Fabrice Taylor Wesdome Gold Mines Ltd. WDO-T COMMENT Sep 09, 2016

Has gone through trials and tribulations, but a lot of it is related to the Cdn$ as well as some mining issues in both their mines. Things are now stabilizing. Have had some good exploration success at Eagle River.

Has a gold mine in Quebec, which is a great jurisdiction and has been having some very good drill results. Trading close to a 10X PE. Very cheap.

2 mines in production in Ontario and Quebec and makes very good money. Pays a dividend and has a market cap of about $250 million that is in line with half of the companies that he doesn't think will ever be in production. Has confidence in the new management.

Old mine in Quebec. Fair value is $4 but because it’s a small company, he would bring it down to $3. Weak buy but with where gold is going it could move into the $3 range.

They are turning themselves into a mid-tier producer of gold. They have invested into exploration of another significant mine that could result in a very positive reserve assessment. They found some interesting high-grade zones in the new mine. Their long term Eagle mine is also able to expand. Yield 0%. (Analysts’ price target is $5.28)

(A Top Pick Jan 30/19, Up 85%) They have the market's attention. Later this year there is the decision whether they start up an older mine that has been mothballed for a while.

Domestic production is always better than international, especially for an emerging mid-size producer like this one. Gold should have done better in this inflationary environment, but crypto stole its thunder. Gold will continue to be a store of value with steadier growth, especially as world currencies devalue with inflation.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research.

EPS of -2c slightly missed estimates. Revenue of $75M missed estimates by 10%.
EBITDA of $21.3M missed by 8%.
Gold sales fell 16% yet all-in costs rose 18%. 2023 forecast is for 120,000 ounces, up from 111,000. Its problems are not unique as costs continue to rise.
But we need to see better production growth to offset it. If production grows 10% and costs rise 18%, it is going backwards.
We think it is OK generally, and the balance sheet is fine.
But it is hard to make a strong case for keeping it this year.
It is a bit expensive (because earnings have declined).
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Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research

WDO has a 'bouncy' history but certainly momentum is quite strong right now. The balance sheet is solid and it is growing nicely. For mid-cap sector exposure, we would be OK buying today. 
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