is still 16% lower than its 52-week high. Shares trade at about 16 times forward earnings and 5.3 times trailing sales.

Stocks to Buy: Micron (MU)

Micron Stock is Well-Positioned to Trend Higher in 2020 … and BeyondSource: Valeriya Zankovych / Shutterstock.com

52-week range:  $49.30 – $96.96
Dividend yield: 0.15%

Another chip darling on this list of stocks to buy, Micron Technology, manufactures high-performance DRAM, NAND and NOR memory and storage products used in PCs, data centers, smartphones, game consoles and automotive, among other electronic applications.

Micron announced Q4 fiscal 2021 results back in late September. For the quarter, revenue surged over 36% YOY to $8.27 billion. The company also generated a non-GAAP net income of $2.78 billion, or $2.42 per diluted share. That’s compared to $1.23 billion, or $1.08 per diluted share, in the prior-year quarter. Finally, adjusted FCF stood at $1.88 billion while cash and equivalents ended the period at $7.8 billion. CEO Sanjay Mehrotra remarked the following on the results:

“Micron’s outstanding fourth quarter execution capped a year of several key milestones […] In fiscal 2021, we established DRAM and NAND technology leadership, drove record revenues across multiple markets, and initiated a quarterly dividend.”

In particular, management highlighted that the semiconductor shortage could persist through 2022. The recent price decline in tech shares has also affected MU stock, which has lost about 30% from the all-time high. Currently, the stock changes hands around $70, down nearly 10% YTD. Shares also trade at only 7.2 times forward earnings and 2.7 times sales. Interested readers could find value around these levels.

Palantir (PLTR)

A close-up shot of a hand on a screen with the Palantir (PLTR) logo.Source: Ascannio / Shutterstock.com

52-week range:  $9.18 – $45

Palantir Technologies is one of the leading players in the data mining, analytics and security space. Through its platform, clients can analyze large amounts of data and drive operational outcomes. Its products also help governments and enterprises secure access to sensitive data.

Like others in this article, Palantir announced Q2 results in mid-August. Total revenue surged 49% YOY to $376 million for the period. What’s more, while GAAP net loss increased over 25% to $138.6 million, Palantir was still profitable on an adjusted basis, posting adjusted earnings per share (EPS) of 4 cents. Adjusted FCF came in at $50 million as well. Finally, cash and equivalents ended the period at around $2.4 billion.

This company operates two primary platforms: Gotham and Foundry. Gotham serves government agencies, particularly ones in the defense and intelligence sectors. Meanwhile, commercial clients rely on the Foundry platform.

Wall Street believes Palantir could be well-positioned to benefit from the tremendous growth in “Big Data.” The company anticipates its market opportunity at $119 billion and predicts revenue growth of at least 30% annually through 2025.

PLTR stock has gained 160% over the past one year. During the meme-stock frenzy in January, it skyrocketed to $45 per share. Yet, it’s currently down about 45% from its peak, hovering under $25 territory. This pick of the stocks to buy is currently trading at 29 times TTM sales.

Stocks to Buy: Sierra Wireless (SWIR)

5G digital hologram floating over a phone on a city background. representing 5g stocks investing for the next decadeSource: Fit Ztudio / Shutterstock.com

52-week range:  $10.45 – $22.22

Our last pick on this list of stocks to buy is Canada-based Sierra Wireless, a wireless networking equipment manufacturer focusing on Device-to-Cloud Internet-of-Things (IoT) solutions. The company’s products and services include machine-to-machine communications equipment, high-speed cellular modules,  connectivity services, cloud platforms and cellular gateways.

Sierra Wireless released Q2 results back in mid-August. Revenue increased 19% YOY to $132.8 million, easily exceeding the higher end of its sales guidance. Moreover, adjusted net loss declined to $1.1 million, or 3 cents loss per share, compared to an adjusted net loss of $13 million (36 cents per share) in the prior-year quarter. Finally, cash and equivalents ended the quarter at $118.4 million. On the metrics, CEO Phil Brace remarked:

“Revenue in the Second Quarter improved year over year and sequentially, non-GAAP operating expenses remained flat with the prior quarter, and Adjusted EBITDA improved.”

