Silver Stock Report #12

Silver Stocks–Comparative Valuations  
Weekly Report #12
by Jason Hommel
The Silver Stock Report

Friday, Dec 5th, 2003

This week’s report lists 87 silver stocks.  There are 28 silver stocks that list reserves, resources (and exploration potential.) which I calculate by using my “ounce in the ground” forumula.  There are 31 explorers.  There are 28 additional silver stocks with incomplete information.

If you are an Accredited or Sophisticated investor and want information I may find out about private placement opportunities in some of the very best silver stocks in my opinion, (This is not a solicitation for any stock, and I’m not brokering any securities) email me with PP in the subject field:  

To see the available reports I’m offering for sale, see The Silver Stock Report

To read about my religious bias, see my other website, There are two essays near the top of the page that explain why I believe the entire world will return to using gold and silver as money again.

If you want to receive an email notice of when and where this FREE weekly report is published, sign up at  Anyone who signs up will also get a FREE e-book that explains the bullish case for gold and especially silver.  If you have studied the silver market at all, then the time has come that you ought to be a teacher, and you ought to explain the silver story to all who will listen. is designed to help spread the word. I suggest you email the url to your address book.

Price of silver is $5.46 as of Friday, 2:10 PM West Coast US, which was used to calculate the following figures. The CAN $ / US $ conversion factor is .7661.  I will use .77 for ease.  

Stock Symbol / Silver oz. “in ground”** for 1 oz. silver’s worth of stock. / price change since last week /  additional comments (EXPT is “exploration potential”) 

  1. HL                                     .46 up –current producer(gold bonus)
  2. CDE                                  1.1  even –current producer
  3. IPOAF.PK                         1.9  up –current producer
  4. GRS  GAM.TO                  2.0  even –current producer
  5. ECU.V                               2.2 even –(5.9 EXPT)  –50% gold bonus
  6. MAI.V  MNEAF.OB            2.5 down   –just raised $6.6 mil, exploring for more silver.  (gold bonus)
  7. SIL                                    3.7 up  –large zinc bonus, low grades.
  8. KBR.V                               3.9 up 
  9. * CFTN.PK                        4.3 up — (43 EXPT)
  10. * CZN.TO  CZICF.PK         4.9 up–large zinc bonus, high grades, low start up costs, great exploration potential
  11. FSR.TO                             5.4 up  –current producer
  12. TM.V  TUMIF.OB TUY      6.3 up — (12.4 EXPT) bonanza grade silver discovery late Nov. 2003
  13. PAAS                                 6.8 up  –current producer
  14. WTZ  WTC.TO                  7   up   — (30 EXPT)
  15. SSRI                                  8.4 up–multi-property company, understands silver story
  16. MGR.V  MGRSF.PK            8.7 up
  17. DNI.V                                10.5 up  –exploring Clifton’s property.
  18. ASM.V  ASGMF.PK            13 up –owns 49% of the Avino mine. + 4 other silver props. (silver bonus)
  19. * SVL.V  STVZF.PK            13 up  –(24 EXPT) –growing resources; acquiring silver properties.
  20. MMM.TO                           13.3 up –I still need to confirm.
  21. ADB.V                                13.9 up –actively expanding resources. (Huge gas bonus)
  22. * SRLM.PK                         14 down –(30 EXPT) near the Sunshine)
  23. FAN.TO  FRLLF.PK            14.7 even  –(25 EXPT) low grades, silver 1/3; also gold & zinc.
  24. HDA.V                                15 up   –very tiny, no debt, zinc bonus, low start up costs.
  25. * EXR.V  EXPTF.PK            16.7 up  –significant zinc bonus 60% zinc, 25% silver
  26. MAN.TO  MMALF.PK          21 up  –Protests in Peru, and Peruvian government demands, hurt the price.
  27. * MNMM.OB                       22 down  –60% copper bonus (low grades), start up ~ $250 mil
  28. UNCN.OB                            36 up  –lease expiring on largest property in mid 2004.

* = I own shares

Explorers (by market cap):

  3. TVI.TO  TVIPF.PK  –current producer of a dore silver bar 96% silver, 4% gold
  4. * CDU.V  CUEAF.PK  42-71 “exploration potential”
  5. * AOT.V ASOLF.PK — owns percentage of Cardero, CDU.V
  6. MCAJF.PK     8.3
  8. MAG.V
  10. * NPG.V  NVPGF.PK   23-114  “exploration potential”
  13. * MMGG.OB
  14. IAU.V  ITDXF.PK     15
  16. * GNG.V
  17. BGS.V
  18. NJMC.OB
  21. EXN.V 5.22              
  22. SHSH.PK
  24. LEG.V
  25. SPM.V
  26. BBR.V
  27. * CEV.V CVEEF.PK
  28. ROK.V
  29. ITRO.OB

* = I own shares
** = “in ground” counts all “silver oz. in the ground” as the same, but they are NOT EQUAL.  Some are more certain and others are more speculative.  Some are higher grades, some are lower grades.  They range from most certain to least certain such as: “proven & probable reserves,” “measured, indicated, inferred resources.”  This single number next to each stock symbol above represents the approximate number of ounces of silver in the ground you are buying title to when you invest the equivalent of one ounce of silver by buying shares in the company at current prices.  (It does not include zinc, or copper, or lead, but it does include gold at a 1:10 ratio of gold:silver.)

At, they add 100% of proven & probable reserves, but only 70% of measured & indicated resources, and only 50% of inferred resources.  That might be a better way to calculate things than I’m doing now.  

To quickly “tab” down to the company you are interested in, note the symbol. Then hit “control-F” to “FIND” the symbol below. 

WEEKLY COMMENTARY (All new in this section):

A few commentators at the gold show in San Francisco suggested that perhaps people will be selling precious metals stocks in January to take profits then, rather than now, in order to postpone paying capital gains taxes for a year.  Thus they speculated that perhaps we could see a correction in metals stocks in January.  I think they fail to see that it works both ways.  Perhaps they have blinders on, and are thinking that tax laws only apply to people in the mining industry, I don’t know.  But my point is this:  People who have gains in the Dow and tech stocks but who are just only dabbling in the gold and silver stocks, but want or intend to buy more, will likely also want to postpone selling their Dow and tech stocks in order to raise cash for the metals stocks.  Thus, we could see a huge run up in the metals stocks starting in about January!  If you look back to 2002, you see a huge run up in the metals and metals stocks from January to June.  We could see this again for 2004.  And if precious metals investors know anything at all about the precious metal market, then they will take profits in the form of physical silver, which will really cause the silver boom to begin!

Look at the summary of the world silver survey:

Note, there is virtually no monetary demand. Note, the 2002 mine production (585 mil oz.) is greatly exceeded by industrial, photo, and jewelry demand. (838 mil oz.).  Note the chart on page five, “Supply from above-ground stocks”.

The difference between mine supply and industrial demand was met by a combination of three factors: 1.  Government selling, 2.  Private selling, 3.  Recycling

U.S. government selling is ending, as their stocks have run out, or will run out.  This factor will reverse, because the U.S. government will need silver to continue their coin program, and/or need silver when they wake up and decide they need to replenish their strategic stockpile for domestic security.  Silver is a war material.  China’s selling of silver will also likely turn into buying, as China will need silver for continued industrial development, or when they also lose faith in the U.S. dollar.

Private selling has been rapidly shrinking and is now almost ended, and should turn into buying, and become monetary demand.  Monetary demand is everything in the silver supply / demand situation.  It’s not now.  Now, it’s nothing.  But it will become something incredible, because the dollar is dying.

I wrote an article last week predicting that Silver Companies will buy silver, and urging Silver Companies to buy silver with their cash, to use silver as money, and sell silver as needed for expenses.  See

I urge my readers to email their own favorite silver companies to urge them to buy physical silver.  Here are the emails of several cash-rich silver companies: Hecla mining: $125 million in cash, Apex silver: $40 million, CDE not sure (over $38 million?).  Click below, and send them the url above, and a few of your thoughts on the issue.,,

I know a few people emailed a few companies last week.  But not enough did.  Action is required to change things.  If you do not demand that silver companies use silver as money, then the silver companies will lose money as the dollar falls and their dollar holdings, your investment money, loses value as silver goes up.  If you are an accredited investor, and if you gave money to a silver company, then demand that they hold their money in the form of silver until the day they spend it.  The silver mining industry probably has about $300 million in cash, now usable for exploration.  This is enough, collectively, to buy nearly all of the registered silver available at the COMEX, and could break the back of the manipulation, expose the crime to the wold, and cause silver to skyrocket, and cause the silver story to be front page news!  This would make your investment in silver companies really worth something.  

If you do not demand this change, then change will happen more slowly, but it will still come, due to all the gathering and continuing forces.  I’d just rather see the evil of the manipulation end sooner, since I’m already fully invested in silver.

The other thing I strongly believe all silver investors must do is to continue to take your profits of silver stocks, and buy physical silver with the proceeds.  I recommend keeping 20% in physical silver, and even more, as your stocks move up.  Thus, as your stocks move up more quickly than silver, you should be buying more and more physical silver to maintain, or increase, your silver holdings of 20-30%.  By the time silver stocks get “fairly valued” then you should be about 50% in silver, and 50% in silver stocks, or even more in physical silver.  One day, physical silver will probably run higher and faster than all the silver stocks.  Why?  Because the public will rush to buy silver.  Or there will be a short squeeze, or a default in the futures contracts.  It will be easier for the uninformed masses to buy physical silver than it will be for them to study the market of silver stocks.

So, you must own physical silver before it begins to run much higher.

General Commentary on Silver (slightly modified from last week):

The following is a “must read”:  Ted Butler’s best ever explanation of how silver is manipulated lower than it should be.

Sign the silver petition to stop the manipulation at the COMEX:

Ted correctly points out that a lower price creates excessive demand from consumers.  However, Ted Butler does not point out, and neglects to mention, that a perpetually low price also creates lack of demand from investors who are “trend investors”.  

I think most silver experts over analyse all the supply and demand factors of the silver market.  No factor is more important than monetary demand.  The force of photographic demand is like a light breese compared to the hurricane or tornado of monetary demand.  Monetary demand is everything.

To scare away investors–that is the entire reason silver is manipulated in the first place.  Only the trend investors can be deceived.  The problem is that nearly everyone is a trend investor.  So few investors understand value.  If people knew the facts and used their brains, the available above-ground refined silver would be gone by tomorrow, and the price would be well over $20/oz.  But don’t trust me, follow the urls and check the numbers:

    1,000,000,000,000: 1 Trillion dollars
          1,000,000,000: 1 Billion dollars
                1,000,000: 1 Million dollars
$33,000,000,000,000: World bond market yr end, ’01:
$20,200,000,000,000: U.S. bond market, yr end, ’02:
$11,700,000,000,000: U.S. stock market, yr end, ’02:
  $9,797,000,000,000: U.S. annual GDP, 3rd q.’03 est.
  $8,835,000,000,000: M3 (money in the banks) Oct. ’03
  $6,939,572,558,142: US debt, 12-4-’03
  $2,212,000,000,000: U.S. annual budget 2003 
  $1,860,000,000,000: World gold, 145,000 T @ $400/oz.
     $554,995,097,146: U.S. budget deficit, ending fiscal year, 09/30/’03
     $274,000,000,000: Market Cap of Microsoft
     $180,000,000,000: debt of Ford Motor Co.
     $140,400,000,000: US gold, 8117 T, @ $400/oz.
     $100,000,000,000: all the world’s gold stocks (estimated?)
         $7,000,000,000: all the world’s silver stocks (est. from this list)
           $352,000,000: 64 mil oz. of registered COMEX silver @ $5.50/oz.

