Apogee Minerals: An *Undervalued* Winner Among Peers of Junior Silver Miners

With the rising white metal price, junior miners going into production by 2015 are poised for rich takings. Here is a winner that I plan to build positions with as soon as the market opens on Monday morning.

Apogee Minerals Ltd ( www.apogeeminerals.com ) is a junior exploration and development company with a focus on advanced stage silver, zinc, and lead deposits. Apogee’s primary project is the Pulacayo-Paca property in Bolivia with an option on 80% of the Cachinal project in Chile.

KEY ELEMENTS OF A WINNER:

Projects:

1) Not only was the Pulcayo silver mine the second largest silver mine in the history of Bolivia but it is also widely disputed as the richest mine in the history of the world. History and numbers indicate that the mining production came to a halt because of under-capitalization, under-investment, and poor pricing not because of exhausted reserves or low grades.

2) The Pulacayo (NI 43-101), Paca (pre-feasibility), and Cachinal (NI 43-101) combined have rich takings of 80M-plus oz of silver.

3) In this type of economy, it will be hard to secure funding to mine that much silver but this management has a proven history of an ability to raise money e.g. recently closed a private placement financing.

4) Excellent alternative leverage to zinc & lead prices.

Shares Structure:

1) Management has been careful to limit shares dilution to only 186.8M.

2) Major institutional shareholders are Sprott Asset Management, Aberdeen International, Pinetree Capital, and China Mining United Fund.

Infrastructure: Excellent infrastructure from existing mine, with water reservoir, underground development, rail lines for water. With these key elements for rapid development in place, management expects to start producing in a mere 12-26 months.

Management: As part of the Forbes & Manhattan Group (ForbesManhattan.com), Apogee’s management team and a number of the board are part of the Forbes group, which have had “tremendous success” in the last decade with advancing mineral exploration.


Risk Level:

1) Moderate risk as a past producer, advance discovery, and in the top7 Silver producing countries (www.silverinstitute.org). However, investors should use caution with investing in Bolivia as Evo Morales, the president of Bolivia, has bullied to nationalize a lot of the mining industry. But there’s talking the talk and there is no indication in 2010 that he will walk the walk.

2) But on a positive note, Apogee is undervalued relative to Silver peers with comparable inventories because of this political situation.

3) In any event, Behre Dolbear Group ranks Chile (http://www.dolbear.com/Publications/CountryRankings.pdf), Cachinal property, as the #3 country for mining out of 25 countries using seven criteria ranging from social issues to currency stability.


Financials:

1) 250% increase of insider trading since September.

2) With $34.8M market cap, Apogee has strong overall fundamentals among peers.

3) High liquidity of 781,678 average volume, which is very high among the list of 40-ish junior miners on my watch list.

The upshot of these key elements clearly indicate that Apogee Minerals inon pace to advance its highly valued projects within the next 12-26 months. I plan to build positions within the next 72 hours. More postings on my next analysis soon.

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SOURCES:

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One Response to Apogee Minerals: An *Undervalued* Winner Among Peers of Junior Silver Miners

  1. Robert Donaldson says:

    Thanks for the info..good stuff ..I’m getting in on Monday April 5 2011

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