Bill Cara
- Torex Gold Resources is another Toronto-based Goldminer, like Alamos Gold, that appears to have strong price potential from current price levels.
- The Torex El Limón Guajes gold mine in Mexico is like Mulatos of Alamos, but with higher grades which include Au, Ag and some Cu. In fact, El Limón Guajes has excellent heap leach and underground grades.
- The mine produced about 110,000 oz in 1Q2020 which matches the AGI guidance for Q1. We assume that like Alamos, Torex has suspended operations since Mexico is under the virus suspension mandate. After we see AGI results in a few days, the picture might become a tad clearer for both companies.
- Torex has many fewer shares o/s 85MM vs 390MM for AGI, which gives Torex more leverage to share price appreciation per unit move in the bullion price.
- Torex appears to be in Mexico only vs AGI, which operates in 3 countries.
- From the Company presentation, it looks like there is good exploration potential in the district.
- Although I hold no shares in Torex, it could be worth my time doing a deeper comparison review with AGI, and possibly taking a position in my Goldminer account. Today TORXF is up +4.9% at this point as Gold and most of the Goldminers are having a strong day, so I will study the Company in greater depth and will likely be a buyer on weakness.
- In general, however, I like this stock as a safe bet.