It’s nice to see that Richard Russell is reading and commenting on the statistics I’ve gathered together.  On Dec 1st, at at
Richard Russell wrote:

Let’s go over a few statistics. The world’s bond markets are valued at well over $33 trillion. The US stock market is valued at around $12 trillion. The M-3 money supply in the US is about $8.8 trillion. That’s a total of around $55 trillion. I’ve heard that there’s around $8 to $9 trillion floating around outside the US. That takes the total to around $64 trillion of a fiat US currency. 

Against that all the gold ever produced since the beginning of time is estimated at $1.8 trillion at current prices. The estimate for all the world’s gold stocks taken together is around $140 billion. So we have around $1.9 trillion as a value of the entire gold universe (metal and stocks) as against around $64 trillion in paper money sloshing around the world. And I’m not even talking about world debt, which would be out in space.

Another interesting comparison is that the market cap of Microsoft is around $274 billion. This is about double the value of all the entire gold mining industry. Conclusion — gold stocks are cheap, and gold is cheap — and there are one hell of a lot of fiat dollars floating around.

It’s also nice to see that Richard Russell agrees with me that silver is too cheap relative to gold. Richard also wrote:

To boil it down to simplicity, what all this means is that gold is in a primary bull trend as is silver, but silver is “too cheap” compared with gold. For this reason, I’m suggesting that subscribers who own no silver stocks take a position in a few of the following — PAAS, SSRI, CDE, SIL, HL. Many subscribers may want to take an equal dollar position in each. 

Now, Richard Russell, reportedly, has over 10,000 subscribers paying him about $250/year annually.  This means Richard is paid by his subscriber base over $2.5 million a year for his market commentary, and it also means his word can really move the markets–especially the tiny world of silver stocks.  Given that he is more bullish on silver than on gold, and obviously bullish on silver stocks, it only makes sense that he would recommend the silver stocks with the largest market caps.  Otherwise, his recommendation could move the markets too much in some of the smaller companies.  

I am also overjoyed to see Richard Russell ready to throw Technical Analysis away, and focus on the fundamentals and values.  Note again what Richard Russell wrote:

Under the above circumstance, how am I or anyone else to know at what point to buy more gold or gold and silver stocks? Technical analysis, cycles, RSI, momentum, stochastics, algorithms, over-bought and over-sold methods? FORGET THEM. I doubt they’re going to work at this point.

So, what do all those stastics mean?

For a while I was using M3 and dividing that by the US gold (261 million ounces), which implies the us dollar is 84 times more valuable than it should be, and that gold should hit $33,850/oz. after the fraud is destroyed.  Today, I realize I need to add in the Bond market, because bonds are an asset class designed to siphon away and replace real money, which is to say, gold.  This gives a price of $111,111/oz. for gold.  At $400/oz, this implies that US bonds and paper currency is 278 times more overvalued than gold.

Gold is overvalued relative to silver, because at current prices, it takes 75 ounces of silver to buy 1 ounce of gold.  Historically, this ratio was 15 or 16.  Given the silver shortage, this ratio will hit 10:1 or 5:1, or even 1:1.  Thus, gold is perhaps 75 times more overvalued than silver.

Silver is overvalued relative to certain select silver stocks, perhaps by a factor of 3 or 10 or 20 to one. 

Thus, if you multiply all those numbers, 278 x 75 x 20,  You will see that bonds and currency are overvalued relative to select silver stocks by a factor of 416,666 to one. In other words, if silver stocks reach their true value, and paper currency disappears as it always does, then you might expect certain silver stocks to go up in relative value by a factor of 416,666 times more than they are worth today.  By that time, you should definitly sell the silver stocks, and buy gold.

Can silver stocks really appreciate so much? Is there historical evidence for such a crazy thing?  Yes. 

“CDE rose from penny stock status (.02 in 1967) to an NYSE-listed, $60 per share stock in 1980. In fact, the average share on the Spokane Stock Exchange rose in value nearly 16000% (yes, sixteen THOUSAND percent), as America could not get enough of silver and silver stocks.”

CDE rose by a factor of 3000, or 300,000%, and by 1980, the metals boom was stopped short, and paper money’s death was postponed.  If paper money dies a death that lasts a generation world-wide, then even greater gains should have been expected.

For this reason, a wise silver stock investor should NEVER sell silver stocks for paper cash.  A wise silver stock investor who looks for value would never sell a fairly valued silver stock for an overvalued silver stock that traded for hundreds of thousands of times more value than it should be.  Likewise, there is no excuse for a silver stock investor to have any cash or money market or bonds in his portfolio for any reasonable length of time, except for when selling one silver stock to raise the cash for another silver stock, or for when you need to raise the cash to buy silver, or a private placement in another silver stock.  

So, if you want some fairly liquid alternatives to cash, in case you don’t know what other silver stocks to buy at the time, here they are:
1.  Buy silver.  You can hold silver in an IRA.
2.  Buy CEF.  Central Fund of Canada, ticker symbol CEF.  It’s gold/silver bullion fund.  It has 50 oz. of silver for every 1 oz. of gold.  The fund is fairly liquid, you can buy it as easily as any other stock, and is a good cash substitute.  Unfortunately, given the current ratio, it is about 60% or more of the value is in gold.
3.  Buy a fairly large cap silver stock, with fairly large volume, that is still fairly cheap on the list.  SSRI is probably the best candidate, the next might be PAAS.  


The sheer stupidity of big money not recognizing the value of the world’s remaining silver is utterly shocking to the rational mind.  Clearly, bond holders are utterly deceived, and totally unaware of the situation.  All my readers should understand and know that bonds were originally invented to suck the capital and money (gold and silver) away from the people.  Bonds today are a paper promise to repay paper.  What a con game!  Are bond holders conservative and safe?  No, they are fools!  There is nothing safe about holding a paper promise to receive more paper when we have been experiencing hyperinflation for the past two and a half years!  

See my prior essay, “Inflation & Deflation During Hyperinflation”

And the fund investors who buy paper silver futures contracts instead of real silver are a very odd bunch of fools, for they should realize that nobody can deliver the 800+ million ounces of silver promised in the paper contracts and options that does not exist.  It’s like the paper longs are betting on the bank run happening, but they all are making sure they get at the end of the long line.  Instead, they could go front and center, where there is an open window available where you can go and get physical silver, and nobody is there.  Idiots!  If you know a bank run is going to happen, and you are actually willing to bet on it, then go and withdraw your money before it is too late!  Don’t bet on it happening, which, if it does happen, your contracts will be defaulted on!  Amazingly blind idiots.  Wake up!

See also my prior essay, “The Moral Failures of the Paper Longs”


How bullish am I on silver?  Here’s an interesting way to put it: “75 times infinity” dollars per ounce. 

I believe the dollar will eventually be destroyed, likely within my lifetime, hence the “infinity” part.  I believe the ratio of silver to gold may be equal during a spike, when the market realizes that above-ground refined silver is more rare than gold.  Thus, silver may outperform gold by a factor of 75 times better.  Currently, the ratio is 75 ounces of silver can buy one ounce of gold or 75:1. 

I may end up selling silver for gold, some at the 10:1 silver to gold ratio, some more at 5:1, and I would sell any silver remaining at a 1:1 ratio, that we may hit during a supply/demand crunch during a paper money collapse.

For a list of bullion dealers:
The Silver Stock Report

For a list of Brokers that handle Canadian issues and/or pink sheets:

To learn how to track the stocks on this list at yahoo: (NOT updated this week)

To learn All about Canadian law, 43-101, about reserves and resources:

This is a list of primary silver stocks.  

I count a company’s ounces of gold as 10 oz of silver. Why? Because I have a very strong positive bias in favor of silver over gold. 

Given my bias in favor of much, much higher silver prices, then, to me, the grades of silver are far less important than buying more oz. in the ground.  More oz. in the ground at a lower cost is the most important consideration for me.  

My method is simple. Cost per ounce in the ground. How much do you get (silver reserve totals), and how much does it cost (market cap)? The cost is the market cap divided by the silver reserve totals. Cheaper is better. Buy low, sell high.

Disclaimers, Warnings, and Advice: I have gathered the information below over the course of several months. I believe it is accurate to the best of my ability. I may have made mistakes. I probably did. I’m human. I have collected the information from public sources such as company web sites and public information found at to get the stock prices. This report in no way guarantees the accuracy of the information below, since the information may change at any time. The number of outstanding shares can change as a company engages in new share issues to raise more capital through private placements, or if outstanding warrants (and options) are exercised and converted into shares, or if shares are bought back. Shares can be consolidated, or split. The number of ounces of silver in the ground can also change, as these are often only estimates. The number can also change up or down, depending on drilling results.

This report is not investment advice.  This report contains information that may or may not be up to date, and may be inaccurate.  I urge you to contact the company and do your own research to verify the information contained in this report.

This report is not an offer to buy or sell any securities.  I am not a broker.  Only your broker can buy or sell securities for you.

I urge you to consult with your investment advisor to determine whether these kinds of investments are right for you.  

I also caution you to be aware of your investment advisor’s advice, they are sometimes paid to push things like mutual funds, bonds and other securities that may not be in your best interest to buy.  Some investment houses are short physical metal, and thus, they may attempt to strongly discourage you from buying precious metal or precious metals investments.  I believe that the propaganda machine in support of frauds such as bonds and the dollar is so strong, that they may even believe what they say when they give bad advice to avoid the safety and protection of precious metals.  It is most likely that they simply do not understand the precious metals market as well as you do.

All total estimates of “ounces in the ground” can vary widely. There are “proven and probable reserves” which are the highest category of certainty which is obtained through many drill holes, and then at the least accurate, there are “inferred resources” which are hardest to estimate. Additionally, every miner always has “more silver properties that need to be explored, which probably contain more silver”. For the purposes of this report, I have added all those numbers together. It is believed that all these “ounce in the ground” estimates can be profitably mined at $5-6 per ounce silver, or lower. Thus, I believe that when silver trades for $15/oz. or above, that all of these ounces can be mined at a substantial profit. 

I may be wrong. (I probably make mistakes in every article, and there have been updates and corrections made each week, especially as prices change.)

Mining is a risky business. You need to be willing to sustain a total loss of your investment for various unforeseen accidents. Silver stock companies can do stupid things to shareholders such as take on debt, or issue more stock at too low prices which reduces the percentage of the company you may own (dilution). Yet, they need to issue shares to raise capital for drilling, and then an even bigger dilution to build a working mine. They may sell YOUR silver too cheaply, or worse, hedge the price of YOUR silver just as it begins to go up if they lock in a price which then proves to be too low if the dollar is destroyed. Mining is a risky business as estimates of assets in the ground can change. There is political risk and environmental risk. They can’t franchise the business, are stuck in one location, are subject to government confiscation, or taxes, or union wage negotiations, and corporate looting.

Do your own research.  Be responsible for your own investment decisions.  Again, please, before investing in a mining company, call up the company, and speak either with the CEO or the Investor Relations contact person. 

So, at the very least, check the company web site, read the annual reports, check my numbers, check my math, and email the company. That’s what they are there for, to answer your questions, and to speak about the opportunity of the company. Don’t trust everything you read over the internet. I am a biased source. I own silver mining stocks. And I’m not a broker, nor an investment advisor. I’m just a private investor trying to make sense of this crazy world, and sharing my information and thoughts on silver companies. 

Surely, there are scammers in the mining industry in the past, and there will be scammers in the future.  Remember the fraud of Bre-X.  The new 43-101 compliance laws put in place after Bre-X will not prevent a “certified” geologist from lying if he feels lying will create a better payoff.  The Bible warns, “trust no man”, yet at the same time advises us to “cast our bread upon the waters”, and to not issue “false allegations” against others.  Physical gold and silver provide the “payment in full” as long as the coins or bars themselves are genuine and not fake. 

