Analysts’ Ideas Of The Week



  1. Companies on our Top Picks list were up 3.3% on average in the past three months vs 2.4% for the benchmark (TSXV). 
  2. Why did zinc prices fall last week?
  3. Our thoughts on B2Gold’s (TSX: BTO) offer to acquire Sabina Gold & Silver Corp. (TSX: SBB)
  4. An Agtech company under our coverage is partnering with the largest manufacturer of tractors in the world
  5. Two crypto miners are merging to form a large-scale miner, with a combined MCAP of US$990M

FRC Top Picks

The following table shows last week’s top five performers among our Top Picks, including three junior resource companies, one crypto, and one mortgage investment corporation. The top performer Transition Metals Corp. (TSXV: XTM.V), was up 13.3%. XTM has attracted a partner for one of its projects. Our prior reports can be viewed here.

Top 5 Weekly PerformersWoW Returns
Transition Metals Corp.(XTM.V)13.3%
GoviEx Uranium Inc. (GXU.V)8.3%
Sabre Gold Mines Corp. (SGLD.TO)7.1%
Banxa Holdings Inc. (BNXA.V)7.1%
Timbercreek Financial Corp (TF.TO)2.8%
* Past performance is not indicative of future performance (as of February 13, 2023)

Companies on our Top Picks list were up 3.3% on average in the past three months vs 2.4% for the benchmark (TSXV). 

AIW Top Picks (1)
Total Return1 Week1 mo3 mo6 mo1 yr3 yrSince launch
Special Situations (MIC)-0.1%2.8%10.3%-14.8%-36.0%38.3%-17.2%
Private CompaniesN/AN/AN/AN/A4.7%25.3%16.4%
Portfolio (Total)-3.8%-2.2%3.3%-13.9%-32.2%22.6%56.9%
Benchmark (Total)0.5%0.2%2.4%-7.9%-27.7%5.8%-30.4%
Portfolio (Annualized)-----32.2%7.0%5.0%
Benchmark (Annualized) -----27.7%1.9%-3.9%
1. Since the earliest initiating date of companies in the list of Top Picks (as of February 13, 2023)

1. Since the earliest initiating date of companies in the list of Top Picks (as of February 13, 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 0.4% on average (up 0.9% in the prior week). The S&P 500 was up 0.3% ahead of U.S. inflation data, partially offset by hawkish comments from the Fed.

Current vs Pre Covid-19 (As of Feb 13, 2023)

AIW Top Picks (9)

Source: FRC/Various

Metal prices were relatively flat last week. Zinc prices were down 7% WoW, amid higher inventories.

week over week
year over year

Valuations of gold producers were down 2% last week (down 4% in the prior week); base metal producers were down 3% (down 3% in the prior week as well).

gold producers chart
base metal
 Gold   ProducersEV / R   (forward)EV / EBITDA (forward)EV / R (forward)EV / EBITDA (forward)
3Polyus 3.20n/a3.06n/a
4Agnico   Eagle4.249.324.149.11
5AngloGold 2.075.682.015.52
6Kinross   Gold
7Gold   Fields2.544.782.524.72
13Eldorado   Gold2.165.732.125.58
 Average   (excl outliers)2.776.542.716.40
 Base Metal ProducersEV / R   (forward)EV / EBITDA (forward)EV / R (forward)EV / EBITDA (forward)
1BHP Group 3.185.583.155.52
2Rio Tinto2.384.772.344.67
5Anglo American1.704.191.634.02
6Teck Resources1.993.901.923.78
7First Quantum3.006.792.876.48
 Average (excl outliers)2.034.701.984.56

We are maintaining our metal price forecasts.  

FRC Forecasts
Current Price2023E Long-Term (2025+)
Gold (US$/oz)$1,852$1,825$1,400
Silver (US$/oz)$21.83$22.00$18.00
Copper (US$/lb)$4.05$3.50$3.00
Zinc (US$/lb)$1.41$1.25$1.10
Nickel (US$/lb)$11.75$10.00$8.00
Source: FRC

Source: FRC

Key sector developments are listed below (positive):

  1. This morning, B2Gold (MCAP: $5.2B) announced its plans to acquire Sabina Gold & Silver Corp. (MCAP: $1B) for $1B. SBB is advancing its Goose project (Nunavut) to production. The offer price reflects an 18% premium to SBB’s last closing price. BTO shares were down 3% on this news, but SBB shares were up 12%, indicating that the market believes BTO is overpaying. We note that the offer price is in line with a feasibility study completed in 2021, which returned an AT-NPV5% of $1.13B, using US$1,600/oz gold.
  2. Newmont Corporation (NYSE: NEM) is acquiring Newcrest Mining (ASX: NCM) for US$17B (annnounced earlier this month), while Pan American Silver (TSX: PAAS) and Agnico Eagle Mines (NYSE: AEM) are acquiring Yamana Gold (TSX: YRI) for US$5B (announced in Q4-2022). We believe these acquisitions indicate that miners believe that the sector is oversold, implying that more M&A deals are likely this year.
  3. Volvo (OM:VOLV) is in advanced discussions with lithium miners/processing companies to secure long-term stable supply of lithium. We consider this a positive signal for explorers/developers focused on EV metals.

