Top 3 silver junior mining stocks ranked by silver in the ground

Take a look at our three favorite junior silver mining stocks based on the amount of silver they claim to control.

In our latest book, The Top 500 Gold and Silver Mining Stocks, we dug behind the scenes at the top 500 gold and silver mining companies based on market cap.

The goal was to uncover some of the best junior mining companies – the ones without PR agencies; the ones that fly under the radar but happen to be sitting on incredibly promising gold and silver deposits. Here are our three favorite junior silver mining stocks based on the amount of silver they claim to control:

Bear Creek Mining Corp. (PINK:BCEKF): 500,000,000 ounces silver

Bear Creek Mining’s Corani and Santa Ana Projects contain more than 500 million ounces of silver. According to the company, more than 320 million of those ounces are in reserves providing near-term production potential. A feasibility study at Santa Ana shows a 5-million-ounce per year silver mine with an 11-year mine life.

Levon Resources Ltd. (PINK:LVNVF): 450,000,000 ounces silver

Levon Resources Ltd. is exploring its Cordero Project in northwest Mexico. The project is promising with indicated resources of 310 million ounces of silver, 900,000 ounces of gold and inferred resources of 140 million ounces of silver and 229,000 ounces of gold.

Tahoe Resources Inc. (PINK:THOEF): 316,900,000 ounces silver

Tahoe Resources is a silver exploration company focused on its Escobal silver project in Southeast Guatemala. Escobal hosts an indicated silver resource of 245.2 million ounces at 500 g/t average grade, and an inferred silver resource of 71.7 million ounces at 271 g/t average grade.

Check out our book The Top 500 Gold and Silver Mining Stocks to see a list of 200 companies ranked by the amount of gold and silver they control.

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3 reasons to invest in Argonaut Gold Inc. (PINK:ARNGF)

Argonaut Gold (ARNGF) is one of our favorite junior gold and silver stocks. Here are three reasons why.

Argonaut Gold (ARNGF) is one of our favorite junior gold and silver stocks. We profiled the company in our brand new book The Top 500 Gold and Silver Mining Stocks, and we included it in our list of our Top 100 stock picks. Here are three reasons why:

1) Already in production. Unlike a lot of small-cap gold mining stocks, Argonaut Gold’s already in production. When the company reported its Q4 earnings two weeks ago, we learned that Argonaut netted $26 million ($0.30 per share) on revenue of $105 million in 2011. All told, the company sold 66,521 ounces of gold last year.

2) A growing gold resource. Argonaut Gold acquired Pediment Gold in January 2011. Along with new exploration results, that helped the company grow its gold resource from 2 million to 6.5 million ounces last year.

3) More production in 2012. After producing 66,521 ounces last year, Argonaut expects to produce anywhere from 88,000 to 97,000 ounces of gold in 2012 at cash costs between $625 and $650 an ounce. The bulk of that gold (75-80,000 ounces) should come from the company’s flagship El Castillo project. The La Colorada project (which was acquired from Pediment Gold) should yield 13-17,000 ounces of gold.

“The lowest cost ounces we will ever find are the ones that lie within the properties we already own,” Argonaut’s President Pete Dougherty said in a press release. “We remain committed to exploration as we look to grow the Company.”

Argonaut expects to spend as much $34 million in exploration and development this year. The bulk of that money will be spent at La Colorada, where the company should soon enter production.

TradingStocks.me has identified 99 more promising gold and silver mining stocks (and profiled another 400 companies) in our brand new book The Top 500 Gold and Silver Mining Stocks.

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Up 180%? 10 best gold and silver stocks returns year-to-date

From Wilcat Silver Corp. to Midway Gold Corp., here’s a look at the Top 10 best gold and silver stocks with the biggest returns this year.

Picking winning gold and silver stocks is notoriously difficult. Not only are mining stocks influenced by volatile precious metals prices, they’re also subject to natural disasters, political risk, worker strikes, misinformation and poor assay results. If you can find the right companies with the right management (see my post How to pick gold stocks that outperform the market), the gains can be extraordinary.