This report may be copied, and transmitted by other people, and may become outdated by the time it reaches you.

I can’t tell you how you should invest your money, of course. The reason is that I don’t know how convinced you are of the silver bull market, nor do I know how soon you will be needing the money back, so I don’t know how long you can wait to see results, nor do I know how much liquidity you need. Nor do I know the size of the money you have to invest. It is very hard to invest large quantities of money in a small market cap stock. 

That being said, my investment strategy seems to be working for me, so far. And so, here is how I have valued the following silver companies to make my own investment decisions. 

(Market cap is always converted to US dollars and denominated in US dollars because I divide by ounces of silver, which are also denominated in dollars)

(These first three companies, BHP, GMBXF.PK, and BVN  produce a lot of silver, but are way to expensive to buy for the silver exposure for your portfolio.)

BHP Billiton Ltd (BHP)
–‘produces 40 mil oz. silver annually from one mine’
Additional comments:  unfortunately, BHP has a 49 Billion market cap, so we can’t buy BHP for the “silver exposure”.  IE, $49 Billion / oh, say, 1000 million?????= $49/oz.

Dear BHP:  By all means, keep mining the silver if you want the silver exposure, and want to be in the silver business.  But don’t sell the silver.  Keep it.  Let the profits of your entire company accrue as an increasing physical supply of physical silver.  In fact, do as Buffett did, and buy more silver if you can.  It would be infinitely easier for you to buy silver from yourself than it would be to buy 40 million ounces of silver from the COMEX, which, today, might be impossible.  

Grupo Mexico SA de CV (GMBXF.PK)
“Grupo Mexico ranks as the world’s third largest copper producer, fourth largest producer of silver and fifth largest producer of zinc.”

Compania de Minas Buenaventura SA (BVN)
Minas Buenaventura 
– Peru´s largest publicly traded precious metals company 
–produces over 10Moz of silver per year
–looks way too expensive for the silver alone: 3.6 Billion market cap.

HL (208) 769-4100
109 mil shares @ $7.42 share 
$918 million Market Cap (MC)
near zero debt, cash: $125 mil (Nov. 2003)
(est. 2003 production 9 mil oz. silver) 
(the La Camorra gold mine, 412,000 oz gold.) … (x 350/5 = 28 mil silver equivalent oz.)
San Sebastian silver mine, (proven & probably reserves) 8.7 mil (produced 3 mil)
the Greens Creek silver mine (proven & probably reserves) 31 mil (produced 3 mil)
the Lucky Friday mine (proven & probably reserves) 14 mil. (produced 2 mil)
Total silver = 53.7 million oz.
Plus 412,000 oz. gold x 10 = 4.1 mil oz silver equiv.
Total silver equiv. reserves = 57.8 mil oz.
(Since my method values silver in the ground as a key asset, I should also value the cash as a “silver asset” which will be “marked to market” if silver goes up, and cash goes down.  If HL is smart, they should be able to turn the cash into increased “silver exposure” either through buying silver properties, silver equities, or physical silver.)
($125 million cash /5.46/oz = 22.9 mil “silver equiv” oz.)
23 + 53.7 = 77
$918 mil MC  / 77 mil “oz.” = $11.92/oz.
You get “approx” .46 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: HL has more oz. than listed in the “proven & probable” category used in this calculation. Vein mining makes reserve calculations difficult, and HL has rarely had more than about a 3-4 year picture of reserves ahead of them in 100 years of production.   

I decided to count their papar cash as if it could be silver, but it still does not help boost their valuation much.  They are still the most expensive company on the list.  But if HL bought 22 mil oz. of physical silver, they might break the back of the silver market, and significantly boost their own profitability. 

Another way to check the value of HL is too look at profit, since they are active miners. They mine 9 million ounces of silver a year. What’s the profit on that today? Very little.  I think they had a loss in the 3rd quarter.  Total “cash costs” are $3.68/oz. (It’s that low because that figure includes gold credits!) Profit at $5.46/oz. is $1.78/oz x 9 mil oz. annual production = $16 million annual profit. That gives a PE of 57. That’s a very high P/E, which means HL is very expensive. 

I wrote an article comparing HL to CZN:

Silver Price Expectations of Silver Stock Investors – 30 October 2003

Also, why does HL hold $125 million dollars worth of cash at the beginning of a bull market in silver?  It makes no sense to me.  Cash is trash in inflation.  They should be buying physical silver, or, use that cash to buy other silver resources in the ground, like the undervalued silver stocks. 

OK, here’s another way to get a “guesstimate” of HL’s reserves.  I will assume they have enough silver to last another 20 years of mining.  That’s a fair enough time for a mine plan I suppose.  I suppose they could run out of silver sooner, or later.  They produce 9 mil oz. in a year.  9 mil oz. x 20 years = 180 mil oz.

$918 mil MC / 180 mil oz. = $5.1/oz.  HL is still expensive, no matter how I run the numbers.  

And in 3 months, nobody has been able to rationally justify this high valuation to me, nobody from the company, and not a single email from any investor.  I believe that this stock trades on market perception, reputation, and momentum.  As for me, I’m not buying such intangibles. I’m buying silver in the ground, real assets, or exploration potential.

CDE (208) 769-8155 or (800) 624-2824
210 mil shares (Issued 32 mil new shares late Oct. 2003)
@ share price $5.41
$1136 mil MC
cash $38 mil (I think this is outdated cash figure)
San Bartolome (Bolivia) reserves 146 mil silver
Silver Valley Silver reserves 32 mil silver
Rochester reserves 43 mil silver
Cerro Bayo reserves 3.7 mil silver
Total: 224.7 mil silver
(to Produce 14.6 mil oz. silver in 2003)
$1136 mil MC / 224.7 mil oz = $5.05/oz.
You get “approx” 1.1 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: CDE continued to lose money in third quarter 2003, a loss of 10 cents/share, and they realized low prices for silver sales, $4.77.  I believe they have hedged their gold production at low prices. 

Again, their listing of ounces is in the “reserves” category (more certain) not the “resources” category, which is less certain.  They probably have “resources” but like HL and Industrias Penoles, they give no estimates.

CDE and HL moved up in price significantly for the 3rd week in a row.  Most likely due to new investors who know very little about how overpriced these two NYSE listed stocks really are, but all they may feel is that “silver stocks will outperform silver”.  But I don’t think there is any reason for CDE and HL to continue to outperform silver from this point at today’s stock prices.  The johnny-come-latelies who bought these stocks last week will get some benefit, but not as much as if they had done their homework, or bought physical silver, in my opinion.

Another idea I’ve had is that if CDE and HL are the most expensive silver stocks, and if they are flying, then that means that there is serious new money coming into the silver market sector.  This is very bullish overall for the rest of the shares in my opinion.  New money entering the silver sector is a sign we need to see if silver is going to have monetary demand for silver, which will really make the silver sector begin to run.

Now, if we can only get CDE and HL investors to get those two companies to buy physical silver, we will really see the beginning of a bull run in silver.  (In other words, the silver bull has barely even started compared to where we are headed, in my opinion.)

397.5 mil shares outstanding (2002 annual unchanged since 2001)
@ $3.00/share
$1,192 mil MC
419 proven and probable reserves of silver (from 2002 annual report on website)
$1,192 mil MC / 419 oz. silver = $2.84/oz.
You get “approx” 1.9 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Industrias Penoles is the world’s top producer of refined silver.  They actually derrive more revenue from silver than any other source.  But they lost money in 2002.  

78.5 million oz. silver refined by the metals division in 2002, and 1 mil oz. gold.
They probably refine almost all the silver that comes out of Mexico.
They probably produce about 34 mil oz. of silver from their mines annually, and they have expansion plans.  

I think Industrias Penoles should stop mining silver if they are doing it at a loss.  Basic econ 101, right?  Don’t engage in uneconomical activity.  Perhaps they have a small gain this year with improved prices?  Regardless, they should realize that silver in the ground is an asset, and also that silver in the hand is an asset.  If they do make a profit, I hope they decide to keep the form of their profits in silver, or at least, pay out a dividend in silver.

I’ve heard this stock is tightly held, most is family owned.  

Their oz. numbers are “proven & probable reserves”, which is much more certain than most of the others which are mostly “inferred and indicated resources.”  They undoubtedly have “inferred and indicated resources” in addition to the “proven & probable reserves,” I just could not find any info on that at the website or in the annual report.

GRS / GAM.TO (902) 468-0614
fully diluted 52 mil shares
@ share price $5.15
$267 mil MC
“With the drilling of over 179 holes totalling over 33,700-metres, the resource calculation contains 761,000 gold ounces and 38.2-million silver ounces in the measured and indicated categories and a further 925,000 gold ounces and approximately 45-million silver ounces in the inferred category.”
Total gold: 1.7 mil oz. x 10 = 17 mil silver equiv.
Total silver: 83 mil oz. 
Total silver equiv = 100 mil oz.
$267 mil MC / 100 mil oz. = $2.67/oz.
You get “approx” 2.03 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  At current prices of a 70:1 silver:gold ratio, about 58% of the company is in gold, 41% silver.  Gold equiv oz. is about 3 mil oz. total.  Cash cost is $85/oz.  Life of mine is 7 years.  At $385 gold, should produce $900 mil oz. profit over the life of the mine. Not bad for the current $182 MIL MC… even though the “silver in the ground” cost is currently high.  Therefore, my valuation method undercounts the gold componant, and undercounts current producers.  But that is intended, however, because I believe silver has over 7 times the potential as gold.  My comparison method does not say that the companies that cost more can’t bring a reasonable profit to the shareholder.  My comparison method does tend to say that the profits will be higher for the silver companies that cost less. 

There’s just not a lot of silver exposure here for the price.  But with the high grades, and “gold bonus” the risk is lower, and the profits should be here for those who want more safety in a stock pick.

And they are “rapidly expanding” resources & reserves with round-the-clock drilling of 4 rigs.

ECU.V (819) 797-1210
77.1 mil shares outstanding
fully diluted shares = 103.3 million (6 January 2003)
@ Share price .27 CAN (x .77 US/CAN) = .21
$21.5 mil MC
See the url above for the numbers from the company’s website, which are:
Proven & Probable & Possible: 7.6 mil oz silver, 93,000 gold. = 8.5 million “silver equiv” using my method of counting gold as 10:1
“Potential” total: 21.2 mil oz silver, 221 mil oz. gold.
According to my valuation method, that’s 2.2 mil oz. of “silver equiv” for the gold, plus the 21.2 mil oz. silver, for a total of 23.4 mil oz.
$21.5 mil MC / 8.5 mil oz. silver equiv. = $2.52/oz.
$21.5 mil MC / 23.4 mil oz. silver equiv. = $.91/oz. –exploration potential
You get “approx” 2.16 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential: 5.94

See also regarding ECU’s exploration potential:

Additional comments: Last week, I updated ECU’s mineral resources by using figures from the company website.  I concluded by saying, “There may be bullish things about ECU.V… that I just don’t know about.”  Sure enough, on Thursday of last week, bullish news came out on ECU, as follows:  They recovered title to properties that were in dispute.  See:

MAI.V / MNEAF.OB (604) 689-7017
37 mil shares outstanding on February 5, 2003
finncing to be closing shortly, to raise $6.6 mil CAN.
59 mil shares outstanding
73 mil fully diluted as of Nov. 2003
@ share $.59 CAN x .77 = $.45 US
$33 mil MC
To raise $6.6 mil in recent financing.
owns 49% of the resource: “55 mil silver equiv. oz. resource” back in 2001.  AT 60:1 silver:gold when gold was about $300/oz., about half/half silver and gold.  
Estimated:  27.5 mil oz silver
Estimated:  27.5 mil oz. “silver equiv” of gold.
/ 6 = 4.58 mil oz. silver equiv at 10:1 ratio.
Total: 27.5 + 4.6 = 32 mil oz. silver equiv. (x .49 = 15 mil oz.)
They will be exploring for more.
2.2 km stretch, open another 2.7, plus 3 other vein systems.  significant high grade silver exploration potential.  7000 meters of diamond drilling.  Plus a copper project, billion ton ore deposit.
$33 mil MC / 15 mil = $2.21/oz.
You get “approx” 2.46 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  About half is gold value, half was silver value at 60:1.  