Updates from Resource Companies Under Coverage

Azure Minerals Limited/ ASX: AZS

PR Title

Delivers a maiden resource for the Ridgeline nickel deposit

FRC Opinion

Positive – Expanded the project’s nickel/copper/cobalt resource by 28%, by delineating a maiden resource estimate for a new target. We believe there is resource expansion potential as several prospects have been identified on the project. The project also has potential for lithium, as a recent drill program returned promising lithium values.

Transition Metals Corp./TSXV: XTM

PR Title

Options the Homathko property to Aurum Lake Mining Corp. (TSXV: ARL)

FRC Opinion

Positive –  ARL can acquire  the project for cash payments totaling $470k, $500k in exploration expenses, and a lump sum of $5M, if the project is advanced to production. XTM’s MCAP of $4.6M, and cash of $2.1M, indicates that the market is assigning a value of just $2.5M for its portfolio, consisting of 25+ projects.

Lomiko Metals Inc./TSXV: LMR

PR Title

Pre-feasibility level flotation optimization studies produced consistent high-grade concentrates, grading up to 99.7% C (graphite)

FRC Opinion

Neutral – Improved concentrate grades (from 95% to 98%); however, recovery rates declined (from 94% to 87%). It is too early for us to comment whether the positive impact of higher product prices (from higher grades) will offset the negative impact of lower recoveries (higher OPEX). Additional tests to produce value-added products are underway.

Sonoro Gold Corp. /TSXV: SGO

PR Title

Updated resource estimate at Cerro Caliche gold project

FRC Opinion

Neutral – No material changes in tonnage/grades. An updated PEA is expected in Q2-2023.

NV Gold Corporation/ TSXV: NVX

PR Title

Obtained approval for a drill program on the SW Pipe project in Nevada

FRC Opinion

Positive – NVX is planning to commence a maiden drill program this quarter. The project is located near  Barrick’s (NYSE: GOLD) and Newmont’s (NYSE: NEM) projects.

Sokoman Minerals Corp./TSXV: SIC

PR Title

Reports additional high-grade gold: Moosehead gold project, Central Newfoundland

FRC Opinion

Positive – Continues to return high gold grades over wide intervals, including 21.32 m of 9.75 g/t Au at the Eastern trend, and 5 m of 26.87 g/t from the recently identified 511 zone.  We expect SIC to conduct more drilling prior to completing a maiden resource estimate.

New Age Metals Inc./TSXV: NAM

PR Title

Announces palladium assays of a drill program conducted at River Valley (Sudbury, Ontario) last year

FRC Opinion

Positive –  Six step-out holes at two targets intersected relatively high-grade palladium mineralization, indicating resource expansion potential; additional step-out drilling planned this year.

Churchill Resources Inc./TSXV: CRI

PR Title

Drilling results

FRC Opinion

Positive –  Eight out of 11 holes returned significant grades, including 1.46 m of 1.79% nickel, 0.24% copper, and 0.04% cobalt.  A 5,000 m drill program at Taylor Brook and Florence Lake is scheduled  this year.

Colibri Resource Corporation/TSXV: CBI

PR Title

2022 drill results: Diamante gold and silver project (Sonora, Mexico)

FRC Opinion

Positive – Several holes returned attractive grades (1+ gpt gold) over long intervals, at shallow depths. We expect CBI to conduct more drilling prior to completing a maiden resource estimate.

E3 Lithium Ltd./TSXV: ETL

PR Title

Received $4.9M from exercise of warrants

FRC Opinion

Positive – Well funded, with $45M+ in the treasury. The company is aiming to commence pilot operations (lithium in Alberta) in Q3-2023.

Golden Minerals Company/NYSE: AUMN

PR Title

Continued exploration success at Yoquivo gold-silver project, Mexico

FRC Opinion

Positive – Returned several high-grade gold-silver intercepts; AUMN is completing a maiden resource estimate on this project.

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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, including MSFT. 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:

Transition Metals Corp.(XTM.V), GoviEx Uranium Inc. (GXU.V), Sabre Gold Mines Corp. (SGLD.TO), Banxa Holdings Inc. (BNXA.V), Timbercreek Financial Corp (TF.TO), Azure Minerals Limited/ ASX: AZS, Transition Metals Corp./TSXV: XTM, Lomiko Metals Inc./TSXV: LMR, Sonoro Gold Corp. /TSXV: SGO, NV Gold Corporation/ TSXV: NVX, Sokoman Minerals Corp./TSXV: SIC, New Age Metals Inc./TSXV: NAM, Churchill Resources Inc./TSXV: CRI, Colibri Resource Corporation/TSXV: CBI, E3 Lithium Ltd., Golden Minerals Company/NYSE: AUMN, Microsoft Corp., Clean Seed Capital Group Ltd./ TSXV: CSX .