Here’s a list I put together of the top 10 biggest gainers in the gold and silver market year to date. I pulled only from the 100 largest gold and silver stocks by market cap:

Stock YTD Gain
NEWSTRIKE CAPITAL INC. (PINK:NWSKF) 181.24%
Midway Gold Corp. (AMEX:MDW) 177.48%
NGEX RESOURCES INC. (PINK:NGQRF) 144.63%
Richmont Mines Inc. (AMEX:RIC) 129.55%
WILDCAT SILVER CORP (PINK:WLDVF) 114.23%
SCORPIO MINING CORP (PINK:SMNPF) 97.62%
PRETIUM RESOURCES INC ORD (PINK:PXZRF) 63.02%
Samex Mining Corp. (OTC:SMXMF) 51.39%
Vista Gold Corp. (AMEX:VGZ) 48.54%
Minefinders Corp. Ltd. (AMEX:MFN) 44.75%

The year-to-date gains listed above are particularly impressive considering the steep losses gold and silver stocks suffered yesterday. Several of the stocks on the list lost nearly 20 percent in a brutal day of trading. Here are my guesses as to why these stocks have out-performed their peers this year:

NEWSTRIKE CAPITAL INC. (PINK:NWSKF): Newstrike’s Ana Paula project in Mexico continues to show impressive drill results. Most recently, the company announced 119.60-meter interval grading 3.76 g/t gold. That’s after results of 230.95-meter interval grading 7.5 g/t gold in April. The Ana Paula project has good pedigree. It was purchased from Goldcorp Inc. (NYSE:GG) last year. Goldcorp still has a robust mine there in Los Filos, and Torex Gold Resources Inc.’s (TSX:TXG) Morelos project is nearby. All three are part of the Guerrero Gold Belt.

Midway Gold Corp. (AMEX:MDW): Company insiders have been big buyers over the past six months snagging 100,000 net shares (per DailyFinance). Analysts have a price target of $3.71 on the stock as drill results from Nevada roll in. Midway’s gained a lot of investor interest thanks to a joint venture with Barrick Gold Corporation (NYSE:ABX).

NGEX RESOURCES INC. (PINK:NGQRF): The company’s Josemaria copper-gold deposit in Argentina has 460 million tonnes of gold (0.30 g/t gold) in the ground. NGEx’s also drilling for potash in Eritrea with results expected next month.

Richmont Mines Inc. (AMEX:RIC): Richmont’s Wasamac gold deposit just seems to keep mushrooming. Most recently, the company intercepted 7.28 g/t gold over 31.40m. The company has interests in 14 projects in Ontario and Quebec.

WILDCAT SILVER CORP (PINK:WLDVF): One of a handful of precious metals stocks that’s focused exclusively on silver, Wildcat Silver Corp. has an 80 percent interest in the Hermosa silver project in Santa Cruz, Arizona. The project has an indicated resource of 36 million ounces of silver and an inferred resource of 85 million ounces. Recent drilling results showed an impressive 230.9 g/t silver.

SCORPIO MINING CORP (PINK:SMNPF): Headquartered in Canada, Scorpio’s mines in Mexico are already in production. Fifty-five percent of the company’s revenue comes from silver – with the rest a mix of zinc, copper and lead. In addition to their operational Nuestra Señora mine, Scorpio has its eyes on more than 40 other exploration targets.

PRETIUM RESOURCES INC ORD (PINK:PXZRF): Much of the excitement around Pretium surrounds the company’s Snowfield deposit. Pretium could join up with mining major Seabridge Gold, Inc. (AMEX:SA) to further explore the project. On top of Snowfield, there’s the “Bonanza-grade” results the company recently announced at its Brucejack Project (5,740 g/t gold and 2,750 g/t silver).

Samex Mining Corp. (OTC:SMXMF): Samex is an early-stage exploration company that’s drilling in the Los Zorros District in Chile. Four out of 46 holes drilled at the Milagro project yielded 4.26 to 5.56 g/t gold.

Vista Gold Corp. (AMEX:VGZ): Impressive results from the company’s Mt.Todd Gold project pushed shares up nearly 20 percent in a day last week. Measured mineral resources were bumped up 23 percent to 353,000 ounces of gold. Indicated resources climbed 14 percent to 506,000 ounces of gold.

Minefinders Corp. Ltd. (AMEX:MFN): Minefinders’ massive Dolores gold and silver mine in northern Mexico is in production and has proven reserves of 1.2+ million ounces of gold and 68+ million ounces of silver. The company’s also evaluating the viability of a mine at its La Bolsa property.

