This post is part of series where we’re checking in on the Top 500 junior gold and silver mining stocks profiled in our book Top 500 Gold and Silver Mining Stocks: Metalproofing Your Portfolio from the Coming Inflation Shock.
Performance: First, let’s compare African Gold Group’s performance against the AMEX Gold Bugs Index (HUI) – a basket of industry-leading gold stocks.
|Time Span||AGONF Performance||HUI Performance|
African Gold Group’s following the usual trend: as a junior gold mining stock, it’s more volatile than shares in larger mining companies. When times are good, they’re really good for small cap miners. When times are bad, the declines are steeper.
Profile: African Gold Group, Inc., holds rights to five projects: three in Ghana and two in Mali. The Company’s most advanced asset is its Kobada gold project in Mali. The Kobada Trend contains an inferred mineral resource of 740,000 ounces of gold at a 0.3 g/t gold cutoff (recently upgraded to 1.1 million ounces), and the company believes that Kobada could be a multi-million ounce deposit. African Gold’s Ghana property also includes land abutting Keegan Resources’ holdings. http://www.africangoldgroup.ca/
Risks: With an average trading volume of 20,500 shares per day, volume on AGONF is low, but not too low. Just keep in mind that taking a large position in a small-cap stock means you may have to wait a long time to find buyers for all your shares. Volume is slightly higher on the CVE, where an average of 44K shares trade hands daily.
Recent News: The biggest news out of African Gold is the company’s upcoming resource estimate at its Kobada project. Those numbers are expected sometime this month.
“(Our resource estimate) will be upgraded to indicated from inferred and a percentage of that will go into measured,” company founder Nikiforuk told the Northern Miner in April. “We also anticipate a meaningful increase in grade.”
Step-out holes drilled at the site this spring included highlights of 70 metres of 1.83 g/t gold and 84 metres of 1.26 grams gold. If the company’s resource estimate is significantly higher, expect a boost in share price.
Last year’s preliminary economic assessment indicated that “the project could produce gold at US$470.90 per oz. processing 20,000 tonnes per day, for a total of 7 million tonnes a year” (per Northern Miner). The project currently boasts an inferred resource of 1.1 million ounces of gold.
Check out our book Top 500 Gold and Silver Mining Stocks: Metalproofing Your Portfolio from the Coming Inflation Shock (pictured above) to uncover more undiscovered gold and silver mining stocks.