The strategy of going after the majors seems to be adopted by all the drillers. So what makes GEO able to displace others ? Furthermore, if the financing window opens up (and it will), do you think that juniors will pay old drilling bills or will want to spend in on new drilling ? On the flip side, when it rebounds, there will be less competition : for exemple, Orbit Garand exited West Africa totally after leaving Burkina.
Dave Harper mentioned also Mali during the quarter : this is another country with problems, Capital was mentioning a slow down in their last quarter.
So I might be wrong, but there seems to be safer places to wait for a rebound. Capital is expanding in NA with a huge Barrick contract in Nevada plus Chrysos expansion, FAR is expanding in the States too and is probably in play with the main shareholders now able to sell, and MDI is the 800 pound gorilla still throwing out cash flow and set up for the supercycle.
I'm not sure to your first question. I think there would be some sort of capital upfront and the existing contract renegotiated. I agree that most have been moving to senior producers and the play may be to get more exposure to juniors for large leverage to gold. I imagine that if capital returns to the juniors then much of the geographical worry will be forgotten by the street as well. But that is speculation on my part.
There probably are safer places to wait for a rebound. I am not sure exactly where to put the capital if I sold GEO here. That is what has me on my hands at the moment. Maybe just MDI and chill. IT doesn't help that it's reporting season so keeping up with existing positions has me busy.
I would consider myself a generalist, but that may be an insult to the other generalist. Maybe more of a generalist in training.
Dave Harper lost all of his credibility several quarters back when he talked glowingly about a quarter that was already underway and then laid a big fat egg. It hasn’t gotten any better since, and from what I can tell their move into South America has been poorly executed. Harper wants to retire so there may be a play here at some point, but personally I wouldn’t touch it unless it was at absolute fire sale prices like a buck Canadian.
Their operating jurisdictions have huge risks, and management isn’t executing. There are much better ideas out there IMO.
Thanks for the comment. I do appreciate the candidness. I think the decision to start telling the story to investors was timed with the peak in margins. There were some data points that I overlooked and (as usual) weren't really discussed. I don't know how well the move into South America has been executed. I liked the diversification away from Africa to some degree, but didn't acknowledge the risks. Thankfully I kept position size relatively small from the start.
I honestly debated taking GEO and rolling it into FAR. I do like the gold exposure from GEO but I would be open to hearing a better way to get exposure.
I used to have a huge position here. I was probably one of the top 4 or 5 shareholders outside of management, but I bought it back in 2020 in the 1.50’s. I’d been easing up and flat out dumped it all with the earnings debacles early last year. The one thing I did here that is a rule for me, and has always served me well is to dump when commentary made partially through a quarter doesn’t line up with the ultimate results for that quarter.
That tells you one of 2 things
1. Management is incompetent
2. There was a dramatic shift in business to the downside as the quarter progressed.
Those are both pretty terrible options. You may be right about peak margins. I don’t have any special insight, and you might be right to own it here, but it’s in the permanent penalty box for me.
Yeah these are all completely fair points. Microcaps are such hit and miss with management and their ability to run the business as well as communicate with investors.
The strategy of going after the majors seems to be adopted by all the drillers. So what makes GEO able to displace others ? Furthermore, if the financing window opens up (and it will), do you think that juniors will pay old drilling bills or will want to spend in on new drilling ? On the flip side, when it rebounds, there will be less competition : for exemple, Orbit Garand exited West Africa totally after leaving Burkina.
Dave Harper mentioned also Mali during the quarter : this is another country with problems, Capital was mentioning a slow down in their last quarter.
So I might be wrong, but there seems to be safer places to wait for a rebound. Capital is expanding in NA with a huge Barrick contract in Nevada plus Chrysos expansion, FAR is expanding in the States too and is probably in play with the main shareholders now able to sell, and MDI is the 800 pound gorilla still throwing out cash flow and set up for the supercycle.
GL.
I'm not sure to your first question. I think there would be some sort of capital upfront and the existing contract renegotiated. I agree that most have been moving to senior producers and the play may be to get more exposure to juniors for large leverage to gold. I imagine that if capital returns to the juniors then much of the geographical worry will be forgotten by the street as well. But that is speculation on my part.
There probably are safer places to wait for a rebound. I am not sure exactly where to put the capital if I sold GEO here. That is what has me on my hands at the moment. Maybe just MDI and chill. IT doesn't help that it's reporting season so keeping up with existing positions has me busy.
I would consider myself a generalist, but that may be an insult to the other generalist. Maybe more of a generalist in training.
Are you trying to replace it with something mining related or just something?
Would like to keep it related to precious metals and to something I can understand. Ideally Canadian listed.
Dave Harper lost all of his credibility several quarters back when he talked glowingly about a quarter that was already underway and then laid a big fat egg. It hasn’t gotten any better since, and from what I can tell their move into South America has been poorly executed. Harper wants to retire so there may be a play here at some point, but personally I wouldn’t touch it unless it was at absolute fire sale prices like a buck Canadian.
Their operating jurisdictions have huge risks, and management isn’t executing. There are much better ideas out there IMO.
Thanks for the comment. I do appreciate the candidness. I think the decision to start telling the story to investors was timed with the peak in margins. There were some data points that I overlooked and (as usual) weren't really discussed. I don't know how well the move into South America has been executed. I liked the diversification away from Africa to some degree, but didn't acknowledge the risks. Thankfully I kept position size relatively small from the start.
I honestly debated taking GEO and rolling it into FAR. I do like the gold exposure from GEO but I would be open to hearing a better way to get exposure.
Dean
I used to have a huge position here. I was probably one of the top 4 or 5 shareholders outside of management, but I bought it back in 2020 in the 1.50’s. I’d been easing up and flat out dumped it all with the earnings debacles early last year. The one thing I did here that is a rule for me, and has always served me well is to dump when commentary made partially through a quarter doesn’t line up with the ultimate results for that quarter.
That tells you one of 2 things
1. Management is incompetent
2. There was a dramatic shift in business to the downside as the quarter progressed.
Those are both pretty terrible options. You may be right about peak margins. I don’t have any special insight, and you might be right to own it here, but it’s in the permanent penalty box for me.
Yeah these are all completely fair points. Microcaps are such hit and miss with management and their ability to run the business as well as communicate with investors.