The junior gold mining space is red hot. The VanEck Vectors Junior Gold Miners ETF (NYSEARCA: GDXJ) is up as much as 225% since March. Gold is up almost 25% as the best performing major asset so far in 2020 when compared to government bonds, corporate bonds, global equities, cash, junk debt, and the broad commodities space.
Why? The historic volatility and money printing we are seeing, in tandem, right now due to the world’s confrontation with the pandemic health crisis, as well as political uncertainty and unprecedented stimulus.
According to Bank of America/ML analysis, we have already seen over $21 trillion in the monetary and fiscal stimulus around the world this year. To say that dwarfs the historical record would be like saying the sun dwarfs a flashlight. It’s not remotely comparable to anything we have ever seen.
Last week alone, we saw $19.5 billion flow out of cash holdings in a flight from paper money. Gold has so far offered the only port in the storm. As this correction in the gold market resolves into a potential next leg higher back above the $2000/oz area, speculators are likely to move to where the gains stand to be biggest, which is the junior mining stocks.
With that in mind, we take a look at some of the most interesting active names in that space, including NovaGold Resources Inc. (NYSEAMERICAN: NG), Eldorado Gold Corp (NYSE: EGO), Emgold Mining Corporation (OTC: EGMCF), and Pretium Resources Inc. (NYSE: PVG).
NovaGold Resources Inc. (NYSEAMERICAN: NG) promulgates itself as a company that primarily explores for and develops gold mineral properties in the United States.
Its principal asset is the 50% interest owned Donlin Gold project consisting of 493 mining claims covering an area of 71,420 acres located in the Kuskokwim region of southwestern Alaska.
NovaGold Resources Inc. (NYSEAMERICAN: NG) recently released its 2020 third-quarter financial results and an update on its flagship Donlin Gold project, a Tier One1 gold development project located in Alaska, a mining-friendly jurisdiction, which NOVAGOLD owns equally with Barrick.
According to the release, details of the financial results for the quarter ended August 31, 2020 are presented in the consolidated financial statements and quarterly report filed September 30, 2020 on Form 10-Q with the SEC that is available on the Company’s website at www.novagold.com, on SEDAR at www.sedar.com, and on EDGAR at www.sec.gov. All amounts are in U.S. dollars unless otherwise stated and all resource and reserve estimates are shown on a 100% project basis.
Despite the clear impact, this revelation hasn’t been able to hold off sellers, with shares of the stock suffering from clear pressure over the past week, dropping by roughly -7%.
NovaGold Resources Inc. (NYSEAMERICAN: NG) had no reported sales in its last quarterly financial data. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($164.6M against $4.1M).
Eldorado Gold Corp (NYSE: EGO) engages in the exploration, discovery, acquisition, financing, development, production, sale, and reclamation of mineral products, primarily in Turkey, Canada, Greece, Brazil, and Romania.
The company primarily produces gold, as well as silver, lead, zinc, and iron ore. It operates five mines: Kisladag and Efemcukuru located in western Turkey, Lamaque in Canada, and Olympias and Stratoni located in northern Greece.
Eldorado Gold Corp (NYSE: EGO) recently announced that Dr. Michael Price will be stepping down from the Company’s Board effective September 30, 2020. As previously announced on July 20, 2020, Judith Mosely joined the Board effective September 1, 2020. This is consistent with Eldorado’s succession planning at the Board level. The Company also reports that it has completed the redemption of $58.6 million of its senior secured notes. The Company announced that it had issued a redemption notice for these notes on July 30, 2020.
“On behalf of Eldorado and the Board of Directors, I would like to thank Mike for his ten years of service and substantial contributions to the Company. I would also like to welcome Judith to the Board,” said George Burns, President, and CEO. “We are also pleased to announce the closing of the redemption of $59 million of our senior secured notes, which demonstrates our continued commitment to reducing our debt.”
That news was unequivocally positive for the stock. As it stands, EGO is pushing higher, logging roughly 6% in gains over the past five days of trading activity. Shares of the stock have powered higher over the past month, rallying roughly 5% in that time on strong overall action.
Eldorado Gold Corp (NYSE: EGO) pulled in sales of $348.8M in its last reported quarterly financials, representing top-line growth of 48.8%. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($606M against $515.9M).
