Analysts’ Ideas Of The Week


equity market


  1. More reasons for the Fed to turn dovish
  2. Positive news for fertilizer stocks
  3. Why we anticipate a relatively subdued Q3 for crypto exchanges
  4. India and Canada’s central banks have opposing views on Central Bank Digital Currencies (CBDCs)
  5. What triggered the rise in Cannabis stocks last week?

FRC Top Picks

The following table shows last week’s top five performers among our Top Picks, including four junior resource companies, and an oilfield services company. The top performer, E3 Lithium (TSXV: ETL), was up 13.4%. ETL is advancing a large lithium project in Alberta towards production. Our prior reports can be viewed here.

Top 5 Weekly PerformersWoW Returns
E3 Lithium Limited (ETL.V)13.4%
World Copper Ltd. (WCU.V)8.3%
Hot Chili Limited (HHLKF)4.9%
Starcore International Mines Ltd. (SAM.TO)4.2%
Enterprise Group, Inc. (E.TO)2.3%
* Past performance is not indicative of future performance (as of September 05, 2023)

Companies on our Top Picks list are up 11% on average since we initiated coverage vs -33% for the benchmark (TSXV).

AIW Top Picks
Total   Return1 Week1 mo3 mo6 mo3 yrSince launch
Special Situations (MIC)-0.6%-3.5%-1.4%-23.3%38.5%-23.7%
Private CompaniesN/AN/AN/AN/A20.5%30.5%
Portfolio (Total)-3.1%-8.8%-10.9%-15.4%-0.4%11.2%
Benchmark (Total)1.0%-4.6%-2.6%-2.6%-19.0%-33.0%
Portfolio (Annualized)-----0.1%1.1%
Benchmark (Annualized) -----6.8%-4.0%

1. Since the earliest initiating date of companies in the list of Top Picks (as of September 5, 2023)
2. Green (blue) indicates FRC’s picks outperformed (underperformed) the benchmark.
3. Past performance is not indicative of future performance.

Our complete list of top picks (updated weekly) can be viewed here.

Weekly Mining Commentary

Last week, global equity markets were up 1.6% on average (up 0.9% in the prior week). Equity markets have been trending higher due to cooling inflation and weaker global economic data, favoring a dovish stance by central banks. In today’s meeting, the Reserve Bank of Australia maintained its rate for the third consecutive month. We anticipate that the Fed will keep its rate steady in its upcoming meeting this month, given the recent uptick in both labor participation and unemployment.

AIW Top Picks

Source: FRC/Various

Last week, metal prices were up 0.2% on average (up 3.8% in the previous week).


Valuations of gold producers were up 0.1% last week (up 5% in the prior week); base metal producers were up 5% last week (up 2% in the prior week).

gold producer
base metals
 Gold ProducersEV / R   (forward)EV / EBITDA (forward)EV / R (forward)EV / EBITDA (forward)
4Agnico Eagle3.807.743.867.86
5AngloGold 1.905.611.825.33
6Kinross Gold 1.934.822.004.97
7Gold Fields2.735.242.695.20
9Hecla Mining3.8814.083.9114.19
13Eldorado Gold1.814.281.934.58
 Average (excl outliers)2.485.692.505.64
 Base Metal ProducersEV / R   (forward)EV / EBITDA (forward)EV / R (forward)EV / EBITDA (forward)
1BHP Group 2.955.843.136.19
2Rio Tinto2.084.702.214.99
5Anglo American1.424.221.484.38
6Teck Resources2.515.792.626.06
7First Quantum3.318.453.569.10
 Average (excl outliers)1.995.482.105.77

We are maintaining our metal price forecasts.

FRC Forecasts
Current Price2023E Long-Term (2025+)
Gold (US$/oz)$1,928$1,900$1,400
Silver (US$/oz)$23.64$22.50$18.00
Copper (US$/lb)$3.85$3.70$3.00
Zinc (US$/lb)$1.11$1.25$1.10
Nickel (US$/lb)$9.39$10.00$8.00
Source: FRC

Source: FRC

A key sector development is listed below (positive):

– The Argentinean government announced that it has attracted interest from several parties for a US$1B investment to advance a government-owned potash project towards production. Prior to 2012, Vale (NYSE: VALE) had invested US$2B+ in this project. We believe this strong interest is a compelling testimonial for fertilizer projects. Notable fertilizer companies under coverage include Verde AgriTech, Millennial Potash, and Chatham Rock Phosphate.

Updates from Resource Companies Under Coverage

Millennial Potash Corp. / TSXV: MLP

PR Title

Potash mineralization intersected in the extension of BA-002 (Gabon); cancels private placement

FRC Opinion

Negative – An ongoing drill program confirmed potash mineralization along depth. However, MLP has cancelled a previously announced private placement, amid heightened political unrest in Gabon, following a military coup. MLP has confirmed that there have been no reports of unrest within or in close proximity to its project area. We will closely follow the situation, and provide insights accordingly.

