There are a total of 191 North American listed gold stocks with a market cap of at least CAD$20 million. Since August 30th, NIA's latest gold stock suggestion Coral Gold (TSXV: CLH) has been the #3 best performer!
CLH closed last week at $0.51 per share for a gain of 30.77% from NIA's August 30th suggestion price of $0.39 per share! CLH has the most bullish chart out of all gold stocks!
With only 47.7 million shares outstanding, CLH's market cap at $0.51 per share is only CAD$24.33 million when the company has CAD$18.21 million in cash and no debt, giving CLH an enterprise value of only CAD$6.12 million (USD$4.6 million).
CLH holds a sliding-scale royalty in the Robertson gold project, which is now a part of the Cortez Mine Complex of Nevada Gold Mines, the Nevada joint venture company between the world's two largest gold miners Newmont and Barrick Gold. Robertson is immediately adjacent to the Pipeline deposit of the Cortez Mine Complex, which Royal Gold (RGLD) received a sliding-scale royalty in back in 1992. After receiving its Pipeline gold royalty, RGLD rose from $0.031 per share up to $4.125 per share for a gain of 13,206.45% within only twelve months!
The success of the Pipeline deposit led to RGLD generating significant income that it reinvested into additional gold royalties and earlier this month it reached a new record high valuation of $9.1 BILLION! Already, RGLD has showed interest in CLH and their Robertson royalty, which we believe is worth many times more than CLH's current enterprise value of only USD$4.6 million.
Even if Nevada Gold Mines never brings Robertson into production, CLH is guaranteed USD$5 million in future advance royalty payments. If Robertson does go into production, CLH in 2012 defined an inferred resource at Robertson of 2.7 million oz of near-surface gold suitable for open pit mining, which could grow significantly when Nevada Gold Mines releases its Robertson Pre-feasibility Study in the near-future. Major infrastructure already exists next to Robertson that was built for the Pipeline deposit including mills and leach pads, which will allow Nevada Gold Mines to bring Robertson into production with very low CAPEX and allow Robertson to operate with low processing costs.
If all that Robertson produces is 2.7 million oz of gold from the near-surface resource that CLH discovered, based on a gold price of $1,500 per oz, CLH could generate USD$60.75 million (CAD$80.7 million) in future royalty income, which added to CLH's cash position of CAD$18.21 million will value CLH at CAD$98.91 million or $2.07 per share.
CLH just approved a major share buyback of up to 2,950,485 common shares, which could significantly increase the future value of the company. CLH also owns 100% of three additional gold projects that are located on the Cortez trend in close proximity to the Cortez Mine Complex of Nevada Gold Mines. Look for CLH to possibly option or sell these gold projects to other companies while retaining royalties in them.
Past performance is not an indicator of future returns. NIA is not an investment advisor and does not provide investment advice. Always do your own research and make your own investment decisions. This message is not a solicitation or recommendation to buy, sell, or hold securities. Never make investment decisions based on anything NIA says. This message is meant for informational and educational purposes only and does not provide investment advice.
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