Emgold Mining Corporation (OTC: EGMCF) promulgates itself as a gold exploration and mine development company that explores for and develops mineral properties in western Canada and the United States. It explores for gold, silver, molybdenum, tungsten, lead, copper, zinc, and other mineral deposits.
The company has extensive mining assets, including 100% interests in the Golden Arrow property consisting of 357 unpatented and 17 patented lode mineral claims covering an area of approximately 7,050 acres; the Buckskin Rawhide East property comprising 48 unpatented mineral claims covering an area of 960 acres; the New York Canyon property consisting of 21 patented mineral claims and 60 unpatented mining claims covering an area of 1,500 acres; the Mindora property comprising 12 unpatented and 18 unpatented mining claims; the Buckskin Rawhide West consisting of 21 mineral claims; and the Koegel Rawhide property comprising 36 unpatented lode claims covering an area of 720 acres located in Nevada, the United States.
It also holds 100% interests in the Casa South property consisting of 180 mining titles covering an area of 10,061 hectares located in Quebec, Canada; the Stewart property comprising 28 mineral claims totaling 5,789 hectares located in British Columbia; and the Rozan property consisting of 32 mineral claims totaling 1,950 hectares located in the British Columbia. In addition, the company holds a 50% interest in the East-West Property located in Quebec.
Emgold Mining Corporation (OTC: EGMCF) also just announced that it has commenced fall/winter exploration activities on its Mindora Property, NV.
The Company’s strategy is to organize, review, and analyze substantial historic exploration data from the past operators using the latest methods, locate collars of historic drill holes in the field, conduct surface geologic and structural mapping, conduct geophysics (IP and magnetic surveys) on the property, conduct geochemical surface sampling, using the above date, design and permit a reverse circulation drill program to twin historic drill holes and test known mineralized zones, conduct the drill program, and model historic and modern exploration data.
EGMCF shares have been strong outperformers in the space since March, up nearly 200% in that time, with rising volume and liquidity accompanying the move.
Emgold Mining Corporation (OTC: EGMCF) is still in exploration and development stage operations, but it has a number of promising assets and avenues in front of it and may represent a very worthwhile prospect for speculative interest and consideration as it moves toward more tangible catalysts.
Pretium Resources Inc. (NYSE: PVG) acquires, explores, and develops precious metal resource properties in the Americas.
The company primarily explores for gold, silver, and copper deposits. Its principal project is the Brucejack project that consists of 4 mining leases and 6 mineral claims covering an area of 3,305.85 hectares located in northwestern British Columbia. It also owns 100% interest in the Snowfield project consisting of 1 mineral claim covering an area of 1,217 hectares located in northern British Columbia.
Pretium Resources Inc. (NYSE: PVG) most recently announced that Tom S.Q. Yip, Executive Vice President, and Chief Financial Officer, will step down from his role as Chief Financial Officer of the Company on September 30, 2020. Mr. Yip will continue to serve as Executive Vice President and assist with an orderly transition until October 30, 2020. Matthew Quinlan, Vice President, Finance, will succeed Mr. Yip as Chief Financial Officer of the Company effective September 30, 2020. Additionally, Pretivm announces that Kenneth C. McNaughton, Vice President, and Chief Exploration Officer, has informed the Company that he will be retiring effective September 30, 2020.
According to the release, Mr. McNaughton has been responsible for Pretivm’s greenfield exploration programs since joining the Company in 2011, shortly after it was formed to advance the early exploration-stage Brucejack Project. He had led the exploration programs for both the Brucejack and Snowfield projects prior to their acquisition by Pretivm and had been responsible for the exploration program in 2009 when bonanza-grade drilling results established Brucejack as a high-grade gold discovery. Most recently, Mr. McNaughton led Pretivm’s team responsible for the Bowser regional exploration program.
While this is a clear positive, it hasn’t been enough to shift the tone of recent action, with PVG shares sinking something like -4% in the past week.
Pretium Resources Inc. (NYSE: PVG) managed to rope in revenues totaling $228.2M in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top-line growth of 56.3%, as compared to year-ago data in comparable terms. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($169.9M against $170.5M, respectively).
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