With its focus on machine-to-machine communications, Sierra’s product line has been particularly relevant to IoT applications. For instance, its 5G products provide solutions for increased IoT connectivity. In addition, Sierra has introduced the first multi-network 5G-capable vehicle router, an essential step for the future of the automotive industry.

SWIR stock recently declined after failing to provide near-term guidance due to “production interruptions [from] COVID-19 cases at a contract manufacturing facility in Vietnam.” The stock hovers at slightly below $16 and is up more than 8% YTD. What’s more, SWIR trades at only 1.2 times trailing sales. Given its vast addressable market and depressed price, long-term investors might consider buying the dip in these shares.

On the date of publication, Tezcan Gecgil did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Tezcan Gecgil has worked in investment management for over two decades in the U.S. and U.K. In addition to formal higher education in the field, she has also completed all 3 levels of the Chartered Market Technician (CMT) examination. Her passion is for options trading based on technical analysis of fundamentally strong companies. She especially enjoys setting up weekly covered calls for income generation.

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Articles

Marvel positioning itself as a major landowner in Exploits Subzone of Central Newfoundland

2021.10.16
Marvel Discovery Corp. (TSXV:MARV, Frankfurt:O4T1, MARVF:OTCQB) is a company on the move, with active projects in the Exploits Subzone of Central…

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2021.10.16

Marvel Discovery Corp. (TSXV:MARV, Frankfurt:O4T1, MARVF:OTCQB) is a company on the move, with active projects in the Exploits Subzone of Central Newfoundland and the Atikokan gold camp in northwestern Ontario where the junior has been reporting visible gold at its Blackfly project.

Marvel’s business strategy is fairly straightforward: identify virgin ground that has been “passed over” by larger companies, acquire the claims and begin exploring, first running geophysics to identify targets, then drilling them.

An example of this tactic is what Marvel has been doing in Central Newfoundland.

Exploits Subzone

The Vancouver-based company has assembled a sizeable land position, over 100,000 hectares, right in the thick of the Exploits Subzone of Central Newfoundland — potentially one of the world’s last easily accessible, district-scale gold camps. 

It is known to contain deep-seated gold-bearing structures of the Dog Bay-Appleton Fault — GRUB Line deformation corridor, and is home to the high-grade Keats Zone of New Found Gold (TSX:NFG).

See below for Marvel’s map of the area including the major faults shown as heavy black lines.

The Exploits Subzone of Central Newfoundland

This past summer, Marvel was busy snapping up claims and adding to its land package.

The Victoria Lake project is among the most prospective of Marvel Discovery Corp.’s seven Newfoundland properties.

Located within the Exploits Subzone, the property is bolted onto Marathon Gold’s 4-million-ounce Valentine gold project, which is Atlantic Canada’s largest undeveloped gold resource.

Victoria Lake and Valentine exhibit a similar style of gold-bearing veins and have structural and geological settings in common. Preliminary work on Victoria Lake identified several quartz-arsenopyrite veins returning grab samples ranging from 15.5 to 24.9 g/t gold and 18.6 to 139.3 g/t silver.

In 1995, grab samples from Vein #3 featured 162.7 g/t gold and 220 g/t silver.

Marvel’s Victoria Lake project is bolted onto Marathon Gold’s 4Moz Valentine gold deposit.

In mid-September Marvel acquired an additional 53 mining claims at Victoria Lake comprising 1,325 ha, increasing its land position to 7,650 ha. The company says the acquisition is located along the Exploits Subzone and covers a large, highly prospective structural zone proximal to the Valentine Lake Shear Zone hosting Marathon Gold’s (TSXV:MOZ) Valentine Gold Project with  resources of 4M oz. of gold…

Victoria Lake Gold Project is host to interpreted extensions of the Valentine Lake Shear Zone and two major thrust faults, a wide structural corridor interpreted to play an integral part in the Marathon Gold Deposit.

In fact the claims, acquired via an option agreement with a vendor, contain the highest regional gold-in-till sample — 785 parts per billion (ppb) Au. This high-grade surface gold area was never followed up with additional exploration, making it a juicy target for Marvel Discovery Corp.

“These claim additions were a strategic move, not only in expanding the size and potential, but tying up ground with the highest gold till-in-soil samples in the province of Newfoundland,” Marvel CEO Karim Rayani commented in the Sept. 14 news release. “This shows we are in the right place for a potential discovery adjacent to what will likely become Newfoundland’s next and largest gold mine.”

