Analysts’ Ideas Of The Week


equity market


  1. Factors behind the pullback in equity markets and metal prices last week
  2. We are raising our full-year average price forecasts for three metals
  3. Material news from Binance and Coinbase (NASDAQ: COIN)
  4. We believe the Bank of Canada’s (BoC) study on Central Bank Digital Currencies (CBDC) overlooked two key points
  5. In Q2, revenue of a junior gold producer under coverage was up 50% QoQ; EPS turned positive

FRC Top Picks

The following table shows last week’s top five performers among our Top Picks, including two junior resource companies, two financials, and one biotech. The top performer, Noram Lithium Corp. (TSXV: NRM/MCAP: $46M), was up 5.8%. NRM is completing a pre-feasibility for its large lithium project in Nevada. In 2022, a preliminary economic assessment had returned an AT-NPV8% of US$1.30B, and a robust AT-IRR of 31%. Our prior reports can be viewed here.

Top 5   Weekly PerformersWoW Returns
Noram Lithium Corp. (NRM.V)5.8%
Rio2 Limited (RIO.V)4.0%
Atrium Mortgage Investment Corporation (AI.TO)3.7%
Hemostemix Inc. (HEM.V)3.3%
Timbercreek Financial Corp (TF.TO)2.6%
* Past performance is not indicative of future performance (as of August 14, 2023)

Companies on our Top Picks list are up 10% on average since we initiated coverage vs -32% for the benchmark (TSXV).

AIW Top Picks
Total   Return1 Week1 mo3 mo6 mo1 yr3 yrSince launch
Special Situations (MIC)2.2%8.0%1.0%-24.3%-26.2%33.3%-22.0%
Private CompaniesN/AN/AN/AN/A6.7%20.5%30.5%
Portfolio (Total)-4.0%-5.5%-8.7%-18.4%-17.5%-4.1%9.6%
Benchmark (Total)-1.3%-4.6%-2.6%-3.3%-11.7%-18.3%-32.3%
Portfolio (Annualized)-----17.5%-1.4%1.0%
Benchmark (Annualized) -----11.7%-6.5%-4.0%

1. Since the earliest initiating date of companies in the list of Top Picks (as of August 14, 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 down 0.4% on average (down 2.2% in the prior week), amid weaker economic data out of China, and higher than expected U.S. PPI (inflation). The market is expecting the Fed to maintain its rate at the upcoming meeting in September. We believe the Fed will be forced to slash rates within the next six months, amid escalating financial instability.

AIW Top Picks

Source: FRC/Various

Metal prices retreated amid higher inventory levels, and a stronger US$.


Valuations of gold producers were down 0.5% last week (down 6% in the prior week); base metal producers were down 2% (down 4% in the prior week).

gold producer
base metals
 Gold ProducersEV / R   (forward)EV / EBITDA (forward)EV / R (forward)EV / EBITDA (forward)
4Agnico Eagle3.887.933.928.02
5AngloGold 1.995.841.945.70
6Kinross Gold 2.004.882.034.96
7Gold Fields2.825.442.785.34
9Hecla Mining4.1412.844.2216.11
13Eldorado Gold1.854.361.854.35
 Average (excl outliers)2.545.822.525.80
 Base Metal ProducersEV / R   (forward)EV / EBITDA (forward)EV / R (forward)EV / EBITDA (forward)
1BHP Group 2.955.642.915.56
2Rio Tinto2.194.912.114.73
5Anglo American1.514.351.504.33
6Teck Resources2.565.912.505.76
7First Quantum3.609.143.569.05
 Average (excl outliers)2.095.672.055.56

Given that YTD prices have exceeded our expectations, we are raising our full-year average price forecasts for gold, silver, and copper.

