NXG - Sector: Basic Materials---Industry: Gold & Silver

[Holygrale]

Gold is in play..........and so is NXG.     

Chart looks good........

[Holygrale]

Upgrade to BUY..............by UBS!   

[Ramsburg]

Note: Michael will update this trade later, he asked me to add this position to the 3SOV portfolio today.

Trading Plan:
Buy NXG today at or near the open.

Regards,

[poppintito]

the gold hype has gone..the timing for this pick is not that good

[lalitha0]

HI

It looks to me that this has more downside right now, before it starts going up - with price closing below 50 MA. It will be interesting to watch what will happen tomorrow.

I am not in this yet, so I can watch without being nervous.

Lalitha

[dhiraj19]

Hi Lalitha0,
What do you think are the entry price points? I am also waiting on sidelines?
Thanks,
- Dhiraj

[lalitha0]

Hi Dhiraj,

If I could call entry and exit points I would be rich!

To my limited knowledge today seems to be a good day to get in since RSI went above 50 and the price is above 50 MA and MACD is turning up - would be better if it is above zero.

They also have copper so it is not a bad stock, but I am finding other good ones, so I am not getting into this one.

Good Luck!

[lalitha0]

Note: Michael will update this trade later, he asked me to add this position to the 3SOV portfolio today.

Trading Plan:
Buy NXG today at or near the open.

Regards,

When 

Lalitha

[Stocky2000]

 

[trexkerry]

The frequency that this portfolio is updated is terrible.  Not just this stock which we have been waiting since August 16th for, but in general the only ones updating the 3SOV plays are the members.  3SOF should consider dropping this portfolio if it is not going to be updated or even monitored!  So back to NXG, it is down another 7% today...any thoughts?

Note: Michael will update this trade later, he asked me to add this position to the 3SOV portfolio today.

Trading Plan:
Buy NXG today at or near the open.

Regards,

When 

Lalitha

[poppintito]

my thought is that nxg along with egy are value stocks ..but not a good time to touch commodities stock for now

for nxg..a break down of the triangle..we may see this go lower from this point on

watch closely for turn around tho...

[usedcasting]

Any chance of an update here ? 

uc.

[rickjust]

Note: Michael will update this trade later, he asked me to add this position to the 3SOV portfolio today.

Trading Plan:
Buy NXG today at or near the open.

Regards,

[Michael]

Well let me first apologize for the lack of update on NXG and 3SOV in general. I am really busy on my daytime job and even though Northgate seems to be a very simple pick it is actually quite complicated.

It is simple from a valuation point of view. NXG generated 65 million USD last quarter and its market cap. is 692 million USD. Their cost of Gold production offset by the  profit from copper and Silver production that is kind of a byproduct is basically zero (actually negative with 44 USD last quarter!) making them very robust in case of declining gold prices.

Now that is the simple part of this pick. The problem is that their existing mine (Kemess South) is fast being depleted and production will stop within the next 3 years 

So the reason for picking is NXG is not the existing cash flow and profit as this soon will only have historical interest (even though they most likely will end up with a large bag of money) but rather the fact that their two existing projects (Kemess North and Young Davidson) and the strategic alternatives the company have is basically considered to be Zero with the existing valuation of the company.

Well I think that is wrong. I believe that NXG has a great management team and that they will most likely receive permissions to go ahead with the two projects and or find alternative investments for their healthy cash flow before KS is depleted. I also believe that there is a very realistic opportunity for a takeover bid in the future (which management in the last CC indicated they would consider).

I intented to write a lot more about KN and YD but have not had the time. I am however still convinced that NXG will turn out to be a good investment long term so we will hold the stock for now.

[Michael]

the gold hype has gone..the timing for this pick is not that good

Hmmm that was a very prophetic statement and for sure the timing was bad. We have suffered a great deal with Northgate

But the gold fever might come back:

China has the world largest reserves off foreign exchange (1 trillion dollar) and the want to diversify away from USD. Interestingly they also have one of the lowest percentages of gold reserves among the major central banks in the world. I don't think the financial markets fully have understood the impact of this. The currency markets has started to react but only slowly. It seems that a lot of investors still consider US to be an economic superpower.

Anyhow as said in the Valero thread even the best fundamental stocks need a trading plan and it is unforgivable and unnecessary that we have allowed Northgate to cause a 16% loss for 3SOV.

I still believe this is a great stock and my believe in gold and the most of the other metal (and energy) commodities is a strong as it was 3 month ago but lets put a safety net under this investment!

We will close our NXG position if it goes below 2.95.