AG.TO set to rebound following TSX Index selling pressure relief
Argonaut Gold (AR.TO) was removed from the S&P/TSX Index in Dec, adding selling pressure to a prime tax-loss selling candidate. It broke out of the recent downtrend with heavy volume on Dec 19, creating a bullish swing trade set up with a $3 target (82% potential gain). The abnormal volume on Dec 19 was due to final Index rebalancing.
The company now trades with a market cap of $254M, yet has cash of $45M and Assets of $918M - and no long term debt. 9 month YTD revenues are $117M with EBIT of $8.5M.
This is nicely set up to rebound to $3/share before encountering longer term downtrend resistance - which will only be broken with an improving gold price.
Share price will obviously fluctuate with gold prices, but the stock has dropped by over 50% since Oct 3, yet gold is the same price ($1,200).
The company now trades with a market cap of $254M, yet has cash of $45M and Assets of $918M - and no long term debt. 9 month YTD revenues are $117M with EBIT of $8.5M.
This is nicely set up to rebound to $3/share before encountering longer term downtrend resistance - which will only be broken with an improving gold price.
Share price will obviously fluctuate with gold prices, but the stock has dropped by over 50% since Oct 3, yet gold is the same price ($1,200).