Analysis - Silver


5 Year Silver Prices - Silver Price Chart
Silver nugget

Silver (chemical symbol: Ag) has roughly 200 exploring/developing/producing companies listed on the two Canadian exchanges with a registered resource estimate. Silver is also a precious metal just like gold, but much cheaper, and its main purpose is for manufacturing goods.

One would say this would provide healthy supply/demand mechanisms, but this isn't exactly true as the price of silver is more or less connected to gold within certain ranges.



San Miguel open pit; Pirquitas Mine

1. Introduction   

Executive summary

  • Dolly Varden is looking for much more high grade silver on its prolific land package, just inside the Golden Triangle
  • A new management team has taken on Dolly Varden under the leadership of Gary Cope as President & CEO.
  • After raising C$7.2M, Dolly Varden is ready for a major drill program in 2017.
  • The 2016 drill results are in and look very promising.

Executive summary

  • Kerrisdale Capital Management, a short selling hedge fund run by Sahm Adrangi, wrote a short thesis on First Majestic
  • The author implied that this well-known silver producer was currently 70-80% overvalued, and also focused on the promotional background/nature of CEO Keith Neumeyer
  • He isn't the only big name promoting his company, and not the only big name betting on much higher metal prices
  • Although First Majestic actually has a high valuation based on the main ratios and multiples, 70-80% seems to be harsh and doesn't do justice to the company in my opinion
  • Surprisingly, after a few weeks since the report came out, it seems that instead of shorting, Kerrisdale actually called a bottoming process for First Majestic