An important part of Marvel’s Newfoundland narrative is the ground it has acquired near Falcon Gold (TSXV:FG), a sister company to Marvel Discovery also headed by Rayani.

Combined, the two juniors are the largest landowner next to Marathon Gold’s monster 4Moz Valentine gold project, and they each have claims on the Hope Brook gold project.

At Hope Brook, Marvel’s land position straddles both the eastern and western extents of recent land acquisitions by the Sokoman/Benton JV partnership, with Marvel now controlling areas of considerable structural complexity marked by large-scale fold and fault structures, which provide important structural controls (traps) for gold mineralization.

Rock lithologies and structures on the property are also related to those associated with Marathon Gold’s Valentine gold deposit, Sokoman’s Moosehead gold project and New Found Gold’s Queensway gold project — the first mover in the highly prospective Central Newfoundland Gold Area Play.

Marvel’s Hope Brook gold property is contiguous to First Mining and the Sokoman-Benton joint venture.

The Hope Brook mine was in production from 1987 to 1997, producing 752,163 oz. Coastal Gold outlined 6.3Mt at an average grade of 4.68 g/t Au, for 954,000 oz in the indicated and inferred categories.

In a phone call with me on Thanksgiving Monday, Rayani positioned the expanded Hope Brook project (19,075 ha now owned by Marvel) in relation to its neighbors:

“To the north you have Matador which I believe is 800,000 oz, to the south you have another deposit by First Mining optioned to Big Ridge which is another million oz of identified [gold], and we have all of the ground right in the middle so we’re tied onto major structures, we’ve got ground at Valentine Lake, we’ve got ground on three of the largest systems out there.”

He emphasized, “Our objective is to cover off whatever is not covered by government mag [magnetic survey] and fly the rest of it ourselves, then package it up and see what we’re going to do. I would like to try and do as much of the work ourselves and then make a decision as to what we’re going to drill.”

Initial permits have been filed for a first phase of exploration at Hope Brook which includes high-resolution magnetic gradiometry surveys that help to sort structural complexities in geological terranes. The company will also be sending prospecting crews to begin baseline prospecting to determine if the magnetic trends highlighted in regional government surveys are due to similar mineralized structures as those hosting the nearby Sokoman/Benton lithium discovery — the first documented occurrence of lithium in the province of Newfoundland-Labrador.  

“Marvel and our sister company Falcon Gold have made a lot of noise as of late not only in acquiring sizable land positions tied on to major structures but also following the structures to find what we believe are hidden gems that have been overlooked and passed by. Sokoman-Benton’s new Lithium discovery is less than 10 km away and is a testament to our business model,” Rayani stated in the Sept. 20 news release.

Blackfly

The Atitokan gold camp in Ontario is one of the country’s most prolific, and the Blackfly project is one of the camp’s earliest gold occurrences, dating as far back as 1897.

The property is in a highly enriched gold neighborhood, located within the Marmion Lake fault zone about 14 kilometers from Agnico Eagle’s Hammond Reef gold deposit, which hosts an estimated 3.32 million ounces of gold in reserves.

Marvel’s Blackfly project is 14 km from Agnico Eagle’s Hammond Reef gold deposit, with 3.32Moz in gold reserves.

Marvel’s mission is to see whether the historical exploration around the Blackfly mine has more to offer. So far the results look promising.  

Drilling commenced on June 24, with nine diamond drill holes out of 16 completed to date for 1,116m. Drilling has concentrated around the historical shaft area with four holes drilled at the Blackfly Northeast Zone.

Visible gold has been discovered in a number of surface samples and in multiple drill holes, a very good sign that MARV may have hit upon a gold system of yet to be determined size. Four sub-parallel gold mineralization trends have been confirmed by drilling.

Specks of visible gold in hole BF21-19 drilled at the Blackfly Northeast Zone.

“We’re just waiting on the final numbers.” Rayani told me, adding that there is a new zone he expects will report better results than former operator Terra-X.

According to Terra-X’s assessment report, the lineament containing the Blackfly vein has alteration and mineralization traceable over a 4.4-km strike length, as shown by the distribution of samples collected along it.

The best gold values from this lineament occur within the historical work, where Terra-X’s grab samples included results of 167 g/t and 85.6 g/t Au.

