Weekend Show – Joe Mazumdar & Dan Steffens – Investing Opportunities In Metals and Energy Stocks
Welcome to The KE Report Weekend Show! On this Weekend Show we feature two well respected newsletter writers focused on investing in metals stocks (Joe Mazumdar) and energy stocks (Dan Steffens).
While commodities prices pulled back this week there are a number of developments within the equities that we discuss. For comments on the pullback in commodities prices be sure to check out the Daily Editorials we posted throughout the week.
- Segment 1 and 2 – Joe Mazumdar, editor of Exploration Insights, discussing the resource market, metal prices, and M&A activities. Joe shares insights on high metals prices, merger activities, and investment opportunities in metals like silver, gold, and copper. The discussion also touches on financing news, the significance of advanced exploration and development assets, and how royalty companies fit within a portfolio.
- Click here to learn more about Exploration Insights.
- Segment 3 and 4 – Dan Steffens, President of the Energy Perspectives Group. The discussion covers the significant rise in natural gas prices, oil stability just under $80 per barrel, and a major merger between SilverBow Resources and Crescent Energy. Key drivers behind the natural gas price spike are analyzed, including increased demand from power plants and AI data centers, and its impact on the market and stock valuations. The details and synergies of the Silver Bow and Crescent Energy merger are explored, along with the potential for more M&A activity in the energy sector.
- Click here to learn more about the Energy Prospectus Group.
Great comments Wolfster, and yes, the moves lately have been more kind to investors focused in Copper, Silver, Gold, and Uranium stocks. Most of the action has been in the larger producers for the last 6-12 months, but even the smaller junior developers and explorers have been springing to life over the last few months and weeks.
That is par for the course, and why it was continually stunning to me that so few investors I spoke with were positioned in the producers the last few years in any of those sectors. It was especially confusing that so many retail investors were 100% in only the explorers, especially in more niche sectors like copper stocks and uranium stocks, but even the PM stocks. That is taking on so much risk in companies that haven’t even proved that they have economic mineral deposits yet, so the higher prices are not nearly as germane as they are for the producers or royalty companies. The moves happen first in the producers in any sector turn, and that is precisely what we’ve seen play out once again.
Why in the world did resource investors not want to be positioned for where the capital flows would head to first and leverage the companies that have operating margins that will directly benefit from higher metals prices? It was the easiest way to win in a turn in any commodity.
Sure, eventually the drill plays will have the most leverage, but not when the worm starts to turn, and that unfolds over time as the sector starts to heat up more. Now things are starting to finally heat up more, and the juniors are finally starting to move, but clearly not all juniors, and they still have to be quality with access to capital and legit work programs on compelling projects.
Yes, Nickel was smashed down hard the last 2 years, after that epic launch higher in 2022, so those stocks were hit accordingly, but even many of them have come off their bottoms and started clawing their way back higher again recently. Even Lithium stocks may have finally bottomed and started ratcheting higher again. There are lots of opportunities in the metals stocks for sure.
With regards to the Uranium stocks, I just sent out an update to my Substack subscribers yesterday, that has a few charts of the ETFs, a few ideas for moving down the risk-curve of U-stocks from the producers and near-term producers and developers, into some of the earlier stage exploration stocks (as that time has finally come), and then a few different interviews we conducted here on the KER of thought leaders reflecting on why they are bullish on the uranium sector.
_____________________________________________________
Uranium Sector Update – My Cup Runneth Over
Excelsior Prosperity w/ Shad Marquitz – (05/24/2024)
https://excelsiorprosperity.substack.com/p/uranium-sector-update-my-cup-runneth
Hot off the press here is also my first part, of a multi-part series, on growth-oriented silver producers.
_________________________________________________________
Opportunities In Growth-Oriented Silver Producers – Part 1
Excelsior Prosperity w/ Shad Marquitz – 05/25/2024
https://excelsiorprosperity.substack.com/p/opportunities-in-growth-oriented
Slow down Ex. I want to stay caught up this summer
Haha! Ok, I’ll pace myself a little more…. 🙂
Back in the 70s I was associated with the Larouche organization due to their promotion of Fusion energy. They published a magazine which focused upon both magnetic and inertial confinement. This is a related interview with top Fusion scientist Anna Erickson: https://www.youtube.com/watch?v=ABVJ3epRD3M.
