Wednesday, January 31, 2007

Google Growth Story has Ended, Game of Musical Chairs will Begin, SELL if you can

Actual results reported today is even Worse then in my recent projection:
Free Cash Flow for the Q4 2006 is ... only 0.544 bln USD vs my projection of 0.61 bln USD and it is with Tax rate of 13% (?!) for Q4 and 23% (?!) for the whole year. Do I smell a cooking oil here? With such creative accounting earnings are meaningless, we really can try to understand the value here only by Free Cash Flow Ratio to recent capitalization. Total FCF for 2006 is 1.112+0.544=1.656 vs projected 1.722. The Google market cap of outstanding 313 mln shares at the closing price 501.5 is 157 bln USD.
MC/FCF ratio is 95!
Yahoo! has MC/FCF ratio of ... 28.9.
Growth story has ended here and we have Great Company with Completely Unsustainable Valuation. Perception of the crowd is so far away from reality that nobody is even checking numbers any more.
When you will normalize all the accounting tricks with taxes and SBC and R&D tax credit you can understand that real picture here is Slowing Rate of Growth.
Free Cash Flow as Ultimate Measure of Company ability to generate cash is indicating that Company is unable generate enough Cash in order to sustain valuation, it is under compression and MC/FCF is approaching Totaly Insane Level.
If we will apply "normal" ratio of 40 for fastest growing company, leader in the market and real innovator we will come to possible market cap of 66.24 bln USD which will bring us to Target Price of USD 212.
It looks like MR Market is starting to hesitate about share price of this enterprise.
Once The Double Top will be confirmed by Sell Off with significant volume the Reversal Pattern will dominate on this stock for the whole year.
I will keep you posted (those who will not be forced to Sell PC or unable to pay for electricity).

Monday, January 29, 2007

Tenke Mining Buy at channel support line

KB Home Bear Market in Housing just started

Google is losing its ability to hold our interest to competitors.

It is very interesting to find out from this very well written article that Google is actually losing competative game in retention of interest from the internet audience and its importance and further accepted by the investment crowd "implide value" are way overated which is becoming evident in technical picture and deteriorating fundamentals :
"Key Observations
Only 20 domains capture a whopping 39% of all our time spent online.
Only 2.1% of our time is spent on (GOOG) (includes all sub-domains). This surprised me somewhat, given how much I think I use Google everyday. I still think I use Google quite a bit, but now realize I don’t spend much time on the site itself. Google is NOT a portal with loads of content. Gmail and Google News are the only services that I spend considerable time on. Search, Maps, etc are quick look-up utilities, as they should be.
Even if one adds time spent on Google's (#12) to’s (#5) tally — it still only adds up to 2.7%, and is well below time spent on (EBAY) (#4).
MySpace (NWS) (#1) is miles ahead of Yahoo! (#2), however Yahoo! impresses. Yahoo holds a significant lead over, Microsoft's (MSFT) and Yahoo simply needs to merge with MSN to take #1 (hint hint)
The presence of on this list is surprising, but hey, everyone needs a friend, or two!"

Sunday, January 28, 2007

Weekend Puzzle, Avino Silver Break Out in the making

Spot ten differences in following formations:


Maybe soon we will find out that these stocks are really in different stages of market perception of thier value and noone should trust to any trading system or even me ...without thinking, look at P&F projections.

I hope you did not miss after your DD Entry point in Goldies and My Silver Gang watch out for ASM.v break out:

Thursday, January 25, 2007

Avino Silver President's Interview

Major catalysis:

- infrastructure is in place;
- past producing Silver mine with resources;
- could be put into production within 12-18 months;
- exploration drilling.

Wednesday, January 24, 2007

GOOGLE is in Mathematically Perfect Reversal Double Top Formation

Market Update. CS

I hope that apart from trading (calls SSRI and SLW) you had a good look on some Juniors for investing, my take is that biggest money to be made in Juniors on the edge of feasibility/production side, to get into nice discovery is always welcome as well. Take a look at my crazy staff:, TNR.v. Silvers: ASM.v, SRLM.ob, MGN, SST.v. New positions in CUU.v and CNU.v are doing nicely. I had a nice run in Uranium,, JNN.v,

Just recently one Russian guy set up investment fund with 900 mil USD to invest in Gold mining stocks in Switzerland: as price of gold will move valuation for OZ in the ground will move as well from recently 60-100 USD for OZ to 200. Juniors with resources in compliance to NI43-101 will explode.

