At 12 cents, Riverside Resources (RRI.V) remains a significant value for jittery junior mining stock investors. The stock has limited downside, but significant upside by way of exploration, joint venture or spin-out opportunities.
Tuesday, October 17, 2023
Nearly one year ago, we wrote that Riverside Resources (RRI.V) was the stock to buy in depressed markets. We noted that the company had cash, no debt, no burn rate and a shareholder friendly CEO.
Nothing has changed and at 12 cents Riverside Resources remains a compelling value with limited downside risk. For jittery junior mining stock investors, the stock presents a tremendous value.
Conservative and Shareholder Aligned CEO + Low E/V
CEO John Mark Staude stands out among the junior sector as a very well-known, knowledgeable and conservative CEO.
While other companies dilute their share structures as if they were planning to list on the Australian Stock Exchange, Riverside Resources is a no dilution enterprise. The company is 16 years old and has only 78.5 million shares fully diluted. It has never rolled back.
The enterprise value is ridiculously low at just under CAD$3 million. The company has CAD$7 million in cash, no debt and no warrants outstanding.
A Robust and Diversified Portfolio for Peanuts
With an enterprise value of less than CAD$3 million, an investor acquires Riverside's full portfolio for peanuts.
Riverside Resources owns 12 royalties (one of which is near production).
It has numerous highly prospective projects such as three notable gold assets in the Western Abitibi, copper and polymetallic projects, and a rare earth project in British Columbia.
Riverside has a tradition of building joint ventures with major mining companies. Today, it is joint venturing with BHP.
The stock adds octane to investors' portfolios by spinning out projects to shareholders. For example, Capitan Silver Corp. (CAPT.V) was spun out as a share dividend and promptly revalued +240% before correcting.
As one might expect, a well managed company such as Riverside Resources will attract a high quality and stable shareholder base, such as Adrian Day (7%) and Sprott Global (3%).
Bottom Line: Big Upside, Very Little Downside
Riverside Resources is a well balanced prospect generator with numerous gold, copper and critical metals properties in Canada and Mexico.
A potential spin out of their Ontario gold assets could add a short-term rerating catalyst next year.
Disclaimer: SGL does not provide investment advice and is not a registered investment advisor. Always do your own due diligence before making an investment. Investing in securities, especially junior miners, can be risky and never invest money you cannot afford to lose. SGL cannot guarantee the accuracy of the information in this post. SGL has attempted to present the information fairly, but we own shares of RRI.V so bias cannot be excluded. SGL and its contributors have no relationship with Riverside Resources. SGL or its contributors may buy or sell shares at any time.
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