At 47:59 the relation of Data (the host’s specialty) and SMR development is discussed.
All of the big battery plants being announced for Ontario (3) and one in BC won’t survive after the next Federal Election. The public can’t afford EV’s even though they are government subsidized and they don’t work in our winter climate. Technology is moving too fast for EV’s to be a viable alternative.
Mercedes just announced yesterday that they are shutting down their electric car production due to poor sales and most major car manufacturers are scaling back electric car production for the same reason. (they do not work except as golf carts) I would not want to be holding Tesla stock for very long in this environment. DT
Ditto 😂 DT
No offence DT but that’s a bit of an over the top statement to make. I don’t deny the many flaws that exist in the EV so called revolution that’s being forced on a mostly unreceptive society. However to say a change from the liberals to a conservative govt in the next election will kill the industry is a bit much. 3 of those plants are in Ontario and the conservative provincial govt is behind it just as much the federal govt.
Also the conservative provincial govt is extremely pro mining…..as much as I personally don’t agree with the whole EV being shoved down our throats I’m not going to let it bias my investing. Way too much money to be mad. Magna will be over $2 easily within a yr. Why fight it.
Wolfster, you aren’t in touch with what is happening in the political spectrum in Canada. The Ford Government, which is PC is going along with these plants that have been announced by The Liberals but are a long way off from being built. Doug Ford is a politician who tells his constituents that he is on the side of these plants, but he knows it is just a political ploy by The Liberals to garner votes. I think you should ask some of the people you work with who they want to form the next government. Then have a look at what is being proposed. If you are basing your investment thesis on the current Liberal government lots of luck with that. The winds are changing the pendulum has left the woke crowd.
The Conservatives have a commanding lead in the polls, and they don’t want a big government, they don’t want the government to decide for you what the citizens can think and do and buy. My riding is very staunch liberal and has been for many years and our Liberal candidate retired 3 months ago and we have a Federal bye-election on June 28th. Watch what happens, this country is fed up with being told how to live, I believe my riding will vote against the Liberal government, change is in the air.
For anyone who doesn’t understand Canadian politics Doug Ford is The Premier of Ontario a province of Canada, but the decisions made in Ottawa by our Federal Government are currently Liberal and The Federal government decides most policy over the provinces including building battery plants. DT
I’m not in touch. Lol…. I’m fully aware……I’m also fully aware that no one admits to having voted JT in the last election yet sock boy still ended up the leader. I’m cautiously optimistic the next election will go how I want it.
You think I’m getting it wrong. Well, I live in Alliston and know people who work at the plant. By August of this yr they will no longer be producing internal combustion engines at the plant. EV’s happening……and when it comes to magna it’s not just about nickel for EV batteries anyways.
It’s the same as that call you’ve been making about a real estate crash in Canada for a few yrs now. Yes eventually it will happen but it’s not happening overnight and the cracks will start to show long before it happens but not enough cracks exist yet. I live it every day and have been watching for the signs but there’s still tons of money going into Toronto RE. The amount of parents helping their kids buy is keeping things going. Supply/demand is staying the way it is cuz there’s no new supply of homes in the city and people still want to live there.
Wolfster, You didn’t mention the plant in Alliston it must be Honda, if it is they are receiving billions of government money from The Liberals whose agenda is EV’s at all and any cost. Not only do they subsidize the vehicles to make them cheaper for the public to buy but they are also subsidizing Honda, Volkswagen, and Stellantis the manufacturers that produce EV’s with billions and I mean billions from the public purse. That will stop with a Conservative government. Then we’ll see how long they want to make electric cars. DT
DT. Please explain why you are so sure a federal conservative win would mean a cancelation of all EV related deals. Pretty sure it was Harper in power when the auto industry bailout happened…..
Wolfster, first off Pierre Poilievre is not Stephen Harper and GM was bailed out a long time ago in The US and Canada. I don’t believe that was during Stephen Harper’s tenure as our Canadian Prime Minister. I can look it up, but I don’t feel it is relevant.
