Group Ten Delivers More High Grade Platinum Group Metals
Every once in awhile I get something right. I did a story on Group Ten (PGE-V) in May of this year. Rhodium was about $27,000 an ounce. That seemed pretty steep to me given the far lower prices of gold, palladium and platinum. I said,
At the time of the article rhodium was worth $868 a gram. Today it is worth $414 for the same size gram. If you will buy things when they are cheap and sell them when they are expensive, you can make a lot of money. Gold, palladium and platinum are all about the same price as they were then. You can stay invested in physical metals all of the time with little risk if you will buy the cheap metals and sell the expensive. Right now silver and platinum seem cheap to me while rhodium and palladium seem expensive.
In December of 2015 I wrote a piece talking about the massive crash in the metals that took place between 2011 and the end of 2015. I happen to believe that we are in exactly the same position as we were in late December of 2015. Investors should keep in mind that the gold stocks finally hit bottom around January 17th of 2016 before rocketing higher with the XAU and HUI up almost three fold in the next seven months with a lot of juniors up 500-1,000% at the same time. Here is what I said,
I see exactly the same thing happening this year into January as happened five years ago. Stocks rocketed higher for the next seven months. This is the season to be picking the low hanging fruit.
Certainly Group Ten Metals (PGE-V) would qualify as low hanging fruit. The company has a 25 km strike package located adjacent to the $2.8 billion dollar Sibanye-Stillwater platinum/palladium mines in Montana. Sibanye-Stillwater has produced over 14 million ounces of pd+pt. They report 26.9 million pd+pt ounces in P+P reserves.
Group Ten has been busy drilling and expanding their resources and moving the company forward without a lot of respect from the market. In October of this year they released a 43-101 showing 157 million tonnes in inferred resources at an average of 0.45 total nickel equivalent. That’s $89 rock at today’s prices.
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If you work out the numbers, they have reported right at $14 billion dollars worth of rock in the ground. If someone bought them and paid 1% of the gross metal in the ground value, that would be $140 million. Meanwhile the company is selling for $64 million. That seems absurd to me.
On December 20th the company reported partial results from the first two holes of a fourteen-hole drill program to expand the resource. The results were barn burning and included 63.7 meters of 0.92% NiEq within a 367 meter continuous mineralization at 0.31% NiEq. The hole returned the longest intercept ever recorded in the Stillwater district with 728 meters of solid sulfide mineralization.
If Group Ten Metals is not cheap today, I don’t think it ever will be.
I have participated in a placement with Group Ten and they are an advertiser. Pease do your own due diligence.
Group Ten Metals