By Otto Rock
[biiwii comment: okay sure, I’m being just a little self-serving; read on… ;-)]
Here’s a note that turned into a rant, part of last weekend’s edition of The IKN Weekly, IKN498.
Evrim Resources (EVM.v): In praise and defence of Joe Mazumdar and Brent Cook of Exploration Insights
I’m going to get something off my chest and have a good old rant.
Last week, we saw another junior story hit hard times as Evrim Resources (EVM.v) released first drilling results at its (to that point very promising and exciting) Cuale project in Mexico. Even though it’s an exploreco in LatAm, it’s not one that’s been featured on these pages as once the initial market-moving event happened to the stock, its potential risk/reward didn’t look attractive to me. My neutral position started to look a bit shaky when no lesser name than Newmont (NEM) decided to take a minority stake in the company by buying into a $7.3m place at $1.50/share, but as things turned out the drilling announced at Cuale last week didn’t get close to matching the initial trench results from the project (I’m not going to go into post-mortem details of a stock we have not previously covered here, if you want to know more check out the NR or mail me and I’ll be happy to give the quick’n’dirty) and the stock did this (below).
That is one helluva nasty sell-off. It depends where you draw the line exactly, but in approximate terms it’s a 75% haircut and this weekend’s $0.325 price is a mile away from where it was.
And now to the point: It so happens that this week saw me watching the market pretty closely and on the back of the collapse, bullboards and social media of all shapes and sizes decided to lay into Exploration Insights, the mining newsletter run by Joe Mazumdar and Brent Cook, as they’ve had EVM as one of their positions. So yes, they got hit by the big sell-off and yes it’s a hole blown in their portfolios (they like me use the “eat your own dinner” system and only reco the stocks they buy). So out came the trolls and the “Ha Ha Exploration Insights Sucks!” or “Joe and Brent have cost their subscribers a lot of money” type comments, Monday morning QBs all around.
Which goes to show that a little knowledge is a dangerous thing. That and the majority of people who spout on bullboards are pig ignorant and will often prefer not only to be that way but stay that way. Yes, they held into the bad news, but what the easy critics and trolls fail to mention was that Exploration Insights bought into EVM at 10c back in late 2015. And then in April 2018 when the first flush of good news about Cuale came in, they made a partial sale of stock at $1.38. Here’s that mapped out on a price chart:
If that’s your idea of a failure, I can only assume that Brent and Joe would like to fail in your eyes all the time. On show there isn’t just good investment advice in a junior exploreco, it’s exceptional. They identify an opportunity early, have the chops to call a partial sale when things suddenly get peppy, and even after the massive selling they are a mile up on their original purchase. Not only that, but this week Joe/Brent have two other trade plans open on EVM but in order to know about them, you’ll need to subscribe to their service.
Which I strongly advise you to do. I know it’s not the cheapest out there, but Exploration Insights (EI) is the best newsletter written on the mining industry, hands down period no question and yes, I very much include The IKN Weekly in that calculation. The exact focus of EI is somewhat different to The IKN Weekly and all about using the duo’s geological knowledge to identify early/very early-stage exploration opportunities in which to invest, but that’s a minor point. They are the best and you should subscribe to their service, but even if you don’t you can do yourself a favour this week and go around your usual internet haunts and jot down the names of people who have spent the week criticizing Joe/Brent for their position in EVM; those people, quite literally, do not know what they are talking about and their advice on other matters is very likely to be of the same low quality.
I’m an irregular reader of other opinions on mining and markets, but there are only two newsletters that I read every edition, come what may. One is Gary Tanashian’s ‘Notes From The Rabbit Hole’ (12), which gets frequent mention on these pages due to his unbeatable macro-coverage services and impressively ego-free, insightful eye. The other is Exploration Insights (13). I often find myself agreeing with their viewpoints but definitely not all the time (and when it comes to difference of opinions, both they and I have had the last laugh on different subjects over the years), but my stars when they say something you’d be daft not to listen (and you’d better have a good reason to oppose them). Joe/Brent and Gary are both best of breed newsletter writers, I cannot recommend them too highly. And with “failures” like Evrim, who needs successes anyway? Christmas is coming…buy yourself a something nice.
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