What I learned at the 2017 International Metal Writers Conference

First, women investors are a thing, and they’re growing in number to the point where they will not be denied anymore. We know this to be true, because our readers are 42% female, according to Google Analytics, but we also know it because we see it with our eyes.

In conferences past, women were a thing you hired to man a booth while the boys slapped backs, or an accessory to wear on a shoulder. They weren’t taken seriously, treated well, or considered a part of the scene – at least until they’d earned their first few million.

Yesterday, at the 2017 Cambridge House International Metal Writers Conference, the women were mucking in as investors and executives, and not before time.

My keynote speech at the show, originally titled “Five of you people are going to be dead by this time next year so we better make some new investors,” featured surprisingly few walkouts, and didn’t (as expected) end with me being beaten by walking frames.

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US Global Investors market guru Frank Holmes has been saying it was his favourite speech of the show, which is a massive compliment.

SILVER REVVING ITS ENGINE

He wasn’t the only one throwing around compliments over the last few days – John Kaiser had visited Arizona Silver (AZS.V) and reportedly slapped a $10+ buy on it, which had that company touted as the talk of the conference. It had shot up quickly over the last few days, and I’d talked to directors of the company on the conference floor about how stoked they were and eager to chat more.

That was then. This morning? Assay results were released that indicated a big fat drill miss.

Scratch that: They struck iron. And magnetite.

A black iron- and silica-impregnated sandstone intersected between 560-665 feet (171-203 metres) contained anomalous iron, copper, nickel, zinc, and vanadium. This interval bears strong similarities to the mineralized zone at the Copperstone gold deposit located about 25 miles (35 kilometres) to the northwest of the Ramsey Mine. This iron-rich interval and the lower silver-bearing interval will be analysed for gold.

A second drill hole also showed not a lot, mostly because:

Anomalous titanium (2-3 times background) suggests the unidentified fine-grained silver-black metallic mineral is ilmenite disseminated in with the magnetite and pyrrhotite. The hole was lost at 680 feet (207 metres) when the hammer broke and dropped to the bottom of the hole. As a result the hole did not go deep enough to test the detachment fault target which is the location of the Ramsey Mine silver mineralization.

So the stock cratered, leaving anyone who got in at more than a buck over the last few days reeling as their shares dropped to $0.255 by the close.

Big black eye for Kaiser, and the company, but I’m going to take the longer term viewpoint – I see this as a buying opportunity. Stay with me.

First, the stock is back where it was before the Kaiser run, so it’s unlikely it’s going to drop further, at least without more bad news: So they missed with the drill – that happens. That may mean there’s no silver to be had, but it’s just as likely it means there’s no silver where they stuck their drill.

This was two holes in a five hole batch, with one of those two involving a lost core chunk. What’s coming in the other three?

Samples from drill holes R1701, R1704, and R1705 are in the lab and being processed. Remaining drilling for this program will continue on patented ground immediately south of the silver intercepts reported previously from the 2016 drilling

So, more results are coming, and more drilling will follow – this isn’t a defunct project, it’s a reloading project.

Kaiser saw something when he went out to the rockface, something that convinced him not just to say this is a buy, but a screaming tenbagger buy. Sadly, part of what he saw was five drill holes that looked so great they were being rushed to the lab for testing.

Uh.

Over at CEO.CA, analyst Eric Coffin laid out his contrarian viewpoint:

Gotta give them credit for not pissing about. They just lay their cards on the table. It was originally a high grade operation way back in the day so maybe they have that as a backstop. I looked at it a couple of months ago and couldn’t get my head around this target, or at least didn’t feel confident enough that it would have grade to get worked up about it.

Resource Opportunities’ James Kwantes chimed in:

The transition from greed to fear and the madness of crowds in a single stock: $AZS. Good lesson to always, always take some off the table after a big run-up, esp in this sector.

I’m not saying AZS is a buy – not yet. But is a deal that was SO exciting a day ago suddenly done for on the back of one and a half drill cores? What was it that Gwen Preston (who advised folks to take profits off the table before he big drop) and Kaizer saw in this thing that was worth a $0.20 to $1.20 run, and does one dud drill run kill that?

Here’s my take, and I’m totally riffing conspiracy theories here: I think the stock got away from everyone. I think the marketing was good – but way too good – and that Preston spotted that and hedged.

I also think (total speculation here) company execs were getting concerned the stock was racing ahead of the story, and thus decided to stick a pipe in the spokes by dropping the first (weak) drill results out there, to maybe wrestle this thing back under control.

I don’t think, however, they saw an 80% stock drop coming on the back of that.

This is pure speculation, and not the sort of thing you should make a buying or selling decision on, but the fact that weak news came out before the other drill results were in, and that they didn’t sugar coat it, to me, smacks of a brake pump.

Which also tells me those next drill results are going to be real interesting. If they hit, the rules will no longer apply. And I’ll be worshiped as a god.

I might not be worshiped as a god.

Side note: Arizona wasn’t the only silver play barking at the conference. There were a lot of gold bugs around, but the loudest buzz was silver.

One of those making silver noises was Castle Silver Resources (CSR.V), which has a nice cobalt play up in Cobalt, Ontario (which has quickly become a camp of note), and also has a technology play in the lithium ion battery recycling business, but whose execs were talking out the side of their mouths that, “Hey, you know, this cobalt play used to be a silver mine and, frankly, we like silver… we might just aim in that direction.”

Take note: If cobalt demand and prices remain high and silver makes a run, EVERY COMPANY IN COBALT, ONTARIO GETS INTERESTING.

That includes Equity.Guru client companies First Cobalt (FCC.V), Cobaltech (CSK.V), LiCo Energy Metals (LIC.V), and Cobalt Power Group (CPO.V) – who Castle silver President and CEO Frank Basa told me he likes a lot as a team, and a low market cap buy in.

GOLD STORIES

Of these, there were many, some good, some meh.

Eira Thomas, who is quickly hitting legendary status after she banked a nice exit at Kaminak (KAM.V), and Stephen de Jong, who did the same with Integra Gold (ICG.V), were generous with their time and in demand.

One crew I encountered were the Secova Metals (SEK.V) gang, who gave taken longer to get their play kickstarted than a ten-year-old on a Harley Davidson. Secova were the first company we talked to at Equity.Guru, back in the day, when our site was me and an old copy of WordPress getting kicked out of a cafe in Steveston.

We’ve come a long way since. Secova?

They’re situated right alongside Bonterra Resources (BTR.V), which has been aggressively drilling and promoting. While Secova has been picking up properties, and recently raised some cash, they haven’t soiled the drills in an age. Dirty the drills, Secova!

WEED PLAYS!

There were no weed plays. Get over it, hot dog.

WAS IT A GOOD SHOW?

Yerp. I got a ton of interviews done with interesting companies, that will be rolling out on site over the coming days and weeks. Just about every interesting mining analyst I know of was there, from Holmes and Preston and Kaiser to Brent Cook, Rick Rule, Jeff Berwick, Nick Hodge, Jordan Roy-Byrne,  Zimtu’s go-to tout Stephan Bogner, Crazy Thom Calandra, Kai Hoffman from Oreninc, David Morgan, Peter Schiff, Gianni Kovacevic was doing his copper is king future is now presentation (which yours truly took part in) – there was a lot to like.

But next time, i’m getting a booth.

— Chris Parry

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