Kirkland Lake Gold (KL.TO)

A well-run mine. They have turned operations around, but the stock has given him an awful lot awfully fast. Still owns a reasonable amount of this because of his respect for the management.

A producer in Northern Ontario with 320,000 ounces a year. They just bought St. Andrews Goldfields, a company that was perpetually starved for capital. They are just digesting those assets now, and thinks they are going to come out with greater financial resources and balance sheet. He also likes the main assets in the Macassa mine, which has grade that goes up as they dig deeper. Over the next 2 years you are going to see the head grades go from 15 g a ton to 18 g a ton. As grades go up, all things being equal, the cash flows going to go up. He sees cash flow expanding by about 15%. Have just had a sudden CEO departure. Rumours are that there was a rift between the CEO and the Board as far as M&A and strategic direction. That has worried a lot of investors which has really weighed on the shares.

(Market Call Minute.) Great management team that has excellent operational experience. They’ve really delivered. Have improved the quality of the gold they are getting.

He has not followed it closely over the last year or so, but his previous employer has gone into it big. The grades are getting better. He likes this story. The Canadian dollar is a bit of a headwind compared to before. He holds other names.

It broke out and has some pretty nice upside. The target is short term - $12.50

This is a wonderful deposit. The company has done everything right in terms of optimizing their operations. Their mine is in greater Timmins. He sees a shift in investor sentiment and people moving from Lakeshore gold to this one.

Wait for a pullback. It is an underfunded project taken over by a new management team. Now they continually beat guidance, but it will go higher because of consistency of results and a higher gold price.

(Market Call Minute.) New CEO. Doing all the right things. Will take a bit of time, but he likes it.

A cheap stock, but it is cheap for a reason. The area where they are mining has historically been a tough district. Have had a lot of operational issues over the years. Prefers others.

Ontario is a safe jurisdiction. Has been some time increasing the shaft which can hoist about 3000 tons, up from about 1200 tons. They have a new management team in place. Hasn’t done it yet, but feels they are going to get close to that tipping point where this thing can make an awful lot of money. Very high-grade north of .4 ounces a ton.

Cost just got devalued because of currency drop. Gold Corp. is bidding for OSK. It means Gold Corp. is fine with gold companies’ valuations. This is a very special mine in the industry. Believes it will be taken over.

(Market Call Minute.) A higher risk sort of name. New CEO. There will be a lot of new plans coming out. Has heard that they are high grading the mine and he is very encouraged with what he is seeing. Still a fair amount of risk.

(Top Pick Nov 16/12, Down 74.10%) Management stumbled several times and stock is in the penalty box. By end of November, they had a large royalty deal, but they had under delivered. There has been a management change. New Management is very capable. He thinks it is officially cheap. He is sticking with it. Nothing wrong with the company.

Visited mine earlier this year. Has been around for 80 years. High Grade. Had a longer ramp up compared to others this decade. They had to train a work force. Increased hoisting capacity to get more waste and ore out of the mine. They are expanding their mill. Are addressing every issue they have. Thinks they will get through.

(Market Call Minute.) High cost mine. Have been trying to increase production for over 2 years. Margins are going to get squeezed.