Conclusion

Marvel represents an intriguing opportunity for investors looking for an undervalued junior in one of the most exciting gold plays on the planet, the Exploits Subzone of Central Newfoundland.

Larger players like New Found Gold and Marathon Gold have seen success at the drill bit and their market capitalizations have grown accordingly. NFG currently trades at $8.82 per share with a market cap of $1.3 billion while MOZ has a market value of $734 million @ a share price of $3.02. Most of the money here, imo, has already been made. Penny stocks like Marvel offer much better opportunity for share price appreciation.

Central Newfoundland is shaping up to be a classic area play, with over a dozen companies having established a presence there, either buying up claims around the big gold deposits, like Queensway and Valentine, conducting exploration programs or in the case of Marvel Discovery Corp., both. Marvel has applied for exploration permits at Hope Brook and has significantly expanded its land position at Victoria Lake.

I wouldn’t be surprised to see further consolidation in the Central Newfoundland Gold Area Play. If a company like NFG, backed by big money, with Eric Sprott and merchant bank Palisades Goldcorp owning a combined 51% of the shares, were to start making acquisitions, the boost to smaller juniors like Marvel could be dramatic.

Over at Blackfly, Marvel’s mission is to see whether the historical exploration around the Blackfly mine has more to offer. So far the results look promising.  

Nine diamond drill holes have been completed to date for 1,116m. Drilling has concentrated around the historical shaft area with four holes drilled at the Blackfly Northeast Zone.

Visible gold has been discovered in a number of surface samples and in multiple drill holes, a very good sign that MARV may have hit upon a gold system of yet to be determined size. 

Marvel Discovery Corp. has everything we like to see in a gold junior, starting with a great property in an established gold jurisdiction. However, the company understands it’s never a good idea to put all your eggs in one basket. Management has acquired claims close to the big players in the Exploits Subzone of Central Newfoundland. The company already has one of the best prospecting teams in the province, and from what I’ve seen so far, great management that understands the lifeblood of a junior is a steady flow of news. Rayani hinted there will be more announcements from MARV before the year is out. Stay tuned.

Marvel Discovery Corp.
TSXV:MARV, Frankfurt:O4T1, OTCQB:MARVF
Cdn$0.10, 2021.10.15
Shares Outstanding 73.8m
Market cap Cdn$7.9m
MARV website 

Richard (Rick) Mills
aheadoftheherd.com
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Precious Metals

Mountain Boy Minerals awaits assay results on seven holes drilled at American Creek, surface sampling returns high grades

2021.10.16
Drilling at Mountain Boy Minerals Ltd.’s (TSXV: MTB) (OTCQB: MBYMF) (Frankfurt: M9U) flagship American Creek property in British Columbia…

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2021.10.16

Drilling at Mountain Boy Minerals Ltd.’s (TSXV: MTB) (OTCQB: MBYMF) (Frankfurt: M9U) flagship American Creek property in British Columbia is progressing well so far, with a total of seven holes completed from two drill pads.

Five of the holes were completed in the High-Grade zone, with the remaining two on the High-Grade extension. Core samples have been shipped to the lab, with assays pending.

The drill has since been mobilized to the third pad at the Maybee zone, where drilling is currently underway.

Results from surface sampling of the property earlier this season have also been received, with assays of up to 3,444 ppm Ag (Maybee zone), 6.166% Cu (High-Grade zone), 15.26% Pb (Mann zone) and 17.57% Zn (High-Grade zone).

The recent work by MTB included mapping and sampling along the cliffs north of the old mine, an area that had not previously been examined due to the difficult access.

Geologists skilled in rock climbing traced the structure hosting the High-Grade mineralization approximately 400 m to the north, identifying an area now referred to as the High-Grade extension, where the initial two holes were completed.

Geological work is continuing, focusing on the area between the High-Grade zone and the Maybee zone, a 2 km long corridor within the 33 sqkm property. Multiple veins in that area remain underexplored to this day.

The intent of the current program is to improve the geological context with the intent of identifying further drill targets.

“Silver and base metal mineralization has been identified over multiple kilometers and includes some exceptional grades. We are working systematically toward an understanding of this extensive and robust mineralizing system which we firmly believe has the potential to host the kind of deposit for which the Golden Triangle is renowned,” Mountain Boy CEO Lawrence Roulston commented in a news release dated August 16.