SIL (303) 839-5060 
36.6 mil shares 
@ $18.07/share
$661 mil MC
cash on hand: $40 million (Nov. 2003)
San Cristobal (Bolivia) (proven & probably reserves) 454 mil silver
(forecast capital costs for construction to total approximately $435 million)
(Produced zero silver in 2002)
7.8 billion pounds of zinc, and 2.9 billion pounds of lead
$661 mil MC / 454 mil oz = $1.45/oz.
You get “approx” 3.74 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: Apex silver has come down significantly from a high of $18/share in early August, and primarily has institutional investors.  

A part of the high grade story is that this one has a lot of zinc. That’s an added bonus that is not factored in to my method of valuation. Several writers have been saying zinc prices will be heading up soon, so that’s another bonus. Plenty of zinc is especially good if zinc is moving up in price.  And, they are not mining now, but are waiting for higher silver prices. That’s also a plus. The management also seems to understand that silver will move upwards a lot. Another plus. Finally, George Soros, Billionaire, owns a bit of this one, just under 10% I read recently. That’s a nother plus, in general, for the silver market if Billionaires are paying attention to it.  There are several other zinc / silver plays on this list that investors might also consider: CZN.TO, EXR.V, MMGG.OB (I own all three of these.)

KBR.V (604) 669-2251
28 mil shares fully diluted
@ share price $2.30 x .77 = US $1.77
$49 mil MC 
30 mil oz. silver resources indicated and inferred
540,000 oz. gold x 10 = 5.4 mil “silver equiv.”
$49 mil MC  / 35.4 mil oz. = $1.40/oz.
You get “approx” 3.89 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  KBR.V moved up very strong two weeks in a row now, up from $1.70 last week. KBR.V moved up very strong from the week before up from $1.10 CAN, on no news.  But they were at the SF gold show, and they were on the report from the SF gold show. 

* CFTN.PK  (I own shares) 801-756-1414   (303) 642-0659 Ken Friedman
45 mil shares fully diluted  (Oct. 2003)
@ $1.48/share US
$66.6 mil MC  –source of 100 mil oz. resources est.
“A previous geologist has talked about a possible resource of 1 billion oz. of silver, and 5 million oz. of gold.”
100 mil oz. silver
+500,000 oz. gold x 10 = 5 mil oz. silver equiv.
= 105 mil oz. silver.
up to 1000 mil oz. silver “exploration potential”.
Clifton sold up to 50% of the project to Dumont Nickel for $5 million to be paid over time. 
50% x 105 = 52.5 million oz.
50% x 1000 = 500 mil oz. “exploration potential”
$66.6 mil MC / 52.5 mil oz. = $1.26/oz.
You get “approx” 4.3 ounces in the ground for 1 oz. silver.
Exploration Potential: 43

Additional comments:  Note the “exploration potential”. This is about 10 times cheaper, like 10 cents/oz, or you “might” get 51 oz. in the ground for 1 oz. silver.

For more info on what’s going on with Clifton, see, JV partner.

Clifton has 25% ownership of a biotech firm that makes a colloidal silver.  They recently released a press release that downplayed a letter they received from a person in US Homeland security that “approved” their product.  

Clifton has a patent on a “super” colloidal silver solution made with 10,000 volts that adds oxygen that gives it more powerful antibacterial properties, and is safer since it uses less silver, which would prevent “blue skin” argyria.  Normal colloidal silver that you can make at home with 30 volts works to kill bacteria by disrupting the oxygen metabolism of the cell wall, killing bacteria with oxygen.  The market for safe antibiotics is in the multi Billions of dollars.

I own CFTN.PK.  

* CZN.TO / CZICF.PK –(I own shares) 1-866-688-2001
45.1 mil shares (fully diluted) as of Sept., 2003 
65 mil shares fully diluted when the Oct 16th Private placement is filled.
@ Share Price $1.56 CAN x .77 dollar/CAN = $1.20 US
$78 mil MC
$7 million cash, CAN, no debt.
not mining ($20 mil needed to finish & start the mine) ($100 mil worth of mining infrastructure in place!)
~70 mil oz. (IN ZONE 3 only!! of 12 zones! This company seems to be greatly under-reporting their silver reserves. Their 18 year mine plan consists of zone 3 only, but there are 12 mineralized zones on the property.)  Really, perhaps well over 100 mil oz. silver.
$78 mil MC / 70 mil oz. = $1.11/oz.  
You get “approx” 4.89 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  CZN likely has much more silver in the ground, and has good profit potential.  I wrote an article on Canadian Zinc on Oct. 23 that appeared here:  I concluded with a share price target of between US $2.04/share and US $4.42/share.

I wrote another article comparing HL to CZN here: 
Silver Price Expectations of Silver Stock Investors

I would like the company to privide an estimate of the silver on the rest of their properties, but their mine plan consisted only of zone 3 at the moment.  The rest must remain “exploration potential” for now.

To get the mine up and running, they might be able to pay back such debt within 2 years, but I would hope they would avoid debt, and raise the capital as the share price begins to approach US $2/share or more, and do a final public offering between US $2-4/share.

I note several very, very positive things about this company. 

1. This was the mining operation set up by the Hunt brothers, the major silver investors in the silver spike to $50/oz. in 1980 who were destroyed by their own debts and margin calls as a result of the COMEX rule changes and silver short sale manipulation. The Hunts spent $50 million building infrastructure to get the mine running. They were 90% complete when bankruptcy hit. The value of those buildings is now $100 million, and the mine only needs about $20 million (CAN) ($15 mil US) to get the mine up and running. That’s much cheaper than other cost estimates of other operations.
2. The 70 million oz. of silver estimate is for zone 3 only. But there are 12 zones on the property. The zone 3 estimate is for a 10 year mine plan that involves mining zone 3 at current metals prices. The company can mine, at a profit, at current silver and zinc prices.
3. High Grade ores:  
12% zinc/ton; = 240 lbs. zinc/ton x 42 cents/lb. = $101/ton for the zinc.
10.1% lead/ton = 202 lbs. lead/ton x 27 cents/lb. = $55/ton for the lead.
6 oz. silver/ton x $5.11/oz. = $31/ton for the silver.
0.4% copper/ton = 8 lbs. copper/ton x 90 cents/lb. = $7/ton for the copper.
Total: $194/ton.
4.  My method of valuation:  If I counted the zinc as silver, then the price of this company would be something like four times cheaper than it is based on my “valuation method”.  If I counted the lead as silver, then this company would be about 4-5 times cheaper. 
5.  Zinc and base metals prices are moving up strong.  Check for updates.   

CZN announced today another private placement of $6 million at $1 per share. See

CZN will have to get shareholder approval for this one, in an emergency meeting on Dec. 30th, since they maxed out the allowable share dilution from the previous private placement, which was a dilution of a whopping 44%.  I recommend that shareholders REJECT this private placement at $1 per share for several reasons.  First, the share price continues to go up, and as I have written in several articles based on reports on the company website, the share price does not yet reflect the true value of this company.  Besides, this private placement is way below the current share price and should be at least 80% of the previous day’s close, according to law, unless shareholders approve.  This one is not at least 80%!  $1.00 is only 64% of the previous day’s close of $1.56.  Why so low guys?  Come on here! The price of this PP should be at least 80% of $1.56, which is $1.25!   Further, if the company is patient, and waits until time goes by until they are allowed to do another private placement, the company should be able to get well more than $1 per unit in a financing.  

Now, there is a reason that regulations prevent companies from engaging in excess dilution.  The reason is that it is irresponsilble and against the best interests of existing shareholders.  Dilution should be done more slowly, only 25% new shares per year, accoring to the regulations, for the reason that this helps to protect the interests of existing shareholders.  CZN has already issued 44% new shares, well over the 25% limit in the law (because shareholders approved in the last meeting.).  CZN.TO should be able to have no trobule at all raising money in a new private placement next year, perhaps at $2 per share or more, depending on the price of silver and zinc.  In fact, they may end up doing a private placement at $3 or $4 per share, who knows?  But the point is, the higher the share price of the next private placement, the better it will be for existing shareholders, and less dilution, which means less reduction in the percentage of the company that you own.  And in the meantime, if these bigger money guys want to buy CZN so badly, let them buy the share on the open market, and push the price up, like happened when the rest of us had to buy!  

This is exactly the kind of senseless and excessive dilution that is not in the best interests of this company.  First of all, management should not have done the earlier private placement at 50 cents, they should have done that one at $1 or more!  And furthermore, they should not have let the first one go out for a full $7 million, they should have kept it at $2 million.  Let the price go up further, and say no to this dilution at $1.  We don’t need their money now, not at this share price, and we should be patient for a higher share price.  

Besides, the big money that wants to invest in CZN right now should look elsewhere for investment projects, such as MMGG.OB instead, another silver/zinc project that appears below in the explorer category on this list.

I own shares of CZN.TO  

FSR.TO (604) 602-9973 or (888) 377-6676
37 mil shares 
@ share price $1.50 (CAN) x .77 dollar/CAN = $1.15 US
$42 mil MC
From the Company’s main page at their url:
“As at December 31, 2001, First Silver’s mineable reserves were 12 million ounces of silver and inferred resources totaled 30 million ounces of silver. The mine is developing a 1000 plus meter exploration drift to upgrade currently identified inferred resources to mineable ore reserves and to discover new reserves.”
12 + 30 = 42 mil oz.
$42 mil MC / 42 mil oz. = $1.01/oz.
You get “approx” 5.4 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: This is a high grade, producing miner.  The high grades are a plus.   They are also actively exploring, another plus. I don’t know what their profits are, if any, nor do I know what the fully diluted share structure is.

TM.V TUMIF.OB (TUY Frankfurt Exchange) Nick Nicolaas IR (604) 657 4058
16.3 fully dilutted shares (Oct. 21, 2003)
@ share price 1.75 CAN (x .77) = $1.34 US
$22 mil MC
20 mil oz resource up to 50 million oz. silver potential but needs to be explored and drilled. 
500,000 gold resource x 10 = 5 mil oz. silver equiv. 
Debt free, 2 projects in Mexico.
Raised $2.7 million Nov. 14, 2003
$22 mil MC / 25 mil oz. = .87  ***I’m using this number***
$22 mil MC / 50 mil oz. = .44  (exploration potential)
You get “approx” 6.3 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential: 12.4 (plus more after bonanza silver discovery late November.)

Additional comments:  Tumi roared up 29% on Nov. 20, followed by a 27% gain on Friday Nov. 21, after the company announced a bonanza grade silver discovery after drilling.  This should significantly increase the numbers for their “exploration potential”, but no word yet on the increase.  It takes time for the geologists to estimate all of that, but investors went crazy over it immediately.  

Tumi is focused on becoming a “premiere junior silver explorer.”  It’s good to see the focus is in the right metal.  Doing active drilling to prove up their projects and increase “resources”.  Nick Nicolaas really understands the silver story, beliving silver has much greater appreciation potential than gold. 

Look at: Tinka TK.V (tumi’s sister company)
A pretty big gold/copper property in Peru (Tumi owns 30% of it)…  
That could mean significantly increased assets for Tumi.

