1. Newsflash: Why I’m buying this gold stock
Too often investors turn up there noses to penny stocks even if they are credible
growth stories with rock solid assets. A great example is Perseus Mining an
Australian gold junior that only two years ago traded around 25¢ per share.
Imagine that – unloved and unknown, most investors would not touch it even
though It had the all star management team and the kind of serious gold assets I
am constantly searching for. Now I think I’ve found another Perseus-like
opportunity – Read on and I think you will agree this is one penny stock that is a
very real opportunity to make us sensational profits in this ongoing gold bull
market.
Perseus Mining – what I look for : $0.25 to $3.25
The Gold bull market is just beginning - the time to buy gold juniors is now.
It is undeniable that giants like, Barrick (ABX), Goldcorp (NYSE:GG) and Royal
Gold (TSX:RGL) and Newmont Mining Corporation (NYSE:NEM) are desperate
to find new gold reserves.
2. •Goldcorp’s acquisition of Andean Resources and Yamana’s earlier takeover of
Viceroy Exploration for $515 million put investors on notice that they better act
fast to find and buy shares of undiscovered junior gold producers before its too
late.
This gold junior I believe has all the ingredients for success
•First I have taken this company to some of Wall Street’s savviest gold experts
just to confirm that I am on the right track.
•Actual asset value: its current gold reserves grosses out to $528 million worth
of gold. That’s almost $10 per share worth of gold at current prices. And there
is plenty of potential to increase this amount. Critically for us as the company
increases gold production, and upgrades its reserves its stock should move up to
better reflect this gold value – At its current $0.23 per share Its reserves are
valued at $30 per ounce – so we have plenty of upside – more than 10 times our
money.
•Starting Cash Flow: It has just begun producing gold at its (1.1 million ounces
gold reserves) Cieneguita mine and expects to dramatically grow production – a
great growth play.
• Insiders Buying: This must be what the insiders that recently took over the
company are thinking. They paid $0.20 per share for their stock – close to what
it is trading at – I like getting in near the same price as the experts.
•Huge upside demonstrated by neighbor: consider that the company’s
neighbor Glamis Gold was bought by Goldcorp for $600 per ounce and you get
an idea why they are buyers and why we should be. The current $30 per ounce
share price to a target $300 per ounce share price would be reason enough
never mind the Glamis Gold $600 per ounce.
•Industry takeovers add to potential: the recent $3.6 billion Goldcorp –
Andean Resources acquisition is an accelerating trend of gold junior takeovers –
will this company be next?.
•Track record of new control/management group exceptional: the track
record of its new management: not one or two major successes - but many. As
you learn more about these people its path to success seems more certain.
Tigers don’t change their stripes – the same people keep finding and
making fortunes for investors.
I’ll just describe two of its new executive but go to the website and you will see
the entire team has been principle in more than a dozen major resource stories.
The company is called Pan American Goldfields (OTCBB:MXOM) and its
3. president, George Young an American metallurgist and lawyer who grew up near
the giant Bingham Canyon mine is the first person I want you to know about.
George Young’s Golden Touch
Lucky or smart it was George Young that originally acquired for the above
-mentioned Viceroy, its 10 million ounce Au Guacamayo crown jewel (then
through a company called Oro Belle). Investors made a fortune that bought Oro
Belle or Viceroy because of the Guacamayo. And for that they have George
Young to thank.
After Oro Belle, George co-founded a penny stock called Mag Silver that has
been as high as $16 (now $8.42), based on its precious metals discoveries.
That’s a more than a 3,000% gain for early investors.
George’s last $0.25 a share start-up was called International Royalty Corp. (IRC).
We say was, because it was just taken over by Royal Gold for $7.45 a share.
That’s a 2,980% gain for early George backers. Think of that. Is George’s new
project (Pan American) now on its way to an IRC price of $7.45? Tigers don’t
change their stripes and were confident that George will make this into another
success story.
Another Pan Am Director Neil Maedel is well known as the early backer of
spectacular resource plays as Ultra ($0.65 to $205) and gold discoverer Arequipa
Resources ($0.57 to $32) and another more conservative “mine cycle” play –
Prime Resource Group ($1.70 to $12). Mr. Maedel has bought more than 1.5
million shares at $0.20 so what does he expect? If these very informed mine
experts are buying we should be too.
• INVESTMENT HIGHLIGHTS
• Assets: quality advanced precious metals projects; over 1 million drill
indicated and inferred (complying with regulation 43-101) gold resources;
low production costs; in a low-risk area of Mexico’s Sierra Madre
mountains where 8 other major mines have been successfully developed
and 40 million ounces have already been produced and production by
foreign companies such as Goldcorp and Barrick has continued for more
than a decade.
• Cieneguita-Gold Mine: production start-up phase. First phase underway
Est. EBITDA $12m/yr ($1200 gold) for mine. Estimated Production cost
$440/oz Au equiv.
• Mill has excess capacity; plan to increase throughput as mine develops for
initial pilot phase (underway)
4. • Ultimate planned size of 100,000 ounces annual production. The
Development of the mine to the 100,000 ounces per year is already
funded to a bankable feasibility study in an $8 million JV which is fully
funded by Pan American Partner Minera Rio Tinto. At this stage Pan
American will net 40% with a projected annual EBITA for Pan American at
$1200 gold and cash costs of $350 per ounce of $34 million net to Pan
American.
• Project being managed by Mario Ayub - Pan American’s Chairman who is
a metallurgical engineer and the former president of the National Miners
Association of Mexico. The Cieneguita will be the 8th mine Mr. Ayub has
developed in Mexico.
To learn more about Pan American Goldfields, visit
www.panamericangoldfields.org.
Undiscovered Equities is currently offering a trial subscription. For more
information please call 1-800-404-8982 or visit our website at
www.undiscoveredequities.com
Sincerely,
Kevin McKnight
101 Plaza Real South, Suite 212,, Boca Raton, FL 33432
1-800-404-8982
www.undiscoveredequities.com
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advise readers and has a history of advising readers when it judges these company’s shares should be sold. While Undiscovered Equities does its own due
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