Kirkland Lake
KL is BY FAR my largest holding and I have owned it since $8 in 2017. Your best source of information is the weekly wrap-up podcasts I record for Sprott Money each week. For example, today Eric discussed the impending prodcution reports that are due sometime next week. You should have a listen.
https://www.sprottmoney.com/Blog/ready-for-another-big-move-in-gold-and-...
Kirkland Lake
is also my largest holding. My first shares were acquired in Feb 2016 when I received 90 in the takeover of St Andrew Goldfields, which had just started production on the Taylor mine. I think KL was trading at a CAD $6 handle then (they are now CAD$57)
I mention this since it was a share purchase and St Andrew shareholders got 29% of the combined company very similar to the current 27% for Detour Lake shareholders. Both takeovers also involve operations in the geographic region of KL's Canadian operation in the Abitibi greenstone belt.
So I've been looking at Detour (mostly because I have difficulty understanding the book announcing the special meeting for Kirkland voting). Detour has a very informative website that I hope will be maintained. Basic annual operations are available: https://www.detourgold.com/operations/detour-lake-mine/default.aspx and it's very easy to produce charts. https://apps.indigotools.com/IR/IAC/?Ticker=DGC&Exchange=TSX# for example quarterly gold production.
Interestingly I found a very useful write up by Franco Nevada which has a 2% NSR on the Detour Lake mine. Apparently the revised mine plan, which extends the life of mine, is also expected to reduce output in 2019 and 2020, while the West Detour project (mine) is expected to complete permitting by 2025. https://www.franco-nevada.com/our-assets/assets-list/canada/detour-lake/...
We already know KL management are excellent operators and while the reduction in Detour production may impact share pricing in the near term I expect the stock to show excellent values within intermediate term of 2-4 years, irrespective of gold price.
from last Friday
Eric discusses KL's pending production report at about the 14:20 mark: https://www.sprottmoney.com/Blog/ready-for-another-big-move-in-gold-and-...
KL And Detour
Does anyone know the total number of outstanding shares their will be if the deal goes through? Thanks in advance
KL share price
KL share price has been stuck in the mud to down 20% since the first discussion of the Detour merger. In one of Eric Sprott's discussion he was asked when would Detour's numbers be mixed in with KL's to which Eric said imediately.
KL is estimated to report earnings around Feb 19th with I assume Detour thrown in. It will be interesting to see how the market will react. Eric also said a while back smething like 40% of KL stock was being shorted and watching pricing it sure seems that way as KL is battling the anti PM sector crowd on its own front.
Most of the miners are rallying today while KL is down 1%. I do hope after 4th qtr earnings when the miners reports show a good upside the institutional money comes flowing in and if silver increases also maybe we will finally get more positive share prices as it should be 3 to 4 times the movement of the metals. With that in mind we have some ground to make up also.
Hi Craig, would you stil buy
Hi Craig, would you stil buy Kirkland Lake shares? The price today is 48 dollars!
Thanks
Alex
KL bounce
Strong bounce today (~4%) after 5 red candles all last week. Maybe the $36 chance to buy is disappearing. FWIW, I added a few at $37.50 last week in addition to my March $40 calls that I got as it sank below $39.
Alex, I bought after KL went under CAD$50, it has a chance to close above that in a day or two.
nice work by Steve
And yes I would. Mentioned this in today's am post.
KL
Was my biggest holding for a year or two. Began taking profits around $48 and moved sales overtime to DFMTF, DSVMF, ELYGF, GLVMF, PGEZF, IRVRF, LOMLF,MAKOF, MMNGF, MAIFF, NSHRF, SMDZF, VIZSF. I also used some Great Bear, Silver Crest and Novo profits but kept core positions in those.
The point being, rather than hold onto my good profits in KL and keep waiting for the"real bull market" in PMs, I decided to compound my KL earnings. I also used some of KL and AG earnings over time to pay taxes which makes the tax impact less in my mind if I pay them with some earnings.
Selling KL seemed like a wrong decision at the time, but many of those I bought have made good earnings while KL tanked. I am hoping the new ones go up more than KL when Jamie Dimon goes to jail and the "real PM" rally starts.
Q1 2020 consolidated production results
Press release out today; have not listened to conf call yet; but must assume the 3.8 Million tonnes of ore processed at Detour mine cost a bit less than guidance with oil price now 30-40% below when guidance was released. Now, all miners will suspend forward guidance; making ‘beat’ or ‘miss’ stock rigging games tougher for the banks.
Notice the consolidated production table; just how incredibly rich the Swan zone continued to be... its a Gold Mine?
Major drill results press release July 30,2020
If these were Silver intercepts rather than gold; they’d be considered very high grade... the Swan Zone is out of this world high grade Gold; and throws off so much cash @ $1900 Gold its enabling huge exploration activities. The drill report is stuffed with great intercepts.
The share float is now 275 million; only 65 million higher than pre Detour acquisition, via current share repurchase program; and still over $500 million in cash as of quarter end even after 11,000,000 shares repurchased in 2020.
As the share price rises; I imagine they’ll lay off repurchases and that cash will accrue towards funding another acquisition; or dividend rise if $1900 Gold is sustained.
Terrific new drill results
Kirkland Lake intersects exceptional gold grades
Market has completely ignored KL results...
... and in this lies opportunity.
I hold a fair # of shares long; but have also been picking up a few Dec182020 C55 Calls; first @ $1.55 last week and now sitting at $1.00 today.
My thesis is that PM market volatility is going crazy for at least a few days next week; and there may be a narrow window to flip these on a stock price blip towards $55 post election; else these calls will quickly die on the vine if stock price stays below $50.
Fundamentally, KL should rocket higher if Gold reacts positively to the 2020 election... so you are getting over 40:1 leverage on KL for the next 6 weeks. Big picture; just a side wager to spice up the closing of 2020 by taking a seat on the risky side of the boat.
Crash dummy- options fail
KL Dec C55's look to be busted... with shares now trading as if Gold is sub $1500 again. Chart wise; maybe $35 low side target? I am nibbling here... anyone have a view?