American Creek Overview

The American Creek project is centered on the past-producing Mountain Boy silver mine, located 20 km north of Stewart in BC’s Golden Triangle.

The property has favourable host stratigraphy, including rocks from the Lower to Middle Jurassic Mount Dilworth formation and Lower Jurassic Hazelton Group. Recent geochronology also confirmed the presence of Early Jurassic intrusions on the property.

Geology of American Creek

There is abundant evidence pointing to large, continuous regional and property scale faults, folds and shear zones, which are often related to mineralization in the region. Significant alteration and mineralization have already been observed along these structures forming the American Creek corridor.

Therefore, Mountain Boy Minerals considers the area to have “real potential to host one or more deposits.” While it holds a significant land package, with a variety of targets identified, much of the project area remains underexplored.

Mapping and prospecting on the project so far have already led to multiple discoveries, including a new area of gold-silver-base metal mineralization on Bear River Ridge, a silver and base metal intermediate epithermal system along an approximate 2 km trend, and — more importantly — an Early Jurassic latite porphyry intrusion below the epithermal system.

This previously unrecognized intrusion is similar in age to the many Jurassic Intrusions that are related to several deposits in the area, including the Premier porphyry, which is directly related to what was once considered North America’s largest gold mine.

Ascot Resources is currently focused on restarting the historic Premier mine, which has produced over 2 million ounces of gold and 45 million ounces of silver.

The Stewart mining camp — where American Creek and many other MTB projects are found — is part of the larger Stikinia Golden Triangle and is known to contain well over 200 mineral occurrences.

“The presence of numerous nearby past producers, an evolving understanding of the geology and encouraging results and discoveries in the region all support the highly prospective nature of the area,” the company commented on its flagship asset.

2021 Exploration Program

For this year’s program, detailed structural mapping has concentrated around the many mineralized showings on the American Creek project, including the High-Grade zone.

Results from this mapping suggest that the High-Grade zone mineralization is related to an interpreted shallow westward dipping thrust fault and east-west steeply dipping cross-cutting structures.

It is postulated that the best mineralization occurs at the intersection of these two structures, and this year’s drilling will test this hypothesis.

Geologists have been working with a mountain guide mapping the cliffs around the historic silver mine. This has resulted in the discovery of several new mineralized showings to the north. The mineralization appears to be within the same stratigraphic horizon as the High-Grade zone and is cut by similar steeply dipping cross structures.

Drilling last year demonstrated that the shallow structures intersected in drill holes are rich in base metals and likely represent one of several mineralizing pulses in the epithermal system.

Guided by additional mapping results, the company has turned to steeper cross structures and localized ore shoots during this season’s drilling.

The 2021 drill program is specifically targeting four areas: the High-Grade zone, the newly discovered extension of the High-Grade zone, the Four Bees zone and the Maybee zone to the north.

Drilling of the High-Grade zone occurs at a different azimuth with the intent of testing the intersection of the shallow westward dipping thrust fault and the east-west cutting cross structures.

In 1999-2000, 51.6 tonnes of material were extracted from the High-Grade vein and sent to the Cominco smelter in Trail, BC. The documented grades of 13.6 tonnes of this material were 18.854 kg/t Ag, 1.1% Zn and 2.5% Pb.

These exceptional grades demonstrated why this is still such a compelling target to drill.

BA Project Update

Elsewhere in the Golden Triangle, Mountain Boy is also moving forward with a drill program on the BA silver-lead-zinc VMS project, located 18 km northeast of Stewart.

The 10,658-hectare BA property was acquired by Mountain Boy in 2006 following the discovery of the Barbara zone, where initial sampling yielded assays of 5.24% Zn, 0.66% Pb and 55.2 g/t Ag over 1.7 m, and 2.17% Zn, 0.41% Pb and 13.5 g/t Ag over 1.2 m.

Drilling continued at the Barbara zone over a three-year period, with a total of 13,570 m in 93 holes completed from 55 different drill pads. Significant silver, lead and zinc mineralization was encountered both in drilling and on surface.

A joint venture was later formed with Great Bear Resources to conduct an aggressive exploration program of the Barbara zone and its surroundings, which brought the total drill count to 178 holes (28,484 m).

