Question: What are the chances with this gold exploration company ?
i'm trying to figure out this company but have trouble making a decision on it .
insiders have been buying shares on the open market and financing the company with there own money thru private placements .
but the shares price only goes down .
the property was being mince with picks and shovel by local miners till last february and had to leave when arrowhead took over the property for exploration .
there was 3,000ouncess of gold recovered ny these local miners i just a few months .
is this a good stock play ?
Answer:
Bit of a punt. The operation seems pretty basic (like the trench digger). Any processing plant? What exactly was the 3000 oz of gold mined in a few months? Obviously not pure gold, but presumably gold ore. How much did it cost to mine and process? You really need to see JORC reserve figures.
Ok...you were not happy that I really did not pay attention to Arrowhead Gold in your last question so I dug a bit deeper and I will explain what I found to support my initial impressions from the chart
http://stockcharts.com/h-sc/ui?s=AWH.V&p…
First of all this chart does Not scream BUY to me....lots of indecision to me and that is why I gave it an initial pass.
But I looked into this company a bit more. At their so called drilling results.
http://tmx.quotemedia.com/article.php?ne…
I take a very dim view of this kind of reporting.
"Sample PRX-01 returned 1940.0 grams per tonne gold (gpt Au) or 56.8 ounces per ton gold (opt Au). Sample PRX-02 returned 503.8 gpt Au (14.71 opt Au). Sample PRX-03 returned 791.3 gpt Au (23.28 opt Au). The samples are selective grabs taken from quartz boulders recently excavated from Zone A on the Puruni Property. Zone A is marked by a strong induced polarization anomaly and a coincident gold-in-soil geochemical anomaly."
These are NOT drilling results...they are running around taking grab samples of quart with gold in them....This would be the mother of all mines if there was 56.8 ounces of gold for every ton of ore processed...that would mean that each ton of rock would be worth 56.8 x $1665 = $94,572.00
That is impossible....
No one disputes that there is some gold in the area....do you think this place would be abandoned by the other prospectors if they found this kind of money lying on the surface of the ground????
But the company needs money to operate so they pump up these results.
http://tmx.quotemedia.com/article.php?ne…
It is now six months later in the above news release and they STILL have not done a proper drilling program....now if I had a property with $94,000/ton of gold potential....I think I would be in more of rush to drill that area more to investigate that opportunity....doncha think?
****************No...I would avoid this mine like the plague. ***************
Contrast those supposed drilling results with drilling results from Roxgold [TSE Venture:ROG]
http://tmx.quotemedia.com/article.php?ne…
this is professionally done...not cherry picking rocks.
I'd not put money into ArrowHead at all.