Analysts’ Ideas Of The Week


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  1. A copper junior was the best performer on our top picks list two weeks in a row.
  2. Our near-term outlook for the US$ and metal prices.
  3. Canadian regulators are tightening regulations for crypto trading platforms
  4. Twitter has started allowing cannabis companies to post ads.

FRC Top Picks

The following table shows last week’s top five performers among our Top Picks, including four junior resource companies, and one hemp company. The top performer World Copper (TSXV: WCU), was up 22%. WCU was the top performer in the week prior to last as well. WCU has advanced stage copper assets in Chile and the U.S., and announced an updated resource estimate last week. Additional notes are presented later in this report. Our prior reports can be viewed here.

Top 5 Weekly PerformersWoW Returns
World Copper Ltd. (WCU.V)21.9%
Lumina Gold Corp. (LUM.V)20.9%
TAAT Global Alternatives Inc. (TAAT.CN)11.4%
Monarch Mining Corporation (GBAR.TO)9.1%
Steppe Gold (STGO.TO)9.0%
* Past performance is not indicative of future performance (as of February 27, 2023)

Companies on our Top Picks list were up 54% on average since we initiated coverage vs -30% for the benchmark (TSXV).

aiw top picks chart
Total   Return1 Week1 mo3 mo6 mo1 yr3 yrSince launch
Special Situations (MIC)-0.3%3.1%9.0%-18.2%-37.5%49.9%-17.9%
Private CompaniesN/AN/AN/AN/A4.7%25.3%16.4%
Portfolio (Total)-3.0%-7.6%2.0%-16.1%-33.7%41.8%53.9%
Benchmark (Total)-0.1%0.5%8.7%-3.3%-26.5%8.6%-29.5%
Portfolio (Annualized)-----33.7%12.3%4.8%
Benchmark (Annualized) -----26.5%2.8%-3.7%

1. Since the earliest initiating date of companies in the list of Top Picks (as of February 27, 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 0.7% on average (down 0.4% in the prior week). The S&P 500 was down 0.5% amid higher personal spending and stronger consumer confidence data, signalling that the Fed is likely to continue to raise rates. The Bank of Canada is likely to pause rate hikes, as January inflation was lower than the consensus estimate. We expect the US$ to stay strong, and put downward pressure on metal prices in the coming weeks.

Current vs Pre Covid-19 (As of Feb 27, 2023)

overview of market

Source: FRC/Various

Metal prices were down last week, amid a stronger US$.

week over week graph of market
year over year of market
lme chart
shfe chart

Valuations of gold producers were down 8% last week (down 7% in the prior week); base metal producers were down 2% (up 7% in the prior week).

gold producers graph
base metal producers
 Gold ProducersEV / R   (forward)EV / EBITDA (forward)EV / R (forward)EV / EBITDA (forward)
3Polyus 3.02n/a3.02n/a
4Agnico Eagle3.507.143.447.42
5AngloGold 1.875.121.674.18
6Kinross Gold 1.924.911.794.72
7Gold Fields2.454.602.074.33
13Eldorado Gold2.055.421.794.31
 Average (excl outliers)2.565.872.395.30
 Base Metal ProducersEV / R   (forward)EV / EBITDA (forward)EV / R (forward)EV / EBITDA (forward)
1BHP Group 3.195.832.955.40
2Rio Tinto2.414.872.355.05
5Anglo American1.593.941.483.99
6Teck Resources1.945.122.224.75
7First Quantum2.877.042.857.00
 Average (excl outliers)

We are maintaining our metal price forecasts.  

FRC Forecasts
Current Price2023E Long-Term (2025+)
Gold (US$/oz)$1,818$1,825$1,400
Silver (US$/oz)$20.70$22.00$18.00
Copper (US$/lb)$4.00$3.50$3.00
Zinc (US$/lb)$1.37$1.25$1.10
Nickel (US$/lb)$11.23$10.00$8.00
Source: FRC

Source: FRC

A key sector development is listed below (positive):

  1. Lithium Royalty Corp., which holds royalty agreements in 27 projects across seven countries, is pursuing a $150M IPO. Electric Royalties Ltd. (TSXV:ELEC) is an EV-metals related royalty company under our coverage. Shares of ELEC are up 24% since we initiated coverage in September 2022.