PAAS (604) 684 -1175
52 mil shares PAAS recently borrowed $100 million in a convertable debenture deal at about $9/share.  This potentially increases the number of shares outstanding significantly.
@ $13.35 / share
$702 mil MC
10 silver properties (3 in production)
produced 7 mil oz. silver in 2001:
February 2003 presentation reported total reserves including peru stockpiles of 874.3 million ounces
earnings -$.77/share?!
$702 mil MC / 874.3 mil oz. = $.80/oz.
You get “approx” 6.8 ounces in the ground for 1 oz. silver’s worth of stock.

Additional Comments: PAAS is one of the few silver producers on this list. Thus, they are a “silver miner” as their investor relations person will painstakingly point out. The other companies who do not mine silver, but merely own silver properties and drill them, are not “silver miners,” nor are they “silver mining companies”. They are “silver properties,” or “silver opportunities,” or “silver speculations,” I guess. Ok, but that still does not justify selling silver at firesale prices, in my book.

PAAS recently went into debt in order to ramp up production. I am strongly biased against debt. But it’s a convertible debenture, so the debt can be converted into stock. They know and believe higher silver prices are coming, which is great, and their strategy is to be in solid production mode when the higher price hits. In the meantime, though, the extra production will delay the inevitable silver boom.

(formerly western copper) Jay Oness Toll Free: 1-888-456-1112
34.3 mil shares  (Oct. 2003)
@ share price $5.27 US
$180 mil MC 
(not actively mining)
From the “SNC Lavalin Resource Calculation” March, 2003.
Indicated 158.8 mil oz. silver
Inferred   54.6 mil oz. silver
Total 213.4 oz. silver.
Total 1.94 oz. gold x 10 (at 10:1) = 19.4 silver equiv.
Got $3 mil CAN cash, no debt.  
The capital cost to get the mine going is estimated to be US $148 million
Penasquito silver/gold.  213 mil oz silver.  just over 2 mil oz. gold. from Chile/Colrado zone.  
Brechia zone will double the numbers, and infilling inferred to indicated: probably in Jan will have 500 mil oz. silver, 5 mil oz gold.
Exploration potential: 500 mil oz. silver, 5 mil oz. gold, from
Two other zones that could each duplicate the success of each of the other two. So up to a Billion… oz. of silver as “exploration potential”!
Feasibility: 2006-7 production timeline.
$180 mil MC   / 233 oz. = $.77/oz.
$180 mil MC   / 1000 oz. = $.18/oz. –exploration potential 
You get “approx” 7 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration Potential = 30

Additional comments:  Note the capital cost to get the mining started: $148 million dollars.   
A friendly email came in and said that WTZ also has the following other metal resources:
3.73 billion pounds of zinc
673 million pounds of copper
1.3 billion pounds of lead

SSRI (604) 689-3856 or (888) 338-0046
40 mil shares (Oct. 2003)
@ share price $11.20
$448 mil MC
debt free, cash: $10 mil
not mining or producing
15 silver properties
measured and indicated resources totaling 300.4 million ounces of silver 
plus inferred resources totaling 366 million ounces of silver = 666 mil oz. 
2.2 mil oz. gold. Silver equiv = 22 mil oz. silver. (22+666=688 mil oz.) 
$448 mil MC / 688 mil oz. = $.65/oz.
You get “approx” 8.38 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  SSRI really is the “silver standard”.  SSRI has the largest market cap this far down the list, which makes it a more attractive target for people with larger amounts of money to invest. 

SSRI continues to add to reserves, either through exploring, or through acquisitions.  This company seems to really understand the silver story, and helped to educate me as an investor.  

I attended a two hour presentation after the Gold show in SF in late November.  For the most part, their properties are very well drilled, and they have a fairly solid idea on how much silver oz. in the ground they have.  They started their plan to acquire silver properties and become a “silver company” in about 1993, which explains why they have such a large market cap, and so many good properties with so many ounces of silver.  I encouraged them to acquire silver properties and get ounces in the ground at 10-15 or even 20 cents/oz.  They indicated that they felt this would ‘dilute’ the value of the silver properties they acquired for 5 cents/oz in the ground.    I counted by saying new acquisitions would add value for existing shareholders who hold or acquire the share price at higher prices.  They said they would consider this idea further.  

Some investors like SSRI because of the diversification –SSRI owns many silver psoperties.  I say you can get a similar kind of diversification by owning stock in many silver companies.

18.7 mil shares outstanding
@ share price $2.40 CAN x .77 = $1.84 US
$35 mil MC
inferred resource: 45 mil oz. silver + 1 mil oz gold.
1 mil oz. gold = + 10 mil oz. silver equiv
“The estimate does not address significant additional mineralized structures known to be present on the property, or the potential for large strike extensions of known high-grade zones.”
$35 mil MC / 55 mil oz. = $.63/oz.
You get “approx” 8.7 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Gammon Lake is a large shareholder, 50%.  The quote above comes from Gammon’s website.  

DNI.V  (416) 595-1195
56.4 mil shares outstanding 
@ share price $.63 share x .77 = $.48
$27 mil MC
*** Dumont still needs to raise and pay several million to clifton for 50% of the project.
$27 mil MC / 52.5 million oz. = $.52/oz.
You get “approx” 10.5 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Clifton’s JV partner, doing active drilling work right now.  Dumont moved up strong in price last week.  They announced the acquisition of properties.

ASM.V / ASGMF.PK 604 682-3701 — David Wolfin
10.9 mil shares fully diluted, Nov. 2003 (with the 4 mil new shares from PP)
(proposed PP in late Oct 2 mil units at $1.27 (unit = 1 share + 1 warrant at 1.58)
@ share price $2.56 CAN x .77 = $1.97 US
$21.5 mil MC
from: –in 1997
“How Much Silver Does Avino Have?”
“Operations at Avino’s silver mine in Mexico are both open-pit and underground. I examined the reserves and interpolated the tonnage into silver ounces as follows: 28-million ounces proven; 50-million ounces probable and 27 million ounces possible.” (Not all are 43101 compliant reserves & resources.–that is an old, third party report.)
–focus is on being silver company. A plus.
They actually have over five silver properties/projects.  I’m only have numbers to count for one, the “Avino mine”.  
= 28 + 50 + 27 = 105
Avino owns 49% of that, or 51.5 mil oz.  
-“not considered reserves under the new Canadian National Policy 43-101”
$21.5 mil MC / 51.5 mil oz. = $.41/oz.
You get “approx” 13 ounces in the ground for 1 oz. silver’s worth of stock.

Additional notes: There are 4 additional silver properties that I don’t have numbers for.  Consider this a “silver bonus”!!!

Mexican mining law once stated that a controlling interest had to be owned by Mexicans, which explains why they only have a 49% interest.  That they don’t have a controlling interest is a minus. This law has changed. The mine was operational until the mine went into temporary closure in November 2001. So there is in place an existing mine, with working infrastructure, which is a bonus.  There is a need for drilling in order to test the potential that was stated in the feasibility study.

* SVL.V / STVZF.PK (I own shares) (604) 691-1730 
15.18 mil shares outstanding oct 31, 2003
22.2 fully diluted oct 31, 2003
(just about closed a PP for a million units, 2 mil more)
24.2 fully diluted Nov. 21, 2003
(pub float: 8.93 mil, the rest is owned by insiders)
@ share price $1.58 CAN x (.77 US/CAN) = $1.22 US
$29 mil MC
Indicated resources of silver 30 mil oz. (SOZ.)
Projects in Honduras.  BUT…
*** discovery adds silver*** (perhaps 40-100 mil oz.) see below
new silver totals are projected to be: 70 – 130 mil oz.
$29 mil MC / 70 = $.42/oz.  
$29 mil MC / 130 = $.22/oz.  
You get “approx” 13 ounces in the ground for 1 oz. silver’s worth of stock.
(Exploration potential = 24 oz.)

Additional comments:  These additional ounces, beyoned the 30 mil oz. are “exploration potential”, and are not 43-101 compliant. 

Plus, their reserves are potentially “open pitable” which reduces costs.  They will be acquiring more silver properties with the money raised in the late November 2003 private placement, which I think is an outstanding way to spend the money.

MMM.TO 1-888-288-8288
Fully Diluted Issued & Outstanding 23,133,623
@ $1.85 x .77 = $1.42
$33 mil MC
Located in China
gold and silver.  Don’t yet know how much of either, but a man who emailed me said 80 mil oz. silver????  I was not able to confirm that at the website.
$33 mil MC / 80 mil = $.41/oz.
You get “approx” 13.3 ounces in the ground for 1 oz. silver’s worth of stock. –I still need to confirm this.

ADB.V 604 628 5642 — Curt Huber– Business Development  
26.2 mil shares fully diluted (as of Oct 7th., 2003)
+ up to 5.2 mil shares in private placement of Oct 17, 2003
31.4 mil shares to possibly be fully dilluted. 
@ share price $1.45 CAN x .77 = $1.12 US
$35 mil MC
They have $6 million cash.
–owns an option to earn 70% interest in “Miera San Jorge’s Monte del Favor property in Mexico”
“An historical resource estimate based on underground sampling at Monte Del Favor is reported at 17 million tonnes grading 0.85 g/t gold and 224 g/t silver for a contained 123 million ounces of silver and 460,000 ounces of gold.” “While this resource estimate is not fully 43-101 compliant, the Company considers that it provides a conceptual indication of the potential of the property.”
460,000 x 10 = 4.6 mil “silver equiv”.
127.6 mil oz. x 70% interest = 89.3 mil oz.
$35 mil MC /  89.3 mil oz. = $.39/oz.
You get “approx” 13.9 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Prior grades hit 2-5 kilos silver/ ton. (2000-5000g/ton. 70-176 oz. ton)  Very high grades.  The project was never properly drilled with modern methods.

Admiral Bay acquired this option to own a 70% interest in this silver property in June, 2003, and the acquisition did not impact their stock price at that time at all.  Previously, they were a gas company, and they still have this other gas project, which may be more than half the intrinsic value of the company according to Curt Huber, who understands the silver story as expressed by Ted Butler and David Morgan.   

My valuation method, obviously, does not give any value for their gas project, which therefore needs to be factored in as a significant “bonus”.  The company will probably split up the two projects into two companies, so existing shareholders will have shares of each, just as Expatriate spun off their gold projects.

They are actively digging now, building a road and uncovering mineralization areas, and tracing surface veins. They will be drilling before the end of October, spending $500,000 before the end of 2003.  They will be releasing drill results soon.

* SRLM.PK (I own shares) Ray DeMotte 208/676-0599
9 mil shares  
@ share price $8.12
$73 mil MC
Cash on hand: $1.1 million (an increase, reflecting the increased number of shares from 7 to 9 million) 
~185 mil oz. reserves + resource, Sunshine alone
Quote from:
“The prior operator last estimated the mine reserves at 26.75 million ounces of silver, 10.36 million pounds of copper and 7.05 million pounds of lead (or approximately 28.85 million ounces of silver-equivalent), as well as an additional resource of 159.66 million ounces of silver. “
~100 mil oz. other properties: the 10 sq. miles around the 1/2 sq mile of the Sunshine (rough guess–needs to be explored)  even though–these extra 100 mil oz. are in the “explorer” category.  They need to be drilled and found, although I’ve heard of estimates as high as 400 mil oz. total for SRLM.PK
$73 mil MC / 185 mil oz. = $.39/oz. 
$73 mil MC / 400 mil oz. = $.18/oz.  (exploration potential)
You get “approx” 14 ounces in the ground for 1 oz. silver’s worth of stock.
(Exploration potential is 30. )

Additional comments:  Ray DeMotte really, really understands the silver story, and has been aggressively acquiring silver properties.   Sterling continues to consolidate its land position around the Sunshine mine.  

