Tiny Gold Stock set for possible breakout

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What is the “Tiny Gold Stock set for possible breakout?

So you've seen the teaser “Tiny Gold Stock set for possible breakout“.  Very intriguing indeed.  In fact, if you have listened to promo on the splash page, you'll hear that this “explosive mining stock” has initiated a $20 million share buy back, and that it pays out at least 1/3 of the cash flow  to investor dividends.

Is there such a company?  There sure is!

On September 27, 2011 this company announced a $20 Million stock repurchase program.

The plan, to be effective immediately, is an attempt to improve the company's share price, which it claims is undervalued.  “Management believes that at current price levels the company's stock is undervalued and represents an attractive investment opportunity . . . in addition to an opportunity to further reduce its already tight capital structure,”

On October 5, 2011 this company declared its 15th monthly dividend.

“The company, which has operations at its El Aguila project in the southern state of Oaxaca, Mexico, has returned over $28 million to shareholders in monthly dividends since declaring commercial production in July 2010. “

On October 6, 2011 this company announced that third Quarter increased by 87%.

“The production result for the three month period ending September 30 represents an 87% increase from the previous quarter, the gold producer said.”

Not bad at all….but here is another cool tidbit about this company.  As you know when economic and political turmoil starts to raise its unfortunately all too familiar face, Gold prices go up.   It is argued that if all else fails, gold is the only real tangible asset left to barter with.   This company actually took $1 Million of its cash to mint one ounce gold and silver coins to be distributed monthly.  “Many investors would rather hold physical gold or silver rather than fiat currencies that will continue to be debased… There's been a lot of interest from shareholders.”

Getting tangible gold as a dividend may be something that will catch on, while some larger companies call this “gimmicky” and “complicated.”

This company's initial appearance looks to be pretty good, not to mention fun.  It also looks like this company has a very investor friendly management team.

So what is this “Tiny Gold Stock set for possible breakout”, this “explosive mine stock”, this guru's “top low priced gold stock pick?”  None other than junior miner Gold Resource Corp. (AMEX:GORO).  But before you even think of buying hype, do you research.  Check out the company SEC filings for yourself, look at its historic press releases and match up public claims with audited numbers.   The 30 Day average volume on (AMEX:GORO) is fairly light for a company that seems to be doing so well, so are the claims that Wall Street analysts just haven't noticed Gold Resources yet true?  Keep in mind, that small companies need to create a nice long positive track record before Wall Street gives them a glance, this could be the case with Gold Resources Corp.  It reminds us of a penny stock pitch, “the next big secret” type deal. Always do your proper due diligence before jumping into anything with your hard earned money.  But after 15 monthly dividend payments, something good has to be going on at Gold Resources Corp.

Dividends are always attractive, especially when they pay out regularly, as Gold Resource Corp has been doing.  Here's a couple other miners known for paying out large dividends, but trading at much higher prices:  Newmont Mining (NYSE:NEM) and Barrick Gold Corp. (NSYE:ABX).

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Written by John Thomas

I began my investing career back in 1998. I quickly discovered day trading, small cap and penny stocks. I was the editor of my own investment newsletter, stock promoter, investor relations, public relations and have witnessed the back-end process of taking a private company public through reverse merger and registration. That is roughly over a decade in a nutshell. During this time I learned how to identify the rats, sharks and people who truly want to help you learn about investing. Now I do research and write.
My hope is to pass along nuggets of information that could help or the very least entertain you on your way to financial success.

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