Eskay Mining Corp. / TSXV: ESK

PR Title

Drills VMS mineralization at four new targets at its Eskay project, Golden Triangle, B.C.

FRC Opinion

Positive – Promising results; An ongoing drill program has confirmed VMS mineralization in four out of seven targets, supporting the project’s potential to host additional deposits. As VMS deposits typically occur in clusters (1-20 Mt), we believe that individual deposits have potential for forming mining districts/camps.

Churchill Resources Inc. / TSXV: CRI

PR Title

Acquires a 100% interest in Taylor Brook properties (Newfoundland)

FRC Opinion

Positive – CRI has exercised its option to acquire a 100% interest in its flagship Taylor Brook nickel-copper-cobalt-PGE project. We believe this property has potential for district-scale mineralization, with high-grade nickel, plus copper and platinum.

Financials, Technology, Energy, and Special Situations

Elixinol Wellness Limited/ ASX: EXL 

PR Title

Reported H1-2023 results

FRC Opinion

Neutral – H1-2023 revenue was up 7% YoY, and EPS improved from -A$0.02 to -A$0.01. Revenue growth came from EXL’s flagship subsidiary Hemp Foods Australia. Products are distributed through major outlets such as Costco (NASDAQ: COST), Woolworths (ASX: WOW), and Coles (ASX: COL). Although H1 revenue was lower than our estimate, EPS was in line due to EXL’s cost-cutting initiatives. We will publish an update shortly.

Weekly Crypto Commentary

Prices of mainstream/popular cryptos were down 6% on average last week (up 0.2% in the previous week).

September 5, 2023
Binance Coin-12%-5%-22%

Source: FRC/Yahoo Finance

The global MCAP of cryptos is US$1.04T, down 11% MoM, but up 5% YoY.

total crypto

Source: Coinmarketcap

Companies operating in the crypto space are trading at an average EV/R of 6.9x (previously 6.3x).

EV/R of Crypto Companies

ev r of crypto

Source: S&P Capital IQ/FRC

September 5, 2023
Crypto CompaniesTickerTEV/Revenue
Banxa HoldingsTSXV: BNXA0.5
BIGG DigitalCSE: BIGG12.6
Canaan Inc. NASDAQ: CAN0.6
Coinbase GlobalNASDAQ: COIN6.5
Galaxy Digital HoldingsTSX: GLXYN/A
Hive Blockchain TechnologiesTSXV:HIVE3.8
Marathon Digital HoldingsNASDAQ: MARA15.7
Hut 8 Mining Corp. TSX: HUT8.2
Riot BlockchainNASDAQ: RIOT6.9

Source: S&P Capital IQ/FRC

Key sector developments are listed below (mixed):

– Global Bitcoin trading volumes are down 17% in this quarter compared to Q2 (Source: Yahoo Finance). This leads us to believe that Q3 could be relatively subdued for crypto exchanges.

– A Pennsylvania-based crypto mining company is seeking approval to burn tires as an energy source for mining. In light of the current emphasis on energy conservation and efficiency, we believe such outrageous initiatives could have a detrimental effect on the public perception of crypto mining activities.

India’s central bank is advocating for Central Bank Digital Currencies (CBDCs) as a solution to high-cost/low-speed cross border transactions. Although we share the same viewpoint, it contradicts a recent study by the Bank of Canada (BoC) highlighting the lack of incentives for Canadians to embrace a CBDC.

Weekly Cannabis Commentary


Cannabis Industry Performance

September 5, 2023

Source: FRC/Yahoo Finance

Last week, U.S. cannabis stocks outperformed their Canadian peers (65% vs 12%). Cannabis stocks soared as the U.S. Drug Enforcement Administration announced a review of cannabis classification, in response to the Department of Health and Human Services’ call to ease regulations on cannabis use.


Canadian cannabis stocks are trading at a 1% discount on average (previously 5% premium) relative to their U.S. peers.

Aug 28, 2023Sep 05, 2023
Canadian CompaniesTickerTEV/RevenueTEV/EBITDATEV/RevenueTEV/EBITDA
Aurora Cannabis Inc.TSX: ACB1.1NM1.2NM
Canopy Growth Corp.TSX: WEED2.3NM2.7NM
Organigram Holdings Inc.TSX: OGI0.6NM0.7NM
Tilray Inc.NASDAQ: TLRY2.9NM3.7NM
U.S. CompaniesTickerTEV/RevenueTEV/EBITDATEV/RevenueTEV/EBITDA
Cresco Labs Inc. OTC: CRLBF1.
Curaleaf Holdings Inc. OTC: CURLF2.316.62.820.1
Green Thumb Industries Inc.OTC: GTBIF2.
Trulieve Cannabis Corp.OTC TCNNF1.
Implied Premium (Canada vs U.S.) (Average)5%-1%

Source: S&P Capital IQ, FRC

                                                                                       Average EV/R


Source: S&P Capital IQ, FRC

Psychedelic Industry Performance

Psychedelic stocks were down 2% on average last week (down 3% in the previous week).