Sterling Mining acquired the Sunshine mine. Sunshine was one of the big three: Hecla, Couer, & Sunshine. Sunshine went bankrupt. Sterling got the property a few months ago cheap, because they were quick & willing to pay cash. Other buyers wanted to do a full study before making an offer. This company’s share price went ballistic as a result. But the company is still way undervalued. Just do the math, people. I own a substantial share of SRLM.PK There were a few great articles written lately for SRLM. See the company web site, above. The best factors, I feel, are as follows:
1. The Sunshine mine is an existing mine that was mining at a profit. The company went bankrupt, not the mine. So there will be no great capital costs for start up, only minimal costs. 
2. The Sunshine sits on 1/2 sq. mile, and was never fully explored. Sterling Mining owns 10 square miles of property surrounding the Sunshine, right in the heart of silver country, the location of CDE and HL, the other two big companies at the top of this list. 
3. The management of Sunshine understands the silver story. They are on a mission to acquire distressed silver properties at today’s cheap prices. 

I own shares of SRLM.PK

(604) 684-6365  Erick Bertsch 
43.8 mil shares fully diluted (At Aug 31, 2003)
(plus a pp announced on Oct 31 of 15 mil units of 1 share @ .38 1 warrant @ .5 which is 30 mil new shares, to raise $5.7 million)
73.8 mil shares fully diluted as of Oct 31, 2003
@ share price $.70 CAN x .77 = $.54 US
$40 mil MC
Exploration and development in Mexico.
See also (Hunter-Dickinson) 
On 4 sulphide deposits out of 16, 29 mil ton grading 89 grams silver/t and 1.57 g gold/t.
Conversion: 89 grams x .0353 oz/gram = 3.14 oz.
RE: those 29 mil tons, they “anticipate increasing resources to 50 mil tonne range…”
3.14 oz. x 29 mil tons = 91 mil oz. silver
1.6 mil oz. gold x 10 = 16 mil oz “silver equiv”.
Total: 107 mil oz. silver equiv. 
(Exploration potential = x 1.7 = 181)
$40 mil MC / 107 mil oz. silver equiv.  = $.37/oz.
$40 mil MC / 181 mil oz. silver equiv.  = $.22/oz. –exploration potential
You get “approx” 14.7 ounces in the ground for 1 oz. silver’s worth of stock.
Exploration potential = 25

Additional comments:  
Private placement news link:

Nothing done or drilled on the property since 1999.  Why not?  Because of low zinc prices: 46% of the price of the metals was in the zinc before prices crashed…  (This one reminds me of Canadian Zinc.  They think they are a zinc company.)  The largest componant today is gold, which was surprising to Eric, the IR guy I spoke with.  About 1/3 is in silver now.

At today’s low metals prices:  
2% x 2000 lb = 40 lbs zinc x $.42/lb =  $16.8 for the zinc  (.37 to .50 lb zinc.)
3.14 oz. x $5.15 = $16 for the silver.
.055421 oz. x $385/oz. = $21 for the gold
(Assuming 100% metals recovery–which is not likely to be the case.  It may range from 60% to a higher percentage, depending on extraction methods used and the particular mineral targeted, which constantly change with technology advancements, and price changes in the metals.  By the time a mine like this gets running, perhaps in 5 years or so, things may change to allow even greater metal recovery.)

Speaking with FAN.TO guys, they think reserves of ore could be 50 mil tonnes OR MORE, but that they really don’t know, and want to issue conservative estimates.

no website
Phone: Magnus 1 (604) 261-6040
6.924 million shares out (fully diluted)
@ .55/share x .77 = .42
$2.9 mil MC
no debt
HDA’s proven and probable reserves stand at 161,000 tons of
ore grading an average 25.6 ounces per ton silver, and 10 percent combined
lead/zinc — 4.12 mil oz silver, not including the zinc & lead.
According to Magnus, the indicated and inferred reserves total about 180,000
tons at about the same grading — in other words, a further 4 million ounces of
~8 mil oz. silver
$2.9 mil MC / 8 mil oz. silver = .36/oz.
You get “approx” 15 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  There is a significant lead/zinc bonus.  “The property could be put into production at a capital cost of CAN $3.5 million — with payback of capital (when equity financed) within two years.” 

* EXR.V / EXPTF.PK (I own shares) 1-877-682-5474 Dr. Harlan D. Meade, President and CEO
81.6 mil shares fully dulted. (Oct 17th, 2003)
@ share price .37 CAN x .77 = $.28
$23 mil MC
Mostly a base metals company.  Zinc.  Also has some silver.  
From “Sheet 2” from the company:
96.6 mil oz. Silver
565,610 oz. gold x 10 = 5.7 mil oz. silver equiv.
= 102.3 silver equiv oz.
(Not all the properties are owned 100%.  Some are only 60% owned with option to acquire more)  I will “guestimate” that they own roughly 70% of the 102 silver equiv oz. = 71.4  (And I count nothing for the zinc., althouth this is primarily a zinc company.
+ 457 mil pounds copper
+ 4 Billion pounds zinc.
$1.2 mil CAN capital in the til no debt.
$23 mil MC / 71 oz. silver = $.32
You get “approx” 16.7 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  Significant zinc bonus, about 2.4 times the silver value.  Smelter credits are estimated at about 60% zinc, 25% silver, 10% gold and copper, and the rest, other minerals.  My method of valuation puts a value on the silver only, not the rest, so this is a better value than my number shows.

I own shares of EXR.V.

  Larry Glazer CEO 1-800-810-7111
63 mil shares fully diluted
@ $.75/share x .77 = $.58 US
$36.4 mil MC
Location: northern Peru
t1 deposit inferred and indicated resources of: 
1.9 mil oz gold, 64 mil oz silver, 1.94 bil lb copper, 1.35 bil lb. zinc.
t3 deposit inferred 64.1 mil oz. silver, 2.1 mil oz. gold
Total of just these two:  128 mil oz. silver, 4 mil oz. gold x 10 = 40 mil oz. “silver equiv” = 168 mil oz. silver.
In the sulfide deposit of t-1, containing 47.7 mil oz. silver, perhaps only 1/2 the silver is “recoverable”.  So, minus half that, or 24 mil oz. = 144 mil oz.
$36.4 mil MC / 144 mil oz. = .25/oz.
You get “approx” 21 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: Share price was knocked back last two weeks due to local protests over proposed mine, and then by an Peruvian government demand that might not be able to be met.  The entire project seems in question.  And then, this last week, the price roard up again.  This is probably the most volitile stock on the list for the past 2 weeks.
Significant copper and zinc and gold bonuses here.  $180 million to develop project.  Cash gold cost projected: $83/  The deposit has “been economic for some time now”.  TG-1 has a positive full feasibility study and and EIA now undergoing government review. 

* MNMM.OB (I own shares) (509) 838 6050 Doug Dobbs
 8.5 mil shares outstanding
10.1 mil shares fully diluted as of the Sept. 3 pp that closed.
@ share price $6.40
$65 mil MC 
261 mil oz. silver resources.  Previous drilling spent over $100 million drilling the property.   
$65 mil MC   / 261 mil = $.25/oz.
You get “approx” 22 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments: 

Mines Management owned 10% of the rights to their property in Montana. The other 90% owner, Noranda, simply gave up on the property and walked away from their mining claim due to “perpetually” low silver prices and political concerns.   That explains the rocketing share price.  So, the MNMM group got 90% of the rest of the property FOR FREE!–the value of which, and the nature of this transaction has just barely begun to be understood by the market, given the low relative price. 

Their property also has about 60% of the value (at current prices) in copper, 2 Billion pounds of copper, and 261 mil oz. of silver.  Doing the math: 261 mil oz. silver x $5.25/oz. = $1.3 Billion. 2 Billion lbs copper x .95/lb. = $1.9 Billion. Total asset value: $3.2 Billion

They do not have an active working mine–Which is a minus.  They will need to raise capital to get a mine going.  Noranda had several estimates for the cost to build a mine and mill, around $250 million.  But it could be less depending on how economic they decide to do things.   They are working on a feasibility study, and avoiding dilution until next year, which is a plus. 

Regarding environmental concerns:  Noranda had a fully approved Environmental Impact Statement (EIS) that led to successful project permitting, so environmental concerns were not a factor in their departure in 2002.

(Copper prices also moved up, from about .85/lb. a few weeks ago to .95/lb.)
For more on MNMM see

I own shares of MNMM.OB.  

Ray Brown, 530-873-4394
70 mil shares
@ $.105 /share
$7.35 mil MC
Three main properties:
Bromide– 372,000 ounces of gold?
Silver Bell–15 mil oz silver?
Deer Trail –287,000 ounces of gold and 27 million ounces of silver… but the lease on the Deer Trail will expire June 1 2004, so they need to raise significant money.
49 mil oz. total.
$7.35 mil MC / 49 mil oz. = .15/oz.
You have an expiring lease on “approx” 36.4 ounces in the ground for 1 oz. silver’s worth of stock.

Additional comments:  They need $4 million to exercise their option to buy the “Deer Trail” property.   They are considering various options on how to do that.  Ray Brown has been in this business a long time, and is excited that he’s got a bunch of younger guys working on the property now, and he’s encouraged by the upward direction of the price of precious metals.

Explorers deserve their own category, since they cannot be valued by my method of looking at reserves and resources of ounces of silver in the ground.  We do not know how many oz. they might have. They are exploring for that. But, given their market caps, and given what I feel is a good price for a silver company of about 30 cents per oz. in the ground, I can calculate how much silver they had better find, in order to justify their current stock price. This valuation method might also help those who have a better feel for how much silver they might find than I do, to value the company. This list, although at the bottom, in no way indicates that these companies are more highly valued than companies listed above. It is also difficult to categorize a company as an explorer, since all silver companies always hold more silver properties that need to be explored.  Higher grade deposits, obviously, could be valued significantly more than my arbitrary number of 30 cents/oz.

(The order is by largest market cap first, not by “comparative value”.)

Sabine Goetz, Investor Relations – 604.488.2657 
Fully Diluted     27,735,000 with Nov. 6th Private Placement
@ share price $6.85 x .77 = $5.27 
$146 mil MC

Additional comments:  III.TO raised $10 million in the recent private placement.  

43.4 mil Fully Diluted shares 
@ share price $2.05 CAN x .77 = $1.57  U.S
$68 mil MC

Additional comments:  This explorer has found bonanza high grades in Argentina, which many people consider to be an outstanding benefit, and they are willing to pay much more for such high grades.   Drilling is now underway (Nov. 26th) 

Dianne (IR) Phone: (403) 265-4356
257.1 Million shares fully diluted
+87 mil shares & warrants as of Oct. 7th, 2003
= 344 mil fully diluted
@ share price $.215 CAN x .77 = $.165 US
$57 mil MC
From p. 1 of 2nd qtr 2003 report: “The company has a policy of not hedging or entering into forward sales contracts.”
Cash flow positive. !!!  
14 projects in the Philippines.
Producing a dore bar of 96% silver and 4% gold from Canatuan project with the following:
827,000 tonnes 3.98 (au)g/t 141.1(Ag)g/t = .14oz/t gold + 4.98oz./t silver
1,497,000 tonnes 1.26 (au)g/t 58.4(Ag)g/t = .044oz/t gold + 2 oz./t silver
= 115,780 oz. gold + 4,120,000 oz. silver
= 66,000 oz. gold + 3,000,000 oz. silver
Total silver = 7.1 mil oz silver
Total gold = 182,000 oz. gold x 10 (@10:1) = 1.8 mil oz silver equiv.
Total silver equiv (Canatuan) = 8.9 mil oz.
+ 2.5 % royalty on “Rapu Rapu” that should be worth about $1 million per year starting within 9-12 months.  (a cash source for an explorer is a big plus)
+ they own a drilling company with 20 rigs.
+ they have a “foot in the door” in China.
+ many other promising exploration properties in the Asian Pacific.
$57 mil MC

Additional comments:  This company exploded in price this week from 16 cents to 23.5 cents when they announced that they would be mining in China: “TVI Pacific Inc. Receives Landmark Approval for Wholly Foreign-Owned Enterprise (WFOE) Status From Chinese Government”. see

They are primarily a silver explorer.  The bonus is they are a producer, and likely are cash flow positive, which are both extremely rare for an explorer.  In fact, the other producers mostly all lose money! 