FRC Forecasts
Current Price2023E(Old)2023E Long-Term (2025+)
Gold (US$/oz)$1,911$1,875$1,900$1,400
Silver (US$/oz)$22.60$22.00$22.50$18.00
Copper (US$/lb)$3.74$3.50$3.70$3.00
Zinc (US$/lb)$1.09$1.25$1.25$1.10
Nickel (US$/lb)$8.97$10.00$10.00$8.00
Source: FRC

Source: FRC

Updates from Resource Companies Under Coverage

Equity Metals Corporation / TSXV: EQTY

PR Title

Extends new mineralization; 7.7 m of 0.9 g/t Au, 57 g/t Ag, 1.4% Pb and 6.5% Zn (11.2 g/t AuEq or 445 g/t AgEq) at the Sveinson deposit, Silver Queen project, B.C.

FRC Opinion

Positive – Drilling continues to intercept significant gold and base-metal values, while extending the known mineralized area. We are expecting an updated resource estimate next year.

Starcore International Mines Ltd. / TSX: SAM

PR Title

Announces Q1 production results (Mexico)

FRC Opinion

Negative – Q1 production was down 34% YoY, due to lower grades. We had anticipated production to remain flat YoY. SAM has been developing a higher-grade zone over the past few months. Management expects higher grades in the coming months, which could potentially offset the low production in Q1. On a positive note, SAM has indicated that it has identified an exploration property in the region. SAM has been actively seeking projects that can potentially supply feed for its underutilized processing plant.

CMC Metals Ltd. / TSXV: CMB

PR Title

Identifies gravity anomalies at the Silverknife prospect area, northern B.C.

FRC Opinion

Positive – Geophysical surveys identified new targets, increasing the project’s resource potential. This project is located 1.1 km northwest of Coeur’s (NYSE: CDE) high-grade Silvertip mine.

StrategX Elements Corp./ CSE: STGX

PR Title

Announces a non-brokered private placement of up to $1M

FRC Opinion

Positive – STGX is focused on advancing exploration at its flagship Nagvaak project (Nunavut), which has potential for both nickel and graphite.  

Steppe Gold Limited/ TSX: STGO

PR Title

Announces Q2 results

FRC Opinion

Positive – Revenue was up 50% QoQ, driven by higher gold sales. EPS improved from -$0.005 to $0.09. On average, revenue and EPS exceeded our estimates by 10%. We will produce an update report shortly.  

Verde Agritech/ TSX: NPK

PR Title

Announces Q2 results

FRC Opinion

Negative – Revenue was down 7% QoQ, driven by lower fertilizer prices. However, EPS improved, from -$0.001 to $0.003, due to lower operating expenses. On average, revenue and EPS were 40% lower  than our estimates. We will produce an update report shortly. We are expecting positive news flow as the company is in advanced discussions for selling carbon credits. A third-party study has indicated that a tonne of Verde’s products can potentially extract 120 kg of carbon dioxide.

Additional Updates on Coverage:

 We are terminating coverage on the following company as we have completed our coverage period.   

 Sirios Resources Inc. (TSXV:SOI)

We are suspending coverage on the following companies as management of these companies have not responded to our questions for an update report:

Hot Chili Limited (ASX:HCH)

Lexaria Bioscience Corp. (NasdaqCM:LEXX)

ESE Entertainment Inc. (TSXV:ESE)

Sokoman Minerals Corp. (TSXV:SIC)

Weekly Crypto Commentary

Prices of mainstream/popular cryptos were up 1% on average last week (flat in the previous week).

August 14, 2023
Binance Coin-2%-1%-25%

Source: FRC/Yahoo Finance

The global MCAP of cryptos is US$1.2T, down 4% MoM, but up 2% YoY.

total crypto

Source: Coinmarketcap

Companies operating in the crypto space are trading at an average EV/R of 8.0x (previously 8.9x).

EV/R of Crypto Companies

ev r of crypto

Source: S&P Capital IQ/FRC

August 14, 2023
Crypto CompaniesTickerTEV/Revenue
Banxa HoldingsTSXV: BNXA0.6
BIGG DigitalCSE: BIGG12.0
Canaan Inc. NASDAQ: CAN0.8
Coinbase GlobalNASDAQ: COIN6.8
Galaxy Digital HoldingsTSX: GLXYN/A
Hive Blockchain TechnologiesTSXV:HIVE4.8
Marathon Digital HoldingsNASDAQ: MARA18.6
Hut 8 Mining Corp. TSX: HUT10.0
Riot BlockchainNASDAQ: RIOT10.0