September 5, 2023
Atai Life Sciences N.V.-44%-5%-65%
COMPASS Pathways plc13%-1%-42%
Cybin Inc.-25%1%-68%
Delic Holdings Corp.-87%122%-88%
GH Research5%-12%-26%
Mind Medicine Inc.33%2%-56%
Numinus Wellness Inc.-9%3%-49%
Seelos Therapeutics Inc.51%-2%-3%

Source: TMX Money, FRC

Disclaimers and Disclosure

The opinions expressed in this report are the true opinions of the analyst(s) about any companies and industries mentioned. Any “forward looking statements” are our best estimates and opinions based upon information that is publicly available and that we believe to be correct, but we have not independently verified with respect to truth or correctness. There is no guarantee that our forecasts will materialize. Actual results will likely vary. Certain companies mentioned are covered by FRC under an issuer paid model. FRC or companies with related management, and Analysts, may hold shares/securities in some companies mentioned in this report, including STGX. Distribution procedure: our reports are distributed first to our web-based subscribers on the date shown on this report then made available to delayed access users through various other channels for a limited time. To subscribe for real-time access to research, visit for subscription options. This report contains “forward looking” statements. Forward-looking statements regarding the Company, industry, and/or stock’s performance inherently involve risks and uncertainties that could cause actual results to differ from such forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance of the Company’s products/services in the marketplace; acceptance in the marketplace of the Company’s new product lines/services; competitive factors; new product/service introductions by others; technological changes; dependence on suppliers; systematic market risks and other risks discussed in the Company’s periodic report filings, including interim reports, annual reports, and annual information forms filed with the various securities regulators. By making these forward-looking statements, Fundamental Research Corp. and the analyst/author of this report undertakes no obligation to update these statements for revisions or changes after the date of this report. Fundamental Research Corp DOES NOT MAKE ANY WARRANTIES, EXPRESSED OR IMPLIED, AS TO RESULTS TO BE OBTAINED FROM USING THIS INFORMATION AND MAKES NO EXPRESS OR IMPLIED WARRANTIES OR FITNESS FOR A PARTICULAR USE. ANYONE USING THIS REPORT ASSUMES FULL RESPONSIBILITY FOR WHATEVER RESULTS THEY OBTAIN FROM WHATEVER USE THE INFORMATION WAS PUT TO. ALWAYS TALK TO YOUR FINANCIAL ADVISOR BEFORE YOU INVEST. WHETHER A STOCK SHOULD BE INCLUDED IN A PORTFOLIO DEPENDS ON ONE’S RISK TOLERANCE, OBJECTIVES, SITUATION, RETURN ON OTHER ASSETS, ETC. ONLY YOUR INVESTMENT ADVISOR WHO KNOWS YOUR UNIQUE CIRCUMSTANCES CAN MAKE A PROPER RECOMMENDATION AS TO THE MERIT OF ANY PARTICULAR SECURITY FOR INCLUSION IN YOUR PORTFOLIO. This REPORT is solely for informative purposes and is not a solicitation or an offer to buy or sell any security. It is not intended as being a complete description of the company, industry, securities or developments referred to in the material. Any forecasts contained in this report were independently prepared unless otherwise stated, and HAVE NOT BEEN endorsed by the Management of the company which is the subject of this report. Additional information is available upon request. THIS REPORT IS COPYRIGHT. YOU MAY NOT REDISTRIBUTE THIS REPORT WITHOUT OUR PERMISSION. Please give proper credit, including citing Fundamental Research Corp and/or the analyst, when quoting information from this report. The information contained in this report is intended to be viewed only in jurisdictions where it may be legally viewed and is not intended for use by any person or entity in any jurisdiction where such use would be contrary to local regulations or which would require any registration requirement within such jurisdiction.

Companies Mentioned:

E3 Lithium Limited (ETL.V), World Copper Ltd. (WCU.V), Hot Chili Limited (HHLKF), Starcore International Mines Ltd. (SAM.TO), Enterprise Group, Inc. (E.TO), Millennial Potash Corp. / TSXV: MLP, Eskay Mining Corp. / TSXV: ESK, Churchill Resources Inc. / TSXV: CRI, Elixinol Wellness Limited/ ASX: EXL .