Pierre Poilievre has a different agenda. You need to listen to what he says about how he wants to tackle economic issues. He doesn’t believe in Big Government something we have had for the last 9 years under This Liberal Government. His policy will be to cut back on the rules and regulations not just the in the auto industry but all industry like oil and gas and housing and mining to get rid of the gatekeepers. He repeatedly says he doesn’t want to support industry with handouts. He will work to remove the barriers, but they must run their own business profitably or face the consequences.
He wants to defund The CBC, not just them but all the mainstream media that receive government welfare. I don’t know whether you are aware of the fact that the Canadian Broadcasting Corporation The CBC gets 1.3 billion taxpayer dollars every year from The Liberal Government although their viewership has gone way down, and their top executives are voted huge bonuses by their executive board.
There are a lot of really good interviews on You Tube where you can type in his name and listen to his policies. I suggest you start with the first one hour interview he did with Jordan Peterson around one year ago. If you want to be informed just like investing you have to do some Due Diligence. DT
First off,Harper was PM from 2006-2015 and bailouts were in 2009. I do realize everyone’s different so maybe PP will do things completely different from the usual pro business friendly conservative ways. Also I’m a huge fan of everything he says he’d do but at my age I’ve learned that every politician says what they think I want to hear but usually do half of those things at best. On the cbc front, I’m particularly perturbed by the waste of public money. While I’m happy for my mate getting pre death inheritance from his dad of multi millions,knowing his dad made his money working all his life for a crown corporation(cbc) makes my blood boil. I’m far more cynical than you. I anticipate a PP win and hope so dearly it’s a majority but I don’t expect him to do everything he’s says he will and subsidy’s to an important industry like the auto sector will be low on the priority list. He will probably just let existing deals end as is rather than upset the apple cart. Hard to be pro business and attract them if you renege on deals even if it was from a past govt……I still remember the fallout and cost from the Mississauga gas plants being cancelled……and Ford is quite happy to promote all the jobs being created so don’t be fooled. He’s quite happy with the deals.
Wolfster, bad times create strong leaders however none of them fool me, but I believe PP (Pierre Poilievre) as you like to call him is the right man at the right time. DT
Furthermore, we don’t know what is in those contracts that This Liberal Government has signed with the auto manufacturers. The Conservatives have asked to see them, but they won’t probably be released until the next election. It takes a long time to get a response from the gatekeepers. DT
https://tinyurl.com/2e45nys8
NatGas Week: Retracement
Golden C Coming Soon!
Thanks for that NatGas chart BDC, where you have the Fib retracement levels to where pricing could find support after rolling over from the recent epic rally top. Natty Gas sure has been a wild ride lately!
Yes it has, Ex. I just added a null Henry Hub (NG1) chart for the record. Its pricing structure is inferior for analysis, so I use CFD (Contract For Differences) charts.
Thanks BDC!
DOES ANYONE KNOW WHY LIO HAS BEEN SO SUPPRESSED?
I WAS CONSIDERING BUYING SOME BUT DON’T KNOW WHETHER ITS A FALLING KNIFE OR A SMALL HEAD AND SHOULDERS BOTTOME
Hi Steve – The recent LIO financing really surprised the markets in a negative way, when many assumed they already had plenty of money in the treasury, and were now mining, that should eventually lead to more revenues coming in. They’ve also not really put out as much data on how the mining and eventual processing of that ore is going, like many wanted to see.
As a result, the concerns are that the company has been floundering around operationally in the background, hence the need to raise more money for sustaining capital, and not saying as much about it. Thus investors get skittish (after having been burned repeatedly by other companies not doing well as new producers) and selling pressure has been heavy on this stock.
I own Lion One personally, but it has been one of my worst performing gold stocks over the last year or so (only surpassed by i-80 Gold that has had similar issues surprising the market with an oversized dilutive financing, and not getting the production ramped up as fast as many were anticipating).
In both cases, I’m sitting tight, as I believe both companies will eventually get escape velocity from the downward funk they have both been in, as higher metals prices do assist the production they will have moving forward, and both still have a ton of prospectivity for exploration and new discoveries and/or expansion of resources. I’m rooting for both companies, but obviously disappointed in their share price action like most other investors.
