Jon CaseTorex Gold ResourcesTXG.TOTOP PICKJul 26, 2016

At 5X earnings, TXG is very cheap indeed. While it is down 7% in 2023, it is still up 55% over 52 weeks, so may just be consolidating prior gains. Revenue is ramping nicely; EPS is being impacted by inflation and other factors and is expected to decline in 2024. The last quarter was ahead of estimates, but estimates have been ticking down. It has $320M net cash so is in excellent financial shape. Cash flow generation is good. We think it is certainly attractive on valuation, and its cash helps provide some comfort. We would see it as buyable. 
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One mine is winding down, but another is ramping up production. Well funded, cash on the balance sheet. No debt. Trading at 3-4x operating cashflow. He took profits when it ran up.

Some of their Mexico properties have geo-politcal risk, though he likes Mexico as a whole to mine. They have cash and are getting this Mexico mine into production. They just had an EPS miss. This could be a buying opportunity.

Great deposit. Had some start-up issues but solved them. Issues now with safety and work blockages in Guerrero, Mexico, which is a tough place. Things they can't control are killing them.

He loves their asset. Open pit in Mexico. It is extremely cheap on a valuation basis. Striking workers blocked the entrance to the mine, shutting it down. They have quite a bit of debt. You want to manage your risk by having it as part of a larger basket of these equities.

(Top Pick Jul 12/16, Down 22.42%) They are in Mexico and are a low cost producer. They have higher grade material they have discovered that won’t come on stream for a couple of quarters. They showed an earnings miss a couple of quarters ago and it makes this a great entry point. This is his only gold holding.