by

Barkerville Gold Mines (CVE:BGM)… where to begin

Remember how Bre-X had a potential of up to 200 million ounces?  Well let me introduce you to Barkerville Gold Mines.  According to Barkerville’s press release, it has a “geological potential” for up to 65-90 million ounces of gold.  (Cue laughter.)

Continue reading →

Advertisements
by

Liberty Ventures: not that interesting at $40

Now that Ventures (see old writeup) is trading, it seems that its price is fair and not particularly undervalued.  (I don’t know if I made a mistake as to Venture’s cash balance and how the cash payment on the Motorola debt was handled.  Ventures may have ended up with more cash than I thought it would.)

So last time I checked, Ventures had a liquidation value of around $643M.  There are roughly 28.6M shares out Ventures outstanding (both A and B, pre-rights offering; the number may be a little off due to buybacks).  Ventures at $44.85 gives a market cap of $1.56B.  You can divide by 0.9375 to account for the dilution from the rights offering… this gives an adjusted market cap of $1.664B.

The difference between $1.664B and $0.643B can be thought of as the discount on Ventures’ various deferred tax liabilities.  That’s a $1021M discount on $2,435M of total deferred tax liabilities.  To put it another way, the market is saying that the $2,435M Ventures will have to pay in tax is worth about $1,414M right now.  (Or you can say that it is similar to $1,414M in debt with a 8% interest rate due in 7.06 years.  Or 6% interest rate debt due in 9.3 years.)

At $20-30 I will probably get interested in Ventures.  I guess I am disappointed that it is trading so high.  This memo to Liberty Interactive employees suggested a trading price of $20 for LVNTA shares (“20.0  LVNTA Market Price post-distribution”).  Damn you efficient markets.

by

Imax: short thesis

The main reasons to short Imax (in my opinion):

  1. Overvalued.  The P/E ratio is roughly 50 (higher if you ignore profits from tax-related reasons).
  2. They are close to saturating their markets and therefore Imax’s profits will start dropping in the future.
  3. Historically, the company has not made money and still has negative retained earnings.  The economics of its niche is not good.
  4. Slightly aggressive accounting that inflates profits.

I don’t think that I am the only person with this idea as Google Finance shows that Imax has 65.89M shares outstanding and the short interest has shot up to 12.2M shares short (see NASDAQ site).  That’s roughly 18.5% of outstanding shares short.  The borrow is very cheap. Continue reading →

by

Iron ore miners (mainly in the Labrador trough)

So right now I am going through the miners in the Labrador trough area:

  • Alderon (Altius Minerals owns a large stake in Alderon)
  • MFC Industrial (MIL) owns a royalty on Cliffs’ Wabush mine
  • Cliffs (CLF)
  • Champion Minerals (CHM.TO)
  • Labrador Iron Ore Royalty Corporation (LIF.UN)
  • New Millennium Iron Corp (NML)
  • Adriana Resources
  • Zone Resources
  • Oceanic Iron Ore Corp.

(I am obsessed with Altius Minerals ok?  See somebody else’s writeup on VIC.) Continue reading →

by

The Shill Report

I guess I learn something new every day.  Even the senior miners will pay money to shill companies to promote their stock.  A site called The Gold Report has a list of the companies that they cover on their front page (scroll down if you don’t see it).  There are some big names on there like Goldcorp and Nova Gold.

Disclosure: I own a lot of companies that ‘sponsor’ The Gold Report.  Northfield Capital owns Goldcorp, Premier Gold, Queenston, etc.  Altius owns Alderon and Millrock.  I own Pinetree as well (they own a few hundred stocks; chances are, many of them sponsor The Gold Report).  Sigh…