A preliminary resource (2016) of the Barbara zone on all the drilling (excluding surface trenching was) showed 8.93 million tonnes of ore at 0.96% Zn, 0.017% Cu, 0.30% Pb and 36.77 g/t Ag, for a total of 188.6 million pounds of zinc equivalent (1.96% zinc equivalent).

The current drill program is designed to target the northern extension of the mineralized horizon at the Barbara discovery that was drilled between 2007 and 2010.

The historic drilling delineated substantial near-surface silver-lead-zinc mineralization extending over 610 m, striking north-northeast. Since then, receding glaciers at the northern end of the zone have exposed further mineralization at surface.

This mineralization has subsequently been sampled in three channel sampling campaigns extending the zone of mineralization to at least 700 m. Assays of up to 601 g/t Ag, 1.98 g/t Au, 3.31% Pb and 9.96% Zn have been returned from these programs.

Silver Rebound

Mountain Boy’s drilling of two highly prospective silver properties comes just as the precious market is experiencing a rebound due to re-emerging inflation concerns around the global economy.

For the month of September, the US consumer price index rose by more than forecast, which underscored the mounting inflation pressures in the world’s #1 economy. This in turn has driven up investor demand for assets that serve as inflation hedges such as gold and silver.

Source: Kitco

Coming off a record year, silver prices have somewhat pulled back in recent months, but the latest economic indicators are suggesting another rally is in the works, especially with the US Federal Reserve looking to tighten its stimulus measures very soon.

Daniel Briesemann, an analyst at Commerzbank AG, wrote in a Bloomberg note that he expects the tapering to be announced at the next meeting early in November, he said.

“The market is now seeing a major pivot here as far as how inflation is showing more signs of being persistent than transitory, and that’s likely to force the Fed’s hand to deliver a rate hike well in advance of what people were anticipating,” Oanda’s senior market analyst Edward Moya told Reuters this week.

The anticipated Fed tapering has so far led to a retreat in 10-year Treasuries and the greenback, both of which are traditionally investment alternatives to safe-haven metals.

In silver’s case, the outlook is particularly bright given its strong industrial demand on top of the monetary driver. In fact, much of silver’s value is derived from industrial demand and supply fundamentals. It’s estimated around 60% of the metal is utilized in industrial applications such as solar panels and electronics, leaving only 40% for investing.

A report by BMO Capital Markets shows that silver consumption by the solar industry alone could grow by 85% to about 185 million ounces within a decade.

In addition, silver demand for “printed and flexible electronics” is forecast to increase 54% over the next nine years, rising from 48Moz in 2021 to 74Moz in 2030.

Then there are the automotive and 5G sectors, which are likely to become even bigger demand drivers in the future. A comprehensive report by Sprott titled ‘Silver’s Clean Energy Future’ found that three areas of growing demand for silver — solar, automotive and 5G — potentially account for more than 125 million ounces in 10 years.

The question is whether the world will have enough supply of the metal by then.

According to the 2021 World Silver Survey, global demand for silver in 2021 is expected to outpace supply by 7% (+8% supply vs +15% demand), at which rate a significant market deficit will begin to surface.

Conclusion

In an article earlier this year, we showed the world has already reached peak mined silver. At the moment, there are simply not enough projects in development to generate the kind of production to match an accelerating demand.

When it comes to mining precious metals, the prolific Golden Triangle of British Columbia has never disappointed. Having consolidated a large property position within the region and integrated a wealth of exploration results, Mountain Boy Minerals could be well on its way to making an important silver discovery.

At American Creek, which is centered on a past-producing high-grade silver mine, work to date has supported the hypothesis of a large mineralized system capable of hosting deposits of the same scale as many others in the Triangle.

This year’s drilling at American Creek will test the true extent of this geological system, which, by the end of the program, could be demonstrated to extend over a 2 km length, containing several areas of silver-rich mineralization.

The fact that MTB compares this geological setting to the Premier camp, an important historic gold-silver producer, is also encouraging.

