E.B. Tucker: Gold Stocks, Nobody Cares!
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E.B. considers mining stocks to be bad investments as they are capital intensive and they often have operational problems. However when the price of gold moves these companies are some of the most exciting markets to be in. These are cyclical stocks and you want to own them when they begin to move higher. Most investors have no exposure to this sector.
Mr. Tucker feels it’s prudent to have some of your portfolio invested with major companies. You want assets that will do well through the worst of situations, as well as those that provide cash flow. You also want some money in more speculative trends as those are what will build wealth.
Gold has had a better year than most people realize it’s made higher highs and higher lows throughout 2017. He talks about the Golden Triangle area in Canada where mining companies have been reporting fantastic results. Everyone is focused on bitcoin, but gold itself will inevitably shine again.
He discusses the reasons to own Metalla Royalty as these financing streaming deals result in great cash-flow benefits along with real tangible exposure to the metals. The stock is trading at only 6.5 times earnings and they only make gold and silver finance deals. Currently, few investors seem interested in Metalla and they can’t pay people enough to hold the stock.
He discusses Hive which is a publicly listed blockchain infrastructure company. They have a dozen data centers and are well financed. They have spent 200 million building data centers for cryptocurrency mining.
He thinks that people will get hurt by cryptocurrencies as there is a belief that they will replace the existing financial system. These ideas are delusional as governments can declare whatever they want as legal tender. People need to be realistic about their holdings.
Talking Points From This Week’s Episode
• Blockchains will become useful for keeping track of physical assets.
• Recent exploration discoveries have been largely underappreciated.
• The opportunities and risks in the cryptocurrency space.
• Mining stocks are still undervalued.
E.B. Tucker is is on the Board of Directors at Metalla Royalty & Streaming Ltd. and is also the senior analyst for The Casey Report. E.B.’s been profiting from crisis for years. In early 2009, he realized that the US housing bust would create a generation of renters. He raised money and bought a large portfolio of single-family rental houses at rock-bottom prices… as low as 10 cents on the dollar.
E.B. was also a founding partner and managing director of KSIR Capital Management, an investment firm focused on gold and silver equities. He knows the gold and silver business inside and out, having visited mines in many countries. He holds a B.Sc. in Business Administration with a focus on Finance from the College of Charleston in Charleston, South Carolina.