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3 reasons a powerful rally in silver mining stocks is overdue

No matter what silver prices do in the near-term, silver mining companies are making money hand over fist. One of these days, the stock market is going to catch on to that fact.

In a single week of trading between May 2 and May 6, 2011, silver spot prices collapsed more than 25 percent on weak economic data, new NYMEX margin requirements and a general sense that the silver market was overheating. On top of that, public SEC filings showed that several noted hedge fund managers and silver bulls had started trimming back their silver holdings as early as February.

Even after last week’s brutal sell-off in the silver market, though, analysts remain bullish on silver mining stocks. Here are three reasons why a powerful rally in silver mining stocks is overdue:

1) The cost of production is static. Even though silver lost more than 25 percent of its value in a single week of trading, the white metal’s still up nearly 20 percent since the start of the year. “The silver companies are making very good money at $35 an ounce,” Sprott Asset Management’s Charles Oliver told Reuters last week. “They’d be making very good money at $30 and most of them would be making very good money at $25.”

Indeed, the article points out that most of the world’s largest silver mining companies report production costs between $4 and $8 an ounce. If they can turn around and sell that silver for $35 an ounce, their profit margins are enormous – even after a drop in the price of silver.

2) Consolidation on the way. The one thing that’s been missing from the 10-year bull market in precious metals has been a wave of buyouts, takeovers and consolidation in the mining space. The world’s largest mining companies are sitting on war chests full of cash, and they’ll likely target junior mining companies to ensure a steady supply of silver in the years to come.

Silver Wheaton Corp.’s (NYSE:SLW) CEO Randy Smallwood went on the record last month predicting a wave of buyouts after silver prices stabilize. Smallwood argues that small cap silver mining stocks don’t want to sell when prices are rising rapidly. The fear, of course, is that they could have gotten more money for their company and operations if they’d held out for a few more months. This steep correction in silver prices could be just the opportunity Silver Wheaton and other silver mining giants have been waiting for.

3) The fundamental trend is up. Extreme market volatility can make anyone question their reasons for investing in silver, but the long-term trend remains intact. The Federal Reserve’s continuing its inflationary monetary easing program and interest rates remain near zero. The net effect is a dollar that’s headed down.

ShadowStats.com calculates the inflation rate at 10 percent using formulas our own government used just two decades ago (before they began stripping out costs for things like food and energy from the CPI). In such an environment, holding your cash in a low-interest bank account is akin to losing 10 percent of its purchasing power every year. By contrast, silver prices are still up nearly 20 percent this year, and they’ll likely head higher by 2012. No matter what the silver price does in the near-term, though, silver miners are still making money, and they’re doing it hand over fist. One of these days, the stock market is going to catch on to that fact.

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Pretium Resources (TSE:PVG) lands major execs from Silver Standard (SSRI)

Talk about a big transfer of institutional knowledge. Last week, Silver Standard Resources, Inc. (NASDAQ:SSRI) announced it was losing two senior execs to Pretium Resources, Inc. (TSE:PVG).

Talk about a big transfer of institutional knowledge. Last week, Silver Standard Resources, Inc. (NASDAQ:SSRI) announced it was losing two senior execs in Kenneth McNaughton, Senior Vice President Exploration and Joseph Ovsenek, Senior Vice President Corporate Development. McNaughton and Ovsenek will “pursue other interests in mineral exploration with Pretium Resources, Inc.” (TSE:PVG) as of February 15, 2011.

Pretium also appointed Kenneth J. Konkin Project Manager of its flagship Snowfield and Brucejack Projects. “Mr. Konkin managed Silver Standard’s exploration programs at the Snowfield and Brucejack Projects since exploration started in 2006, and was instrumental in their success,” Pretium said in a statement. “He started working with Silver Standard in 1993, and has 30 years of exploration experience in the region.”

All told, Pretium’s projects contain combined measured and indicated resources totaling 25.8 million ounces of gold, 2,561 million pounds of copper and 127.1 million ounces of silver; inferred resources of 15.9 million ounces of gold, 1,307 million pounds of copper and 113.1 million ounces of silver, as well as molybdenum and rhenium mineralization.

I was surprised there wasn’t more of a pop in Pretium Resources’ shares, but I suspect it’s due to the fact that Pretium’s still in its start-up stages. The fact that the company’s been able to recruit so much talent, though, bodes well in an industry that relies on great management and hands-on field experience.

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