Ex, I’m slowly accumulating both I-80 and Lion One at these levels—there are some technicals I like about them. I-80 may continual to slowly grind lower and Lion One may hit a low around $.20 but anyone with a position down here should see at least an easy double at the end of the bull market of the PMs in the future. Of course, if you’re a trader you might not want to wait that long. Having multiple positions in this sector protects you from being concerned if 2 or 3 positions don’t ramp higher right away.
Good thoughts Doc. Yeah, I’ve been considering adding another tranche in both at these lower levels to bring my cost basis down some. To your point, I’ve got plenty of other exposure to the gold and silver stocks that are doing just fine, and many positions have been in the green for a while. Lion One and I-80 have just underperformed the rest of the PM pack up through present… but, maybe they bothkick it back in and outperform for a period once again (as they have also done in the past).
Steve, I don’t own or follow LIO but technically it looks like a buy to me. That’s big picture. I’m not going to give a refined short term setup. The low in March very likely marked the end of the 4 year downtrend.
https://schrts.co/qpdxtNYq
https://tinyurl.com/2s3p8vwn
Gold Week: Double Top
Updates To Come
The double top in gold vs silver miners is what interests me. The sector is presenting massive long term opportunity so I continue to buy.
Gold:SILJ weekly:
https://stockcharts.com/h-sc/ui?s=%24GOLD%3ASILJ&p=W&yr=5&mn=0&dy=0&id=p93081056824&a=1687492255
Matthew, buying on the way down, in these limited precincts, is the right move for those with deep pockets. Absolutely!
Others are restricted by monetary circumstances.
Both are right.
De-Dollarization: The Trend Continues
Articles, charts, then more articles…
John Rubino – Substack – May 25, 2024
https://rubino.substack.com/p/de-dollarization-the-trend-continues
It’s a joke, The Emperor hasn’t had any clothes for a long time. Americans are going to feel what it is like to compete with the rest of The World. It will be a good thing because they will start to realize what life is all about! Instead of imposing their values on others who think differently. America will be great again, but they must feel the pain, similar to what happened during “The Great Depression”. DT
I become suspicious when dates are hard to find, and here at least one of the important reference articles is at minimum from March, per the comment section!
The Crime Syndicate operates on both sides of the ‘curtain’.
Bob Dylan The Times They Are “A-Changin” what’s old is new again, look back to the future! DT😉
A-Changin’ for the better? It ain’t necessarily so, always.
Hi Rufust, Bob Dylan’s song was released in February 1964. There are a lot of similarities and differences between then and now. It is not always for the better if it was, we wouldn’t be in the mess we are today. DT
‘You’d be surprised how much the world don’t change’–Rodney Dangerfield, Philosopher.
Feb. 1964? Just a few months after the JFK assassination. With a criminally insane occupant in the WH. times weren’t changin’ for the better.
SPY’s 5 week rise off of last month’s low is not nearly as bullish as most seem to think, at least not yet.
https://stockcharts.com/h-sc/ui?s=SPY&p=D&yr=1&mn=0&dy=0&id=p14359038800&a=1687689601
As always appreciate all the interviews/work from the Ker crew and all the input/comments from everyone. Been a long time since I’ve been fully caught up and up to date.
I’m wondering if I’m becoming overconfident with things. Feel like I might be setting myself up for the big blindside like every contestant on Survivor has happen when they get too confident in their situation.
I’m fully buying into the copper narrative between a forced EV(I don’t buy into it working without huge improvements in technology) infrastructure needs for said EV and AI’s needs as well. Which also leads to the need for more power. Uranium is the longer term solution( sorry to my mate who works in fusion at ITER right now and is moving to private sector which is jumping in big time ….but that’s for another generation not in my lifetime) but even the SMR’s are years in the making and needs are now….solar aka silver is the near term solution.
So there you have it. I’m big on copper and silver with uranium sliding in around 3rd or 4th as I’m still intrigued by nickel especially with magna being so close to all the new battery plants in Ontario.