This post is part of a special annual report -- Top Stock Picks '09 -- in which TheStockAdvisors.com asked 75 leading newsletter advisors to select their favorite investment for the new year.
"Virginia Mines (TSE: VGQ) is an old favorite that is ready to shine again," says Adrian Day. In The Global Analyst, he looks at the firm holding interests in mining entities.
"In the long-odds resource exploration business, Virginia has a better model: it generates prospects which it farms out to partners at an early stage.
"The partners earn in to the properties by spending the exploration dollars. This is the highest-risk part of the exploration process.
"By this model, Virginia is able to maintain its balance sheet and avoid the dilution that bedevils exploration companies. It can then build a portfolio of minority interests in multiple projects which increases its odds of eventual success.
"Virginia now has more than a dozen active projects, with numerous joint venture partners in several different resources. All its properties are in Quebec, a mining friendly jurisdiction.
"It has a superb track record, having found the Eleonore gold deposit which it sold to Goldcorp., as well as a zinc discovery which, owing to low commodity prices, is on the back burner. In the coming year, it intends to focus on exploration for new gold targets in the prolific area around Eleonore.
"And it's cheap; a single asset, a royalty (on Eleonore), with an net asset value (NAV) of $90 million, is worth more than the entire market cap of the company ($80 million).
"In addition, Virginia has a solid war chest of over $40 million. The rest of the company is free. There's little risk and a lot of upside for the patient investor."
Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.
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Reader Comments (Page 1 of 1)
1-09-2009 @ 12:41AM
Top Stocks said...
You can research more stocks in:
www.gainerstoday.com.
The best stock for 2009 are there.