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.

Financials, Technology, Energy, and Special Situations

Kidoz Inc./ TSXV: KIDZ

PR Title

Announces preliminary/unaudited 2022 revenue and EPS

FRC Opinion

Negative – 2022 revenue was up 14% YoY, but 7% lower than our estimate, due to softer ad spending. Due to increased sales/marketing/R&D expenses, net losses increased YoY from $0.2M to $1.4M, vs our forecast of $0.4M in net profit. We note that KIDZ reported YoY revenue growth in Q4-2022, when most ad-based tech companies reported revenue declines.

Lexaria Bioscience Corp./NASDAQ: LEXX

PR Title

Discovers potential novel mechanism from hypertension study

FRC Opinion

Positive – Studies indicated that Lexaria’s DehydraTECH™-enabled CBD has potential to reduce catestatin (a contributor of hypertension). This is a positive development as Lexaria is planning phase 1(b) tests this year.  

Weekly Crypto Commentary

Prices of mainstream/popular cryptos were down 8% on average last week (up 7% in the previous week).

February 27, 2023
Binance Coin23%-4%-16%

Source: FRC/Yahoo Finance

The global MCAP of cryptos is US$1.08T, up 3% MoM, but down 36% YoY.

total crypto

Source: Coinmarketcap

Companies operating in the crypto space are trading at an average EV/R of 3.7x (previously 3.9x).

EV/R of Crypto Companies

ev crypto currency

Source: S&P Capital IQ/FRC

February 27, 2023
Crypto CompaniesTickerTEV/Revenue
Banxa HoldingsTSXV: BNXA0.6
BIGG DigitalCSE: BIGG7.8
Canaan Inc. NASDAQ: CAN0.2
Coinbase GlobalNASDAQ: COIN4
Galaxy Digital HoldingsTSX: GLXYN/A
Hive Blockchain TechnologiesTSXV:HIVE1.8
Marathon Digital HoldingsNASDAQ: MARA10.1
Hut 8 Mining Corp. TSX: HUT2.7
Riot BlockchainNASDAQ: RIOT2.6

Source: S&P Capital IQ/FRC

Key sector developments are listed below (mixed):

1. The Canadian Securities Administrators (CSA) has announced new regulations for crypto trading platforms. A few key items are listed below:

a) Segregation of funds held on behalf of clients

b) Prohibition of margin trading

c) Platforms are not allowed to offer stablecoins, unless they get regulatory approval

2. Coinbase (NASDAQ: COIN) reported 2022 results. In Q4-2022, revenue declined by 75% YoY. Monthly transacting users declined QoQ, from 8.5M to 8.3M, and trading volume declined by 9%.

Weekly Cannabis Commentary


Cannabis Industry Performance

February 27, 2023
U.S. CompaniesYTD1-Week1-Year
Cresco Labs Inc. -4%-4%-75%
Curaleaf Holdings Inc. -15%-2%-48%
Green Thumb Industries Inc.-5%-3%-57%
Trulieve Cannabis Corp.-19%-10%-72%
Canadian CompaniesYTD1-Week1-Year
Aurora Cannabis Inc.-9%-5%-76%
Canopy Growth Corp.-1%-4%-66%
Cronos Group Inc.-16%-3%-37%
HEXO Corp.77%13%-75%
Organigram Holdings Inc.-3%5%-44%
Tilray Inc.2%-1%-52%
Canadian Average8%1%-58%
U.S. Average-11%-5%-63%

Source: FRC/Yahoo Finance

Last week, Canadian cannabis stocks outperformed their U.S. peers (1% vs -5%). Canadian stocks had underperformed in the week prior to last.

Key sector developments are listed below (mixed):

  1. Twitter has started allowing cannabis companies to post ads for regulated THC and CBD products and accessories.
  2. North Carolina is preparing to vote on a bill to legalize medical cannabis next week.
  3. In 2022, medical cannabis sales in Utah were up 59% YoY, to US$119M (Source: MJBiz) .
  4. According to MJBiz, Canadian cannabis wholesale prices were down 40% last year. Due to excess supply, we expect prices to be under pressure this year as well.


Canadian cannabis stocks are trading at a 9% premium (unchanged) relative to their U.S. peers.

February 21, 2023February 27, 2023
Canadian CompaniesTEV/RevenueTEV/EBITDATEV/RevenueTEV/EBITDA
Aurora Cannabis Inc.TSX: ACB2.1NM1.9NM
Canopy Growth Corp.TSX: WEED5.0NM4.8NM
Cronos Group Inc.TSX: CRON0.0NM0.0NM
Organigram Holdings Inc.TSX: OGI1.596.51.487.8
Tilray Inc.NASDAQ: TLRY3.4NM3.4NM
U.S. CompaniesTickerTEV/RevenueTEV/EBITDATEV/RevenueTEV/EBITDA
Cresco Labs Inc. OTC: CRLBF1.
Curaleaf Holdings Inc. OTC: CURLF2.812.82.712.3
Green Thumb Industries Inc.OTC: GTBIF2.
Trulieve Cannabis Corp.OTC TCNNF1.
Implied   Premium (Canada vs U.S.) (Average)9%9%

Source: S&P Capital IQ, FRC

                                                                                       Average EV/R

average ev r

Source: S&P Capital IQ, FRC

Canadian Retail Cannabis Stores

Currently, there are 3,472 retail cannabis stores in Canada, an increase of one store WoW.

                                                                                     Nationwide Store Count

cannabis store count chart

Source: Provincial Websites, FRC

Geographic RegionStore CountStore CountStore CountStore CountPopulationPopulation / Store
Alberta 748 752 754 755 4,428,247 5,865
B.C. 411 411 485 484 5,120,184 10,579
Manitoba 141 141 167 167 1,379,121 8,258
N.B. 20 20 25 25 780,890 31,236
N.S. 36 36 46 46 978,274 21,267
Newfoundland 37 37 39 39 520,437 13,345
Northwest Territories 6 7 6 6 44,982 7,497
Nunavut 39,486
Ontario 1,457 1,456 1,689 1,690 14,745,040 8,725
P.E.I. 4 4 4 4 158,717 39,679
Quebec 82 84 89 89 8,552,362 96,094
Saskatchewan 123 128 161 161 1,181,987 7,342
Yukon 5 7 6 6 41,293 6,882
CANADA 3,070 3,083 3,471 3,472 37,971,020 10,936

Source: Provincial Websites, FRC

Psychedelic Industry Performance

Psychedelic Industry Performance

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

February 27, 2023
Atai Life Sciences N.V.-38%-4%-71%
COMPASS Pathways plc5%-3%-42%
Cybin Inc.35%18%-38%
Delic Holdings Corp.-20%-16%-62%
GH Research-2%0%-42%
Mind Medicine Inc.23%-3%-80%
Numinus Wellness Inc.2%-10%-58%
Seelos Therapeutics Inc.6%-2%-32%

Source: TMX Money, FRC

A key sector development is listed below (positive):

  1. Transcend Therapeutics, a company developing psychoactive compounds, closed a US$42M Series A financing last week.

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. 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.,.