Potential Miner Breakout
- Posted by Frank Zorrilla
- on November 2nd, 2012
Primero Mining Corp. engages in the production of precious metals in Mexico. The company focuses on producing gold. It owns 100% interest in the San Dimas gold-silver mine located in San Dimas district, on the border of Durango and Sinaloa states. The company was formerly known as Mala Noche Resources Corp. and changed its name to Primero Mining Corp. in August 2010. Primero Mining Corp. is based in Toronto, Canada.
Here is the news that caused the spike:
(Reuters) – Shares of Primero Mining Corp (P.TO) rose more than 41 percent shortly after the market open on Friday after the junior gold miner said it had received a positive ruling from Mexican tax authorities on how it reports silver revenues.
The ruling confirms that Primero can record silver revenue and taxes from its San Dimas gold mine in Durango state at the realized silver price rather than the spot price.
It is an important distinction, as Primero has a stream deal whereby it sells silver by-product produced at the mine to Silver Wheaton Corp (SLW.TO) for just over $4 per ounce. That is well below the current spot price of $34.89 per ounce.
Shares of the Toronto-based miner rose 41.7 percent $7.51 on Friday morning on the Toronto Stock Exchange.
(Reporting by Julie Gordon; Editing by Peter Galloway)
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.
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Frank Zorrilla is the founder and chief investment officer of Zor Capital LLC.He began his Wall Street career 10 days after his 20th birthday when he became a Series 7 licensed stock broker. More »
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