2 Gold stocks that remain at huge discounts.
Much of the sector had breakouts this week, but there is still alot of value to unlock in the many of the names.
Treasury Metals - Market Cap $38 Million Canadian
The valuation of this stock really amazes me and it sums up just how hated the sector was for a long time. The stock had a great week, and broke out of it’s base on massive volume. This isn’t just another exploration stock, although it’s priced like one. Treasury Metals is a gold developer with a resource approaching 3 million ounces in Ontario, they are going through the process to get this mine into production.
This is cyclical bottom investing just as the sector begins to inflect, at a $1950 gold price this project has $493 million Post-Tax NPV5% and IRR of 33%. The company is trading at a massive discount right now. The company just raised $4 million in December, so you shouldn’t have to worry about dilution right now, The company is working towards it Feasibility Study, after completing it’s PFS last year.
Newcore Gold - Market Cap $31 Million Canadian
Another beaten up stock just waking up its out of it’s slumber, the stock was an early mover in late February but has just been in consolidation mode recently even as the gold price shoots higher.
Newcore Gold has a resource of over 1.5 million ounces in Ghana, at the low grade of .5g/t Au, but the economics look strong and with huge potential to add to the resources. The resource is oxide and shallow and will be an open pit, heap leach type of operation. These always have very nice economics.
The company completed a PEA in 2021, which it is in the process of updating right now, it will include the new resource estimate into it which was completed in 2023. Even if we look at the results of the 2021 PEA, the company has an an After tax NPV5% of $473 Million Canadian at the price of $1950 gold. This is set to get even better soon.
This is another example of getting in close to a cycle bottom right when the sector starts to inflect.
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You ever looked at $TRE.AX?
They have a 2.4Moz resource @ 0.86g/t in Mali. (so its low grade but most of it near surface)
AUD12M market cap. DFS from 2021 (back then they were called African Gold Group)
Currently updating the DFS.
Would like to hear your opinion on this.
The bull market will rise all boats but we want those that have the most leverage and ideally limiting risks.
thanks!
2021 DFS link:
https://www.africangoldgroup.com/news/african-gold-group-announces-updated-dfs-with-66-reserve-increase-and-100-koz-per-year-for-the-first-10-years
Do you take into account Initial CAPEX in relation to their post tax NPV? Treasury Metals seems a big high. Seems you get more bang for your back with Newcore.