Mountain Boy Minerals Ltd. (TSXV: MTB) (OTCQB: MBYMF) (FSE: M9UA)
Cdn$0.16, 2021.10.14
Shares Outstanding 54m
Market cap Cdn$8.64m
MTB website

Richard (Rick) Mills
aheadoftheherd.com
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Economics

5 Canadian metal stocks to buy

Highlights Over 43 per cent of the global mining firms are listed on the Toronto Stock Exchange and Toronto Stock Venture Exchange A stock mentioned…

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Highlights

  • Over 43 per cent of the global mining firms are listed on the Toronto Stock Exchange and Toronto Stock Venture Exchange.
  • A stock mentioned here surged by 104.8 per cent in the past year.
  • One of the companies listed earned a gross profit of US$380.2 million in Q2 2021, an increase of US$238.1 million year-over-year.

The Canadian headline index surged by 201 points or 0.97 per cent before closing at C$ 20,819. 94 on Thursday, October 14. Base metals, information technology, and the industrials sectors traded in the green.

Over 43 per cent of the global mining firms are listed on the Toronto Stock Exchange and Toronto Stock Venture Exchange. Here’s a compilation of five TSX-listed metal stocks to consider.

Also read: Top 5 TSX value stocks to buy

  1. Teck Resources Ltd (TSX: TECK)

Teck Resources is engaged in the development and mining of mineral properties. Its business units are focused on zinc, copper, coal, and energy.

Its gross profit increased to C$ 233 million in Q2 from the steelmaking coal business segment.

The company posted an adjusted EBITDA of C$989 million in the second quarter of fiscal 2021, up by 104 per cent year-over-year. Its liquidity as of July 26, 2021, stands at C$6.1 billion.

The stock trading C$ 39.10 apiece holds a P/E ratio of 106.10 as of October 15. The stock’s one-year growth stands at 104.8 per cent and nearly 56.3 per cent YTD.

  1. First Quantum Minerals Ltd (TSX:FM)

The stock worth C$ 27.68 apiece grew by nearly 125 per cent in the past year and 21.13 per cent year-to-date. First Quantum Minerals produces gold, zinc, nickel, copper, and cobalt.

It has mining operations in Australia, Africa, and Latin America.

Also read: Top 3 Canadian smallcap stocks to buy this fall

Its cash flows from operating activities of US$679 million in Q2 2021 were US$524 million higher than Q2 2020.

First Quantum stocks hold a P/E ratio of 46.70, as per TMX data.

The mining firm had US$1.79 billion in net unrestricted cash and cash equivalents at the end of the quarter.

  1. Labrador Iron Ore Royalty Corporation (TSX:LIF)

In the second quarter of fiscal 2021, the investment company posted a royalty revenue of C$ 78.8 million, compared to C$ 46.2 million a year ago.

Its equity earnings from Iron Ore Company of Canada were C$66.2 million in Q2 2021, compared to C$28.7 million YoY.

The steel firm’s stocks surged by nearly 40 per cent in the past year, with a P/E ratio of 7.10.

The company pays a quarterly dividend of C$ 2.10 per stock, with a three-year dividend growth of 39.51.

Also read: This TSX oil & gas stock skyrocketed 285% in a year!

  1. Lundin Mining Corporation (TSX: LUN)

The mining firm’s stocks traded C$10.28 at close on October 14. The diversified base metals producer has operations in Chile, the US, Sweden, Portugal, and Brazil.

Lundin Mining’s gross profit for Q2 2021 was US$380.2 million, an increase of US$238.1 million year-over-year.

The Canadian mining leader had cash and a net cash balance of nearly US$250 million and US$ 190 million as of July 28, respectively. The firm has a return on equity (RoE) of 15.07 per cent and its current dividend yield of 3.5 per cent.

The stocks surged by over 34 per cent in the past year and over 12.8 per cent quarter-to-date.

  1. Turquoise Hill Resources Ltd (TSX:TRQ)

The firm through its principal asset, the Oyu Tolgoi copper-gold mine, is engaged in the exploration, development, and mining operations.

The international mining company posted US$ 317.8 million in revenue from the operating segment for the three months period ended June 30.  The stocks delivered an ROE of 4.63 per cent and a return on assets of 3.25 per cent on October 15.

The scrips have added nearly 80.37 per cent of growth in the past year. It closed at C$19.12 on October 14.

Also read: The Best Cryptocurrencies of 2021

Bottom line

With inflation looming, gold and base metals prices could hold steady or grow. However likely this is, it’s not a given.

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