Pescod Late Edition: AMZ.
AMAZON MINING (V-AMZ) $2.65 -0.13
For those who ventured into the market about a year
ago when it looked like the world ending, it has certainly
been rewarding. Some analysts came up with some excellent
suggestions and we were glad to have followed and
written about many of them in our space here.
Of all of them though, one of the best by far has been
John Kaiser, whose work ranged not only from diamonds
(Peregrine Diamonds) to gold (Brett Resources) but to rare
earths as well. That was one sector no one has heard
about and most brokerage houses still don’t follow. But
John had some of his biggest wins there, ten and 20 baggers
such as Quest Uranium and Avalon Rare Metals.
So it’s time of year to catch up with John for his picks
going forth. While our favourite question is usually, if you
could only buy one stock today, what would it be? John
suggests…“no”, there are six stocks that he thinks a person
should be considering.
One of the picks he has for the coming year is Amazon
Mining, which should be timely in the next couple of days
with drilling results out on their potash play in Brazil. That
stock has almost tripled since we started following it for
John, but for readers of the Bottom Fishing Report that he
edits, it’s even better.
When we interviewed him last week, Kaiser suggested
that potash is one of those stories that fits in with the
“scarcity of supply themes” that he emphasizes, in particular
Brazil, which has to import 90% of the potash it
uses is a case where Brazil very much wants this project
to work.
Kaiser points to once drilling results are in shortly, a
pilot plant will have to be built and produce some thermal
potash which will then have to be put on some crops to
prove it works. But all of this work should be done over
the next six months and while some easy money might
have already been made (that’s our thought) he still has a
$5.00 to $10.00 target down the road, suggesting this
could become a billion dollar story.
Having been down to Brazil and seen first-hand the
booming economy in Brazil and the importance agriculture
plays (Brazil is an enormous player in everything from
sugar to coffee to oranges to you-name-it) and with the
torrential rains they receive that leech the soil, they need
huge amounts of fertilizers and considering they expect
agriculture to expand much further in the coming years, it
just means the demand for fertilizer will be ever-greater.
We should point out that an attempt had been made at
thermal potash decades ago, but that was at a time that
fertilizer prices were one-tenth current levels.
Amazon Mining
Two points we make on the Amazon story: First of all, investors looking at market cap levels can compare some
of the Canadian operations that involve huge operations at great depth, cost billions to build and five to ten years to
build compared to Amazon’s, whose rock is at surface and could be in production in a fraction of the time of Canadian
operations and is located right near to where it is needed most.
But get to the market cap. A company like Potash One has a market cap in Canada of roughly $250 million.
Amazon’s market cap it still (even at the new record high it hit today) a mere $90 million. Dirt cheap for somebody
big in Brazil that might want to take a look at the company down the road. |
