My top stock pick for this month is small cap exploration stock Norseman Silver, which trades on the TSXV as NOC and on the US OTC as NOCSF. As you can tell from the name it’s a silver stock. What is important about that is that the price of silver and gold finally have broken out in February after spending over a year consolidating. Just as people pretty much gave up on precious metals they began to make the start of a big move. Check out this chart of silver.
As I said last month, I see gold and silver as the best buys now from an investment standpoint as they have not moved up as much yet as everything else. That means one can buy them now and have a safe entry point with a definable stop loss point at their December and January lows.
While gold went through its key long-term resistance level in the $1880-$1890 range last month, silver went up through the $24.00 price barrier. Both metals tend to trade together, but at the start of a new big bull move gold tends to breakout and lead first and then money starts to flow into silver to push it up at a faster rate as you get further into the rally.
What is key, though, is that the big cap mining stocks tend to breakout and jump first at the start of a rally and the juniors tend not to get going until a few weeks later. So, there is still a great opportunity to buy into the top small cap junior mining and exploration stocks even with gold over $1900. In fact, that space as a whole actually traded down in January, so many of the stocks in it are still cheap.
This is the case with Norseman Silver, as you can see from this chart.
As you can see, Norseman shares traded down in January towards 17 cents and then bounced back up just under 25 cents in February. One can buy now and see that January low as solid support. This makes for a clearly defined entry point for great upside on this current metals run.
Norseman is trading with a market cap of roughly $9.23 million USD. Most small cap mining stocks get to market caps over $25 million during bull runs.
The company also launched an accelerated drill program, which should bring it positive news flow.
Norseman’s property portfolio includes the Cariboo, Silver Vista and Silver Switchback projects, all based in mining friendly British Columbia. In March of 2021 the company also issued a LOI “with the Bussandri-McMillan partnership (the “Optionors”) to acquire a 100% interest in the Taquetren Silver Project (the “Project”), which is located in the Rio Negro province of Southern Argentina. The Optionors have agreed to work exclusively with Norseman.”
This project, Norseman explained in a press release, “covers approximately 285 square kilometers (110 square miles) and is located the within the Somun Cura Massif. The geologic setting of the Project is calc-alkaline, bimodal Jurassic Taquetren Formation volcanic rocks, within the Gastre fault zone. The Gastre fault system is a transcontinental shear zone, which extends from the Andean Cordillera to the Atlantic coast resulting in a series of half grabens and tectonic basins and associated faulting. Work to date has suggested favourable hydrothermal alteration. However, the Company wishes to note that the Project is an early-stage exploration property.”
Sean Hurd, President and CEO for Norseman, commented: “We are very excited to potentially enter one of the most under-explored mining districts in Argentina. The region contains significant discoveries, Patagonia Gold’s Calcatreau (Gold-Silver Deposit) and Pan American’s Navidad (one of the worlds largest undeveloped silver deposits) with a resource in excess of half a billion ounces of silver. Our team and our new partners have extensive experience in Argentina, and in the Rio Negro province in particular. Our entry into Argentina could be a significant move forward as we seek to expand Norseman’s commitment to becoming a premier silver exploration company.”
Last July Norseman announced a private placement raise of up to $1.5 million to augment its existing $1 million in cash on its balance sheet and to fund a drill program on its B.C. properties and advance its Argentina project, which being new for the company, has the potential to really get people’s notice.
“- Located in the Navidad-Calcatreau Mining District, Argentina”
- – “An under explored district hosting one of the largest silver deposits in the world”
- – “In the SW of Rio Negro Province ~30 km N of the border with Chubut Province”
- – “Comprised by 3 cateos (Prospecting Licences) selected to cover key stratigraphic and structural elements associated with the newly-discovered Navidad-Calcatreau mining district.”
“- Argentinian team includes first-hand participation in the discovery of the Navidad Silver Deposit (M&I: 632M Oz Ag contained in 155.2 Mt @ 127 g/t Ag, 0.85% Pb, 0.05% Cu, 150 g/t AgEq)- Permits have been obtained to conduct initial geological, prospecting and geochemical sampling with work is commencing May 2021- Accessed by high quality and well maintained paved and gravel roads.”
Last week the company announced that their exploration effeorts “successfully discovered a low sulphidation (LS) epithermal vein system within its 285 sq. km Taquetren project in Rio Negro, Argentina.”
“Ongoing mapping and sampling in the area of the recent discovery is underway and the exploration team has been expanded to facilitate an accelerated regional exploration program. No evidence of previous exploration on the ground has been identified. The Company staked an additional 300 sq. km of ground in Q4 2021 that is contiguous to the original Taquetren concession areas to expand the property boundaries. The exploration team has been expanded to facilitate an accelerated regional exploration program.”
“Field observations and the collected samples confirm the existence of a vein system is located on the edge of a circular structure and along the trace of the NW-SE-trending Gastre Fault System, as well as NE-SW-tending Nord-Patagonico Fault System. Regionally, the mineralized LS epithermal system is located on the edge of one of the previously identified circular structures, reinforcing the model of the mineralization linked to a mega caldera. Geochemical results from the Q4 exploration program will be released when available.”
“Field observations and the collected samples confirm the existence of a vein system along the trace of the NW-SE-trending Gastre Fault System, as well as the NE-SW-trending Nord-Patagonico Fault System. Regionally, the mineralized LS epithermal system is located along the edge of one of the previously identified circular topographic structures, reinforcing the model of the mineralization linked to a mega caldera. Geochemical results from the Q4 exploration program will be released when available.”
“Taquetren is located in the Navidad-Calcatreau Mining District, in SW Rio Negro Province, and approximately 30 km north of Chubut Province. Accessed by high quality and well maintained paved and gravel roads. This under-explored district hosts several deposits, including Navidad, one of the largest silver deposits in the world (M&I: 632M Oz Ag contained in 155.2 Mt @ 127 g/t Ag, 0.85% Pb, 0.05% Cu, 150 g/t AgEq).”
You can find the full corporate presentation for Norseman here in PDF form.
So, Norseman is in an interesting key moment for the life cycle of a small cap mining stock in a key moment in the precious metals and mining stock rally, which I think it likely to develop into a powerful run as this continues. If I am correct the money flow into junior mining and exploration stocks has barely begun. Therefore, Norseman Silver is my top stock pick for this month.
-Mike
Disclosure: Because Norseman Silver is a small cap stock with a market cap of less than $100 million USD Mike Swanson has put himself in a trading blackout on Norseman Silver and will not buy or sell a share of its stock for at least 30-days from the date of this post (03/01/2022). Wallstreetwindow.com, is owned by Timingwallstreet, Inc., which is being compensated by a third party (Leadgopher LLC DBA Pinnacle Ad Network) to conduct an investor awareness advertising and marketing campaign for Norseman Silver. This third party paid Timingwallstreet Inc., $16,000 USD to produce and disseminate this and other similar articles and send traffic to them through paid advertising campaigns for 30-days from the date of this post (3/01/2022). This compensation should be viewed as a major conflict with our ability to be unbiased, more specifically: This communication is for entertainment purposes only. Never invest purely based on our communication. For more on trading risks read our policy statement by clicking here.