Updates from Resource Companies Under Coverage

Los Andes Copper Ltd./TSXV: LA

PR Title

Announces a positive PFS for Vizcachitas (Chile)

FRC Opinion

Positive – A PFS returned an AT-NPV8% of US$2.8B, and an attractive AT-IRR of 24%, using US$3.7/lb copper. Shares are trading at <10% of AT-NPV8%.

Geomega Resources Inc./ TSXV: GMA

 PR Title

Options out the Pomme REE carbonatite project to Mt Monger Resources (ASX: MTM/MCAP: A$7M)

FRC Opinion

Positive – GMA has attracted an option partner for one of its non-core assets. MTM can acquire a 100% interest for A$520k in cash and shares, and A$2M in exploration expenses over three years. GMA will retain a 2% NSR.

World Copper Ltd./TSXV: WCU

PR Title

Expands resource estimate for the Zonia copper oxide deposit, Arizona

FRC Opinion

Positive –  Resources increased by 54%; grades decreased by 16%. We believe the positive impact of higher tonnage more than offsets the negative impact of lower grades. Management believes resource expansion potential exists as a 2.5 km x 1.5 km anomaly has been delineated northeast of the current resource.

Eskay Mining Corp./TSXV: ESK

PR Title

Encounters 1.51 gpt Au and 35.39 gpt Ag over 43.1 m, and 2.84 gpt Au and 22.17 gpt Ag over 26.4 m in extensional drilling at the TV deposit of the Eskay project, Golden Triangle, B.C.

FRC Opinion

Positive –  Promising results; expansion drilling at TV has extended mineralization along strike and depth.

Starcore International Mines Ltd./TSX: SAM

PR Title

Announces third quarter production results

FRC Opinion

Negative – Q3 production was down 11% YoY, to 2.5 Koz AuEq (5% lower than our forecast), due to lower grades. Production has been declining in the past few years as the company has been transitioning from higher to lower grade ore.

Lomiko Metals Inc./TSXV: LMR

PR Title

Identifies 55 new targets in the Grenville graphite mineral belt  (Quebec)

FRC Opinion

Positive – Geophysical surveys, over six graphite properties, have identified 55 targets prospective for graphite mineralization. Management is planning to test these targets through prospecting and sampling.

Silver Dollar Resources Inc./CSE: SLV

PR Title

Five new mineralized targets identified at the La Joya project in Durango, Mexico

FRC Opinion

Positive – Promising results; mapping and sampling have identified five mineralized areas. La Joya has a large historical inferred resource; this resource is shallow, and open-pittable, implying potential for low OPEX. With $6.5M in cash, SLV is well funded for exploration this year.  

Hannan Metals Limited/TSXV: HAN

PR Title

Outlines a significant exploration target to 500 m depth at the Valiente porphyry project, Peru

FRC Opinion

Positive – A geophysical survey has expanded the target area of a prospect on Belen. Belen is one of the seven targets identified to date on Valiente. Teck Resources (TSX: TECK) owns 9% of HAN’s outstanding shares.

Hot Chili Limited/TSXV: HCH

PR Title

Confirms fourth porphyry at Cortadera (Chile)

FRC Opinion

Positive – Continues to expand the mineralized footprint of the Cortadera project. Drilling intersected near surface copper mineralization over long intervals (120 m at 0.5% CuEq), implying resource expansion potential.

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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. 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.

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Companies Mentioned:

World Copper Ltd. (WCU.V), Lumina Gold Corp. (LUM.V), TAAT Global Alternatives Inc. (TAAT.CN), Monarch Mining Corporation (GBAR.TO), Steppe Gold (STGO.TO), Electric Royalties Ltd. (TSXV:ELEC), Los Andes Copper Ltd./TSXV: LA, Geomega Resources Inc./ TSXV: GMA, World Copper Ltd./TSXV: WCU, Eskay Mining Corp./TSXV: ESK, Starcore International Mines Ltd./TSX: SAM, Lomiko Metals Inc./TSXV: LMR, Silver Dollar Resources Inc./CSE: SLV, Hannan Metals Limited/TSXV: HAN, Hot Chili Limited/TSXV: HCH, Kidoz Inc./ TSXV: KIDZ, Lexaria Bioscience Corp.,.