Opinions
James Hodgins
Trevali Mining Corp
TV-T
DON'T BUY
Aug 28, 2018
$0.800
Stock price when the opinion was issued
Mining
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HOLD
It has really been crushed since the big financing on the stock. Now is probably the time to buy it. They had a lot of operational problems in their mine, but they have turned over the management team yet the stock continues to go down. He started to buy at $0.45. He would hold on. Don't sell.
Mining
BUY
The biggest independent zinc producer has had its ups and downs. The new CEO has to navigate 2020, which was tough. Zinc prices have jumped to US$1.25/lb. TV's cost structure is based on $1.10-1.15. TV trades at a deep discount. Zinc doesn't capture the imagination like copper or nickel, though. Zinc prices have benefited from the rebounded in car production and other industrial activity. He has owned this in the past. A good company for pure zinc exposure.
Mining
This is a classic potential value trap. It looks very cheap on a short-term basis but the assets that it has are not low-cost assets. However, of the base metals, he is most bullish on zinc. This is a good way for someone to take a levered position on zinc, but he thinks base metal fundamentals are challenged now. The trend for base metals seems to be downward, and there was a huge stocking up of inventories of base metals back in the spring, especially on the Shanghai exchange, and that still has to be unwound. He was generally short base materials in the Spring but is neutral now. He is still short the renewable energy materials, lithium and graphite, because he thinks the market is expecting the infrastructure that will use these to be built out faster than it will actually be built.