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Lebed.biz Alert ***My Top 10 Picks for 2010***
Posted on 31 December 2009 by admin
I am extremely excited to announce my Top 10 Picks for 2010!
10) Hecla Mining (HL), currently $6.18
HL is a repeat from my last top 10 list. HL's financial situation has completely turned around from a year ago. HL reported net income last quarter of $22.5 million on revenue of $95.2 million compared to a loss of $7.2 million on revenue of $68.5 million in the year ago quarter. Their cash position increased by $27 million to $85 million from the previous quarter in 2009. This was one of HL's best quarters in their hundred-year history. HL is now the U.S.'s largest silver producer and second and third largest producer of zinc and lead, respectively.
9) NGAS Resources (NGAS), currently $1.70
NGAS is a bet on a future recovery in natural gas prices. NGAS's revenues were down last quarter by 53% over a year ago due to lower natural gas prices, but NGAS increased production by 5% to 1 Bcfe and reduced their debt during the quarter by $45 million. NGAS is well positioned to prosper when natural gas prices inevitably rise once again in the future.
8) Copper Mountain Mining (TSX: CUM), currently $2.08
CUM sold 25% of their Copper Mountain Project in 2009 to Mitsubishi for $28.75 million. CUM ended the last quarter with a huge cash position of $54.2 million. CUM has placed orders through SMS Equipment for more than $70 million worth of Komatsu mobile mining equipment to be delivered in stages over the next 18 months. Preproduction mining is scheduled to start in June 2010. CUM is almost done pouring the concrete foundation for their mill in preparation for the erection of the building steel in the spring of 2010.
7) First Majestic Silver (TSX: FR), currently $4.07
FR recently reported a 30% increase in 3Q silver production to 1,089,481 silver equivalent ounces and a 22% increase in 3Q revenues to $16.8 million. GPR's cash operating costs were down 27% to $5.56 per ounce and they reported a 141% increase in mine operating earnings to $4.1 million. FR's new La Encantada plant is expected to increase production significantly, up to approximately 6.3 million silver equivalent ounces in 2010.
6) Entree Gold (EGI), currently $2.43
EGI is another repeat from my last top 10 list. EGI's joint-venture partner Ivanhoe Mines (IVN) and largest shareholder Rio Tinto (RTP) both signed the long-awaited Oyu Tolgoi Investment Agreement with the Mongolian government in October of 2009. This sets the stage for potential future development of EGI's Lookout Hill portion of the Oyu Tolgoi project, which contains the Hugo North Extension and Heruga deposits. Oyu Tolgoi is the world's largest and richest, undeveloped porphyry copper-gold-molybdenum project.
5) Capital Gold (CGLD), currently $0.891
CGLD's net income last quarter was up 52% over a year ago to $2.939 million. CGLD is now trading with a trailing P/E ratio of less than 16. CGLD is almost done constructing their new leach pad and installing their new crushing and screening module, which are both expected to be operational in January, increasing CGLD's annual production capacity to 70,000 ounces of gold. CGLD recently increased their proven and probable gold reserves by 64.7% to 1,504,000 ounces.
4) Silvercorp Metals (SVM), currently $6.60
SVM is my latest speculative rating of 1 pick. SVM is the largest and lowest cost primary silver producer in China. SVM produced 1.2 million ounces of silver last quarter at a cash cost of negative $6.33 per ounce. SVM has $79 million in cash and no long-term debt. SVM is working to grow its resource base through exploration and acquisitions.
3) DRDGOLD Ltd (DROOY), currently $6.84
DROOY was my #1 pick on my last top ten list and after initially surging 197% in early 2009, DROOY underperformed later in the year after an earthquake damaged their Blyvoor mine and its workers went on strike for several weeks. DROOY recently sold 60% of their Blyvoor mine to Aurora Empowerment Systems for 296 million rand or about $40 million and Aurora agreed to provide the mine with a capital facility of 80 million rand. Aurora's funding will allow the Blyvoor mine to get back to producing high grade gold and DROOY now has the cash needed to boost production of their Crown surface treatment facilities, which have the potential to double the ore processed from 1.2 million to 2.4 million tonnes per month.
2) Bullion Monarch Mining (BULM), currently $0.68
BULM has a royalty agreement with Newmont Mining (NEM) to receive a 1% royalty on NEM's Leeville/East Ore mine. BULM recently reported record quarterly royalty revenue of $1,378,135 with record net income for the quarter of $655,000. If you annualize BULM's net income last quarter you get $2.62 million. BULM's current market cap is only $26.31 million giving it a P/E ratio of 10 based on last quarter's net income annualized.
1) Great Panther Silver (TSX: GPR), currently $0.88
GPR recently reported a 34% increase in 3Q silver production to 597,057 silver equivalent ounces and a 104% increase in 3Q revenues to $8.9 million. GPR's cash operating costs were down 62% to $5.48 per ounce and they reported a record $5 million in quarterly earnings from mining operations. GPR has a three-year strategy to accelerate annual production to 3.8 million silver equivalent ounces and increase NI 43-101 compliant resources to 40 million silver equivalent ounces. I consider GPR to be the most undervalued silver producer with the greatest upside potential.
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My firm Lebed Biz LLC was compensated by a third-party (B&D Capital Partners) $20,000 cash for a one-month CUM investor relations contract which has since expired. We could potentially be compensated more for providing investor relations services regarding CUM in the future, although no agreements have been made at this time. My firm Lebed Biz LLC was compensated by a third-party (B&D Capital Partners) $20,000 cash for a one-month GPR investor relations contract which has since expired. We could potentially be compensated more for providing investor relations services regarding GPR in the future, although no agreements have been made at this time. We could potentially be compensated for providing investor relations services regarding BULM in the future, although no agreements have been made at this time. Never invest into a stock we discuss unless you can afford to lose your entire investment. For our full disclaimer go to: www.lebed.biz/disclaimer.htm
Jonathan Lebed
Lebed.biz
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