Peter Imhof
Desert Sun Mining Corp
DSM-T
BUY
Aug 29, 2011
A lot of plays on rare earths but not much production and he prefers seeing revenues and earnings. This one is trading at a huge discount to NAV of about $1.70. Have been buying back a lot of shares.
Has always been somewhat sceptical. Thinks it is a difficult mine and doesn't know what the costs are going to be. Would prefer Orvana Minerals (ORV-T) which is of a similar ilk, good management and has been in production in Bolivia for a couple of years and throwing off good earnings.
Has always been somewhat sceptical, but was impressed with the person who moved in as the operating guy. The stock will participate in a better gold environment.
His 3 picks today are small and chosen because they are very close to their break-out points and they are all in the mining/oil sector as well as being low priced. Broke above the 200 day moving average. A gold stock, so is in the right area, right price.
Brazilian operation so some risk with exchange rates. A lower grade mine. Producing just over 100,000 ounces a year at about $220 an ounce. The upside here will be through exploration. Under valued.
The Desert sun will be an emerging mid tier gold producer. Won't see the kind of growth we've seen over the last year. But it will be a more staid growth.