From Weak Hands into Strong Hands
Dec 24, 2014
At market tops, shares move from strong hands into weak hands. At market bottoms, the opposite: from weak hands into strong hands.
Sheldon Inwentash of Pinetree Capital (PNP-T) had some early Xmas presents for investors as Pinetree Capital managed to violate covenants of their convertible debentures in November and then again in early December. On November 10, the company announced the first, on December 2, announced the second. As a result, Pinetree has been dumping shares with both hands to raise cash.
As those shares have moved from weak hands into strong hands, they offer an unusual opportunity. The first time I saw shares literally being thrown off a cliff was with the shares of Sanatana (STA-V) on the 8th of December as the price plummeted from $.065 to $.025 on volume of more than 23 million shares. That was 25% of the float. Those shares have recovered 50% already. Nothing at all changed with the company other than Pinetree needing cash.
For the last ten days, Pinetree has been dumping Gold Canyon (GCU-V). Pinetree/Sheldon owned 12 million shares. While it’s impossible to know exactly how many shares they have remaining, about 12 million shares have traded hands. No doubt there were other weak hands anxious to capture the very bottom with their sales.
If you like gold, Gold Canyon offers one of the best opportunities to leverage the price of gold. The Northern Miner did a piece on the company in early 2013 showing an NPV of $579 million with gold at $1300 and silver at $25.
The Springpole project has a 43-101 resource of about 5 million ounces of gold and 26 million ounces of silver. The company has $1.5 million in the bank and will sit until the price of gold and silver recovers. The shares were $.25 just over a month ago and touched $.09 days ago under the weight of 12 million shares being dumped. They will recover. At $.10 a share, you are paying about $2.60 an ounce for gold in a safe jurisdiction. That’s pretty hard to beat. Who knows, gold might go up someday.
Gold Canyon is not an advertiser. I do own shares. Do your own due diligence.
Gold Canyon Resources
GCU-V $.10 (Dec 23, 2014)
GDCRF OTCQX 148.6 million shares
Gold Canyon website