* CDU.V  CUEAF.PK (I own shares) 
Henk Van Alphen — President (604) 408-7488  
(working on closing a $5 million CAN financing)
28 million shares fully diluted 
@ share price $3.00 CAN (x .77) = $2.31 US
$65 mil MC
Speculated resources, or “exploration potential”:
Providencia — high grades, could have 100-250 mil oz.
Chingolo — Will finish drilling by secnod week in November — Henk says, “may have 400-600 mil oz. “exploration potential” in 200-300 mil tons of rock.”  They got 30-40 grams (1.23 oz.) on the first drill hole, but hope to find 2-3 ounces silver/ton.  Please note, “exploration potential” is a non quantifiable, non-regulated, unauthorized type of estimate.  It is not 43-101 compliant.  Trading decisions should probably not be made on these kinds of shaky estimates, which may be only hype and hope.  An investor who wants to be protected by US regulations should wait for geologists to pour over the drill results and produce numbers that comply with 43-101 regulations, that may one day appear in a company press release.  (Also, the first time Cardero issued drilling results earlier this year, the stock price was cut almost in half due to lower than expected results.  The stock price has since recovered.)  Nevertheless, here’s how those “exploration potential” numbers work out if you do the math:
$65 mil MC / 500 mil oz exploration potential = $.13/oz.
$65 mil MC / 850 mil oz exploration potential = $.08/oz.
Exploration potential:  you might get about 42 – 71 oz. silver for one oz. silver worth of stock.

Additional comments: *** I wrote an article on Cardero in January, 2003. 

Cardero has three properties in Argentina; actively working on two:  Chingolo and Providencia.  Chingolo was just measured as twice as large as previously thought.  They are trying to prove up these properties.   

Providencia also has potentially high grades in several very large conglomerate deposits that can be mined at a profit today.  Their property at Providencia was an active mine, but only a few tons/day.  But they hope to make a large open pit project out of the main deposit, processing perhaps a few thousand tons/day.

High grades are very important in today’s environment, especially if you can buy them cheaply.

They are also acquiring more silver properties, which is another bonus.  This is an aggressive silver company.  More properties help to alleviate the risk of an explorer.

I own shares of CDU.V

* AOT.V ASOLF.PK (I own shares)
1 604 684 8950
36 mil shares outstanding 
3.7 mil warrants at .30 exp June 4, 2004.
39.7 fully diluted. (Nov 2003)
@ $.35/share  x (.77) = .27
$10.69 mil MC (US)
Additional comments: They own 5.82 million shares and 388,000 warrants of Cardero at $.35, which have a greater asset value than their market cap. 

5.82 mil shares x $2.95 (x .77) = $13.22 mil (US)
$2.95 – .35 = $2.6 (x .77) x 388,000 = $776,000 (US)
= $14 million (US) worth of Cardero
14/10 = 1.39 
Minimum CAN share price target = .33 x (1.39) = .46  CAN

The value of Cardero Stock, although an asset, it is not like cash, nor silver.  That much stock is far less liquid.  Ascot might have serious trouble selling that much Cardero stock all at once in the current market.  I suppose Ascot is discounted to reflect the reduced liquidity.  This helps to explain why private placements go out at about 80% of the stock price (20% cheaper), due to the lack of liquidity.  

Nevertheless, this looks like quite an opportunity, since the share price is .35, and they have .46 in value of Cardero Stock.  It’s rare when you can buy a company with a market cap of less value than their assets.

(I’m listing this one out of order, not by market cap, and next to Cardero, because of their position in Cardero.)

I own shares of AOT.V

376 mil shares
@ share price $ .16 
$60 mil MC
“Total Inferred Resource is 34.5 million ozs silver but the district is unexplored for epithermal silver and exploration to date suggests a district potential of 50 to 100m ozs Ag or perhaps much more.” –“Macmin is a silver focussed company” The Texas Silver Project has in-ground resources of 44.5Moz of silver equivalent
$60 mil MC / 50 mil oz. = $1.2oz. 
$60 mil MC / 100 mil oz. = $.60oz.  ***using this number*** since we are counting these as explorers in this categorgy.
You might get up to 8.3 oz of silver for one oz silver’s worth of stock

Fully Diluted: 224,194,196
@ share price .31 CAN x .77 = $.24
$53 mil MC

Additional comments:  Eurozinc does have significant silver.

28 mil fully diluted shares (Nov. 19, 2003)
@ share price $2.44 CAN x .77 = $1.87 US
$53 mil MC

–“MAG Silver Corporation enters the silver market as a powerful force. MAG combines a seasoned management team with two drill-ready geological extensions of high-grade world class producing districts. MAG controls 100% of the Juanicipio property adjacent to the Fresnillo District in central Mexico, currently producing over 12% of the world’s silver from high grade underground vein structures.”

The geologist, Peter K.M Megaw, is also working with  EXN.V, another high grade silver project.  Peter’s philosophy was that it makes sense to go after very high grade silver projects that will be profitable regardless of the share price.  

* NPG.V / NVPGF.PK (I own shares) (604) 646-0188 David Hottman
34 mil shares fully diluted (Oct, 2003)
+ 9 mil shares Nov 26th PP when closed will be:
= 43 mil shares fully diluted (Nov 26th, 2003)
@ share price $1.46 CAN x .77 = $1.12 US
$48 mil MC
(up to $10 million cash in the til from recent PP)
Amador Canyon Silver Project: 50-250 mil tonnes
silver grades average 4 oz. sil/ ton in the deposit
= 200 to 1000 mil oz. silver????? –very speculative at this point. Drilling needs to be done.
$48 mil MC / 200 mil oz. = $.24/oz.
$48 mil MC / 1000 mil oz. = $.048/oz.
At $.12/oz.,
The inverse: you “might” get 23 ounces in the ground for 1 oz. silver.
At $.022/oz.,
The inverse: you “might” get 114 ounces in the ground for 1 oz. silver.

Additional comments:  The private placement announced on Nov. 26th just about doubled the market cap with the dilution, and rising share price from last week.  

Explorer in Nevada. They do not really know how much silver they might they have in the Amador Canyon project.  They are doing drilling this fall, 2003, as they just did a $2.5 million private placement, and another $10 million private placement in late November. The Chariman, David Hottman, says that 90% of the value of the company is in gold, NOT silver, and yet, I’m buying this company for the silver value only, and as if the gold componant was worth nothing. (The gold projects are a free bonus, in my book, and help to alleviate the risk of this explorer.) He has 10 gold projects, and one silver-but it may be big. On the website, for David Hottman’s bio, it says he was a founding member of Eldorado gold. “During his tenure, Eldorado’s market capitalization grew from Cdn $7 million in 1992 to a peak of Cdn $781 million in 1996.”  Please note, exploration is risky, and costly.   
Nevada Pacific Gold has the highest reported exploration potential (for the lowest price) on my list, in terms of total numbers of ounces of silver in the ground for an oz. of silver’s worth of stock.  (Others may, in fact, have better exploration potential because you never really know, but others, if they exist, do not claim any numbers like NPG does.)

I own shares of NPG.V  

Shares Outstanding – 180,721,142
Exchange–LSE Currency–GBX
Mid price/share = 14.375
Is GBX the Brittish Pound? If so… x 1.6998
also, is 14.375 in cents, not pounds?  
14.375 x 1.6998 = 24.43  It’s close to the PK price… 
@ .21 at Yahoo! CAUCF.PK  hmmm
@ $.22.5 US/share, guessing here…
(Mining in China)
$39.6 mil MC

39,240,457 shares Fully, Diluted
@ $0.52/share x .77 = .40 US
$16 mil MC
–About 6 properties in Peru

fully diluted 20 million shares
@ share price = $1.30 CAN x .77 = US $1.00
$20 mil MC / (.30/oz. “good value” factor) = 77 mil oz. that they had better find to justify the current Market cap.  “Esperanza Silver Corporation is solely dedicated to the identification, acquisition and exploration of new silver projects.”   Looking for high grades.

* MMGG.OB (I own shares)
208-665-2002 Merlin Bingham
14 mil shares fully diluted (Oct 23, 2003)
insiders buying on 9-10-2003 at about $1.30/share
@ share price $1.75 US
$24.5 mil MC

Additional Comments:  Zinc & Silver in Mexico: Sierra Mojada.  Sierra Mojada is a Silver District!
Silver: Historic production was 10 mil tons of high grade ore… historic silver production went right direct ship to the smelter, non-milled.  It contained 500-1000 grams silver/ton, or 17.65 to 35 oz. ton.  This means 170-353 million ounces of historic “high grading,” non-milled, production.
(Who knows how much silver is left?)  That’s the question with an explorer.

Zinc: Very high grades: 11.8% zinc.  Potentially the lowest production cost in the entire zinc industry due to new “oxide deposit” chemical extraction process as revolutionary as “heap leaching”.  Exploring for up to 4 Billion pounds zinc.

Project ownership:  MMGG terminated the buy-in agreement with Penoles, who went into default, so MMGG now owns 100% of the project!  See

I believe this is very good for MMGG, since the Penoles agreement makes it more difficult to quantify the value the company.  Now, it is easier to value the company, and the existing shareholders will own more of the project and profits.  The institutional investors who are so hot to invest in CZN.TO right now should consider investing here, in MMGG, or perhaps another silver/zinc project, instead.

To compare to other silver/zinc projects:
Apex: $661 mil MC: 7.8 billion pounds of zinc, 454 mil oz silver, low grades.
Canadian Zinc: $78 mil MC: 3 billion pounds of zinc, 70 million ounces of silver.
Metaline: $27.3 mil MC: exploring for perhaps 4 billion pounds of zinc and who knows how much silver. (170-335 mil oz. historic production)

For more, see the research works article here:

I own shares of MMGG.OB

(416) 368-4525
30 mil shares
@ share price $.88 CAN x .77 = .68 US 
$20 mil MC
Company’s exposure is about half to gold, half to silver in several projects.
Joint Venture with BHP Billiton focused on “Cannington” style silver deposits using proprietary BHP Billiton data.
(all figures are “exploration potential”)
El Salvador – 38.5 mil oz.
Argentina – 6 mil oz. 
Total: 44 mil oz. silver
Total gold: ~690k oz.  x 10 (10:1 ratio) = ~ 6.9 mil oz. “silver equiv”
Total: 53 mil oz. “silver equiv”. (exploration potential or indicated or inferred, not reserves)
$20 mil MC / 53 mil oz. = $.38/oz.
Hopefully, you get 14 ounces in the ground for 1 oz. silver. 

Additional comments:  This explorer/developer tends to focus on good grade, mineable deposits, and form partnerships with other companies to access great information, and expects to produce silver & gold within 2 years, by 2005.  They also took the time to contact me, after having seen this silver report.  

Since this company is about half gold and half silver, the 10:1 ratio really cuts down the “silver equiv” numbers, so keep in mind the “gold bonus” factor here.  But it’s like that with a lot of the companies on this list, so keep that in mind, and do your own math if you want to use the 70:1 ratio.

