10/21/2010
December 3, 2017
10/15/2010
December 3, 2017

10/20/2010

For the past few days, I have been out of internet range on the edges of civilization following up on a very fascinating idea. We have had 2 flat tires and survived on little more than Pringles and Diet Coke. Such is the nature if real research….

My Ask Kuppy box is full. Part I will be published today, Part II tomorrow.


Have you considered the portable housing market for Mongolia?
I owned a handsomely profitable production testing/reservoir analysis company in the oil patch but I made more money leasing portable housing for drill sites. I mounted 10×30 ft.mobile homes on steel skids and contracted truckers to pick up and deliver. I would think there would be a huge demand in and around mine sites for these.

There probably is huge demand for this sort of service and it is very much along my line of thinking. If you know of someone doing this in Mongolia, I’d be excited to meet with him. The problem is that this is a very operationally intensive sort of business. Unless you really trust someone and grubstake him, it becomes quite difficult to manage it from Miami. My ideal situation is partnering with some local businesses that have already shown great success and injecting capital into them so that they can grow more rapidly.


If you’re still looking for a way to pay uranium oxide, Uranium Participation Corp. on Toronto is the way…symbol U

That is one of many ways to play it now. When I started in 2005, there was nothing at all. Just 8 juniors and Cameco.


Kuppy, have you not seen the famous quote from Bernard Baruch ? “All of my rich friends got that way by selling too soon.”

Thanks. I have seen many quotes like that. It is very much true. I have found that the biggest percentage moves happen from the low base that is created by unnatural selling or extreme low valuation. Once you get to 80% of fair value, the rest of the move might take years for the last bit of upside. I’d rather focus on finding the big percentage part of the move. For those who haven’t read it, Bernard Baruch’s book is one of the best books ever written on the market. I’ve read it a few times now.


Any comment on the Invicta update?

Welcome to mining…. Next month something else will go wrong, and then the month after, there will be some sort of other delay. Then when it’s all fixed, something else will cost more than expected. Then you will get diluted by a few percent and then the process starts anew. There’s a reason why the shares are valued at less than one times what I think steady state annual cash flow will be. It also creates the opportunity. If you think they build this mine roughly on target, it doesn’t matter if it happens a quarter or a year behind schedule. If you think they bungle their way along and destroy value along the way, then maybe the current price is correct price because I think that they can sell the project to someone else for a bit more than where it is trading today. I think this is just an ‘unexpectedly’ expected delay. The shares didn’t even drop, hence others thought similarly.


Are you surprised by SRK’s analysis of Invicta not being “bankable”?
Thanks by the way on your stories out there in the world (i.e Mongolia) ;very interesting.

You need to re-read the press release. What they said was that they didn’t think the current feasibility was sufficient to claim that the project was bankable. A year ago, the company tried to do a fatal-flaw report (the feasibility mentioned). They hoped that it would be sufficient for the banks to fund it. Based on conversations with people in the industry, I was pretty vocal with management that I didn’t think this would be the case. Unfortunately, I’ve been proven correct. Now they are going to do a true bankable feasibility study. David Rae started that process as soon as he joined the company and this press release is just a clarification that they are moving ahead with the full bankable feasibility. If done right, this will be sufficient for the banks to finally fund Invicta. What’s a few months of delay in the scheme of things? Just to clarify, the press release said nothing about invicta not being bankable. It’s just a paper chase so the banks feel confident.


Hello Comrade,
lets assume AAG get bought out at $2.5, far short of our, say, 5 price target. Would you recommend
using this insider buying signal in order to purchase some other junior miner stocks. Perhaps we even could capture a large move
without being fully invested all the time. Would you recommend picking more Jr. miners solely based on price action, volume, and insider purchases?

Let’s not get ahead of ourselves. There’s a long road to travel from today until $2.50…. Insider buying is a great way to search for attractive opportunities and to validate your own thinking if insiders put their money up to buy more shares. If I had to choose between price action, volume or insider purchases, it wouldn’t even be debatable. I’d buy a basket of what the insiders are buying. Remember, investing in junior mining is very tough. Unless you know what you’re doing, you are going to get burnt. Caveat Emptor!!


Thanks for providing this blog. Could you share or recommend some of your sources / publications for insider trading information.

Please use search. Insiderinsights.com and inkresearch.com are the two that I use. I’m sure there are plenty more out there.


Harris,
I’m sure you’ve seen this release, but I thought it was worth sharing with your readers. Apex is making progress, but their efforts to increase production and lower their cash costs are in a race against the rising Aussie dollar.
Here’s the latest release from the company: http://www.apexminerals.com.au/reports/ASXAnnouncement201010-September2010Quarterlyproductionhighlights.pdf

I just looked when I got back to civilization. I am slowly getting a better feeling about this company. I’m no longer worried about Wiluna. I’m merely concerned. I am passing this along to readers who may be following the saga. For what it’s worth, I bought a few more shares at 1.9 cents recently.