Source: S&P Capital IQ/FRC

Key sector developments are listed below (mixed):

 – A recent study by the Bank of Canada (BoC) highlighted that there are no material incentives for Canadians to adopt a Central Bank Digital Currency (CBDC). Per the BoC, Canadians are satisfied with existing payment methods, given 98% of Canadians have a bank account, and 87% have a credit card. Although we acknowledge this point, we believe the study failed to highlight the potential of CBDCs to lower transaction fees for consumers, and facilitate regulatory oversight of transactions to minimize fraud and criminal activities. Based on the findings of this study, we anticipate that Canada will temporarily halt its CBDC initiatives until competing private cryptos, such as Bitcoin and Ethereum, gain more traction as viable alternative payment methods.

 – Binance has submitted an application for operating a trading platform in Taiwan. Last month, Binance had announced that it obtained a license to operate in Dubai. Despite being under investigation by the U.S. SEC, Binance’s ability to expand its global presence is encouraging.

 – Coinbase is enhancing its services for Canadians by introducing the Interac e-transfer feature, enabling instant fund deposits. We believe this is a promising development, as numerous competitors, both large and small, had exited Canada due to stringent regulations.

Weekly Cannabis Commentary


Cannabis Industry Performance

August 14, 2023

Source: FRC/Yahoo Finance

Last week, U.S. cannabis stocks underperformed their Canadian peers (-7% vs -3%). U.S. stocks had underperformed in the week prior to last as well.


Canadian cannabis stocks are trading at a 9% premium on average (previously 1% discount) relative to their U.S. peers.

Aug   08, 2023Aug   08, 2023
Canadian   CompaniesTickerTEV/RevenueTEV/EBITDATEV/RevenueTEV/EBITDA
Aurora Cannabis Inc.TSX: ACB1.3NM1.3NM
Canopy Growth Corp.TSX: WEED2.6NM2.3NM
Organigram Holdings Inc.TSX: OGI0.6NM0.6NM
Tilray Inc.NASDAQ: TLRY2.7NM3.2NM
U.S.   CompaniesTickerTEV/RevenueTEV/EBITDATEV/RevenueTEV/EBITDA
Cresco Labs Inc. OTC: CRLBF1.
Curaleaf Holdings Inc. OTC: CURLF2.717.32.417.0
Green Thumb Industries Inc.OTC: GTBIF2.
Trulieve Cannabis Corp.OTC TCNNF1.
Implied Premium (Canada vs U.S.) (Average)-1%9%

Source: S&P Capital IQ, FRC

                                                                                       Average EV/R


Source: S&P Capital IQ, FRC

Psychedelic Industry Performance

Psychedelic stocks were down 4% on average last week (down 5% in the previous week).

August 14, 2023
Atai Life Sciences N.V.-37%-4%-64%
COMPASS Pathways plc-1%1%-56%
Cybin Inc.-21%-8%-57%
Delic Holdings Corp.-92%-3%-93%
GH Research19%-8%-13%
Mind Medicine Inc.51%9%-57%
Numinus Wellness Inc.-14%-8%-39%
Seelos Therapeutics Inc.98%-13%37%

Source: TMX Money, FRC

tesla survey

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:

Noram Lithium Corp. (NRM.V), Rio2 Limited (RIO.V), Atrium Mortgage Investment Corporation (AI.TO), Hemostemix Inc. (HEM.V), Timbercreek Financial Corp (TF.TO), Equity Metals Corporation / TSXV: EQTY, Starcore International Mines Ltd. / TSX: SAM, CMC Metals Ltd. / TSXV: CMB, StrategX Elements Corp./ CSE: STGX, Steppe Gold Limited/ TSX: STGO, Verde Agritech/ TSX: NPK,  Sirios Resources Inc. (TSXV:SOI), Hot Chili Limited (ASX:HCH), Lexaria Bioscience Corp. (NasdaqCM:LEXX), ESE Entertainment Inc. (TSXV:ESE), Sokoman Minerals Corp. (TSXV:SIC).