79.7 mil shares outstanding  (Oct 17, 2003 press release)
114 mil shares fully diluted
@ share price $.22 CAN x .77 = $.154 US
$17.5 mil MC
indicated = 63,400 t x 2738 g/t x .0353oz./g = 6.1 mil oz. silver
inferred = 2100 t x 1,433 g/t x .0353oz./g = .1 mil oz. silver
“gross in-situ value of mineralization is $31.4 million.” 
EXN to own 51% of the project.  Apex is the joint partner. 51% x 6.2 mil oz. = 3.16 mil oz.
(Company expects 114 mil shares fully diluted after takover of Destorbelle, needed to bring project ownership up to 51%)
$17.5 mil MC / 3.16 mil oz. = $5.55/oz.   

Additional comments: “Excellon …is exploring and developing”…. “a Bonanza grade Silver deposit in Mexico.”   The geologist, Peter K.M Megaw, is also working with MAG.V  From J. Taylor’s write up on 2002: “After subtracting capital cost of US $1.8 million, custom milling charges and operating costs, management believs this underground development mine can, over the next two years, generate US $15.8 million or nearly $8 million for EXN’s 51% share.” The company plans to use these proceeds to further drill and explore the property.

* GNG.V  GGTHF.PK (I own shares)
+ 4 mil warrants
= 32.4 mil shares fully diluted
@ share price $.62 x .77 = $.48
$15.5 mil market cap 

Additional comments:  Silver Explorer in Mexico in the the Sierra Madre mountains: Uruachic.
Doing active drilling on their silver property, Las Bolas, “in a month” (as of Oct. 7th).  They hope to take a collection of old silver mines and make them open pittable.  They have some very high grades from chip samples from the tunnels, ranging from 100g to 500g all the way up to around and over 1000g/ton of silver.

I own shares of GNG.V

1-877-859-5200 ask for John Robinson
39.4 mil shares
@ share price $.50 CAN x .77 = $ .39 US
$15 mil MC 

Additional comments: silver in cuba. (final feasibility study completed by Rescan-Hatch) gold in Timmins, Ontario.  If there’s a final feasibility study done, it either means they should be close to production, or there should be some good data available on a reserves picture.  But I just don’t have it yet.

16.3 mil shares outstanding 
(fully diluted?)
@ shar price $.98 share x .77 = .75 US
$12 mil MC
Bonanza grade “grab samples” in southern Argentina near IMA

Bill Hoyt, 785-383-9246
“2.3 million shares outstanding, positive working capital and no debt”
@ $5.10/share
$11.5 mil MC
Historic estimate: “defined Conjecture mineral reserves of 706,000 tons grading 11.8 ounces per ton (oz/t) silver”
–the Conjecture Mine, with a lease-option agreement signed with Shoshone Silver Mining Company
= 8.3 million ounces of silver (lease out)  Since Chester will be receiving royalties, it makes it harder for me to value this company.
$11.7 mil MC 

Jay Oness Toll Free: 1-888-456-1112
36.4 mil shares Sept 2002
+ 3 mil undefined “units” Oct 2003
41? mil diluted???
three main properties in North America
@ share price $.37 CAN x .77 = $.28 US
$11.7 mil MC?

QTA.V is a Sister Company to Western Silver, WTZ above.

15.7 mil shares
@ share price $.67 US
$10.5 mil MC 
 New Jersey Mining Company (NJMC) is engaged in exploring for and developing gold, silver and base metal ore reserves in the Coeur d’Alene Mining District of northern Idaho also known as the Silver Valley – one of the world’s richest silver districts.

25.6 mil shares outstanding (3q 2003 report June, 2003)
@ share price $.53 CAN x .77 = $.41
$10.5 mil MC

Bill Hoyt, 785-383-9246
12 mil shares
@ .70/share 
$8.4 mil MC /.30/oz. “good value factor” = 32 mil oz. they need to find to justify a value price.
In Cour d’Alene, near CDE, HL, & SRLM.PK

Toll-free 1-888-805-3940
16 mil shares outstanding   Use “fully diluted” to be safe.
@ $.73 share x .77 = .56
$9 mil MC
Adjacent to Barrick’s silver property, which is “the fifth largest silver producer in the world”.
“The Property was once almost bought for $34.5-35 million in 1996.”

7.4 mil shares issued
@ share price $1.58 CAN x .77 = $1.21 US
$9 mil MC 

Michael Townsend, President
Toll Free: 1-866-669-9377
Richard one of the IR guys.
18.6 mil shares outstanding
25-27 mil fully diluted.
@ $ .30/share x .77 = .23
$6.2 mil MC

Additional Comments:  –Bonanza grades.  Newmont called them, noticed the property.  Flew out a guy.  El Tigre in Mexico: gold/silver  bonanza style mineralization.  Top grades:  62g/T gold 15,500g/T  silver historic production, from trenching and surface sampling in late 90’s.  Cash on hand: $500,000 CAN

First Majestic Resource Corp (FR.V)
9.1 mil shares fully diluted (Dec. 2003)
@ .71 CAN x .77 = .58
$5.26 mil MC
First Majestic has just acquired a very promising Silver property in Mexico. They are drilling in November.
They linked an excerpt from my free e-book from “8 Reasons why silver is a better investment than gold!” see url below:
Amazingly, I found these guys by chance at while looking up “drill ready silver projects”.  

14.7 mil shares outstanding
17.2 fully diluted
@ .38/share x .77 = .29
$5 mil MC
Silver projects:
Yukon –grab sample of 611 g/t Ag
Argentina –samples from 31 to 5640 g/t Ag

* CEV.V CVEEF.PK (I own shares) (604) 681-8899 John Versfelt, President
45,535,179 shares issued and outstanding
57.4 mil fully diluted (as of just issued quarterly report)
@ .12 CAN x .77 = .09
$5.3 mil MC

I own shares of CEV.V

14.3 mil fully diluted (July 15, 2003)
@ share price .225 CAN x .77 = .17
$2.5 mil MC 


$17.1 mil MC
“Itronics Inc. is the world’s only fully integrated photochemical recycling company. It provides photochemical waste collection services, recovers and refines silver from the photochemicals,”
–I heard Itronics recycles very little silver currently, late 2003.  Located in Nevada.

Additional comments:  Itronics is not an explorer, and not a miner, and has no reserves.  As such, it is extremely difficult for me to value this compared to other silver stocks.  I just don’t know how to value this one.   

Final Category: Silver stocks FOR YOU and I TO RESEARCH further:

I strongly recommend you try to “get ahead of me,” and research these stocks to see if I left out any great values.  I probably did.  I simply did not have time, or could not yet find information (without using the telephone) on all the two key figures needed to get the “price per oz.” in the ground.  You need: 1.  The number of shares fully diluted x share price to get the market cap.  Then, 2., you need an estimate of the oz. in the ground.   Usually, I’ve been finding the oz. in the ground resource estimates right off the company webpages, and I get the number of shares by looking for it burried in the financial statements like the quarterlies or annual reports, which are also usually right on the company webpages.    Have fun researching for silver companies, and let me know if you find any good ones, and I’ll add them to this list.


Legend Mining 
specialising in exploration and production of silver.
Silver at the Munni Munni Joint Venture in the West Pilbara region of Western Australia

Mountain Boy Minerals Ltd (MTB.V
TEL: (250) 636-9283
high grade samples:  3640 g/T Ag to 45.5 g/T Ag

Mascot Silver Lead Mines MSLM.PK
Coeur d’ Alene, Idaho
“Though we have reserves and could conceivably mine them, it frankly makes no sense to do so at current prices. … The end of the silver bear will bring a number of the now-dormant small companies back to life…”

Silver Buckle Mines Inc (SBUM.PK)
Coeur d’ Alene, Idaho

Fischer-Watt Gold Co Inc (FWGO.OB)
Coeur d’ Alene, Idaho
admin@fischer-watt George Beattie, 208-664-6757

Merger Mines Corp (MERG.PK)
Coeur d’ Alene, Idaho

Malachite Resources NL MAR.AX
http:// 216,559,942 Fully Diluted shares
oxus will spin off:  Khandiza is a high-grade zinc, silver, copper and lead deposit located in the Sariasia region of southeast Uzbekistan.

Silver Bowl –not yet public?

SML.V 604-306-0391 Bill McWilliam, Chief Executive Officer
–several people emailed me about stealth minerals this week.

SRY.V (416) 368 6240
fully diluted 5.9 mil
– Current projects centered in the Sierra Madre Belt of Mexico 

Silver Mountain Lead Mines Inc (SMLM.PK)

Silver Butte Mining SIBM.PK
(mine abandoned in 1996, copper/zinc waste water?)

Silver Verde May Mining Co (SIVE.PK)

Metropolitain Mines Ltd (MEMLA.PK)

Silver Surprize Inc (SLSR.PK)

Standard Silver Corp (SDSI.PK)

Horn Silver Mines Co (HRNS.PK)

Golden Phoenix Minerals Inc (GPXM.OB)

Teuton Resources Corp TUO.V TEUTF.PK

GoldSpring Inc GSPG.OB

Andean American Mining Corp AAG.V ANMCF.PK

Langis Silver & Cobalt Mining Co Ltd (YLS.V)
Phone: (416) 628-5936

Cangold CLD.V

Chariot Resources Limited CHD.V  –Chariot Resources was at the Gold show in SF.  I got some material from them, but they are an explorer, with no “ounce in ground” estimates.

Ross River Minerals Inc (RRM.V)

La Mancha Resources Inc (LMA.V)
 Phone: 604 990-9599

Articles like this one, that present opportunities like these, can tend to move the markets in these stocks. So, be careful when buying. If you place any market orders at the open for any of these small stocks, you might end up buying at prices that are significantly higher than you intended.  Limit orders might be better, but then, you run the risk of your order not being filled if the stock price exceeds your limit.  And bid / ask spreads such as 15% on small cap silver stocks are not unusual.  Markets can especially be moved given the wide readership of the internet. I’ve seen markets moved even by small private newsletters such as and (I subscribe to both). Some of these stocks can move up 15%, 30%, 50% or even over 100% in a single day. Thus, valuations can change very, very quickly. So, be careful, and re-check the numbers if the prices move up. Do your own math.

Also note, the majority of these companies have an emphasis on silver.  Most silver is produced as a by product of other mining, like lead or zinc or copper mining.  Those companies that primarily produce other minerals are not featured in this report.  This also helps to explain and prove, that silver is undervalued.  If silver miners cannot mine silver profitably, and this report shows that to be true, then something is wrong with the silver price.  It must go higher.

This report, and my method of valuing silver companies, depends on a much higher price for silver than exists today to be most accurate and most successful.  If silver prices go up significantly, my picks will do well.  If silver prices remain flat, then many of my picks should not do well.  

To learn more about the silver market:

For information from the SEC on how to protect yourself from a “pump & dump” scam, see

Several people have told me that they don’t get information this good even when they sign up for annual newsletter subscriptions from others that cost from  $100 – $300.

You can help to make sure you can keep getting this report for free if you sign up at The Silver Stock Report

Jason Hommel
The Silver Stock Report

Final Disclaimer:  I have not received any compensation from any company for writing up my weekly report on “Silver Stocks–Comparative Valuations”.  I own shares of the following 12 silver stocks: CZN.TO, MNMM.OB, SRLM.PK, CEV.V, CDU.V, NPG.V, CFTN.PK, GNG.V, EXR.V, SVL.V, MMGG.OB, AOT.V.  These are required disclaimers by the SEC: whether I’ve been paid, and what I own.  I believe the SEC intended this to be a cautionary note that I own these shares, not as a recommendation or endorsement.  I reserve the right to buy or sell any stock at any time.