We need just One present of Google valuation to spike Silver market.
Disclosure: for amusement and educational purposes only, no investment advise is given in any articles on this blog. (yea: I am GREEEDY and UNPROFESSIONAL could not do as good as others with Strong Buy on GOOG)

Google Bear Case Update

Please check Hard Data on Google Case for complete picture:
I will apply to my analyses latest analyst projection of sequential revenue growth of 18% Q4 on Q3 and latest Yahoo! Figures, (by the way Technicals weekly at BUY for YHOO, but I am not buying and not engaging anyone to do it in any case.)
So lets look at Google: Total Free Cash Flow for nine months is 1.112. If we will project Rev growth for Google at 18% for Q4 vs 9.3% for Q3 they will make Rev Q4 3.2 bio USD (in line with based on PWC and 41% of market 3.2) Net cash from operations at 37% of Rev 3.2 will be 1.184, if we apply 20% growth for NCFO in Q4 (vs +19% Q3) we will get 1.2 so lets assume NCFO will be in the middle = 1.19. What about Capex? I think it will be increasing dramatically with moving into video: broadband, storage, new blades, electricity. But if we even apply same growth to capex as to Rev +18% (they said it will be bigger then Rev growth, Q3 was +29%) Capex Q4 will be 0.581. So, Free Cash Flow in Q4 will be NCFO-CAPEX=0.61 and total FCF 2006 will be 1.722 If stock will not move from 479.05 we have MC=146.66 billion MC/FCF=85.2! YHOO had FCF 1.267 in 2006 (lower then lowered recently) with MC at 36.67 their ratio is MC/FCF=28.9 If the Google will manage to make even 2.9 EPS in Q4 (+23%) - it is average analyst estimation now in Yhoo (do not forget annual charge for all those "to be expensed option related expenses which they did not account in past Qs) GAAP 2006 will be 9.54. So with GOOG at 479.05 we have company with 2006 est MC/FCF=85.6, P/E=50.2, P/S=13.7 with slowing growth in EPS and Revenue and most important with dramatic compression in FCF. YouTube will bring dilution, much more CAPEX in Video Game and No revenue so far. What is the more reasonable valuation of Google: if we give GOOG MC/FCF=40 (38% over YHOO for leadership and "strength") MC with 1.722 FCF must be 68.88 billion with 306.16 million shares outstanding (YAHOO! finance)...225 share price. When MR Market will figure it out I do not know, but I think that this valuation is unsustainable.

Saturday, January 20, 2007

TNR Gold Announces Winchester Phase II Exploration Results

In July 2006 they reported hole 06-45 with 23.6m of 1.9 g/t

Now in 5 holes 4 returned gold mineralisation with:

DDH 06-53 with 13.4m of 1.22 g/t and DDH 06-52 with 9.2 m of 1.96 g/t

Primary focus for 2007 will stay on Winchester Zone.

They are talking here about Nova Gold's Donlin Creek multi million OZ Au type of mineralisation. Winchester zone is 16 km south of TNR GOLD's Shotgun property optioned from Nova Gold (50% ownership) where 1 mil OZ Au in inferred resources reported by Nova Gold.

Now the question is whether this discovery could be proved to be Low Grade Bulk Tonnage Deposit with few millions OZ Au.

Management just granted themselves options at Cad 0.2, so we can expect more news and money coming into this story.

Friday, January 19, 2007

TNR Gold La Carolina Project Exploration Commences

It is going to be Hot Summer in Argentina this year on TNR Gold properties:
"La Carolina:
El Camino is partially exposed on surface by old workings. In 1988, Argentina’s Direccion de Fabricaciones Militares (DGFM) drilled 13 vertical holes on the showing. All of the holes intersected gold mineralization. The best hole intersected 138m averaging 2.5gpt Au and included 25m averaging 4.2gpt Au, 33.9m averaging 1.22gpt Au and 29m averaging 1.44gpt Au. As part of an extensive drill program in 2004, an inclined hole was drilled to confirm the DGFM results and intersected 20m averaging 1.43gpt Au, 34m averaging 0.52gpt Au and 6m averaging 1.41gpt Au. This drilling confirms the existence of an intensely altered gold bearing hydrothermal breccia pipe with chalcedony and pyrite matrix which suggests that the pipe remains open to depth and the true width of the pipe remains to be determined.
The Mogote target, located 1,000m south of El Camino, was drilled by DGFM and intersected 3m averaging 59.5gpt Au in the basement rocks in contact with the Tertiary volcanic rocks. This target has not been followed up and remains open at depth and along strike."

Sunday, January 14, 2007

Google Advertisers are Cutting spending

It will be very difficult to justify valuation with diminishing rate of growth at this Insane levels of capitalization:

GOOGLE we need just 1% of its Market Cap to Launch Silver Rocket

Tenke Mining is unknown to Wall Street Crowd Developing Producer of Strategic Resources

Sterling Mining is Another Forgotten Treasure

Mines Management is one of the Silver Play Most OZ AG in the Ground

XAU Juniors Stage Play is flirting with 150 Long Term Breakout

HUI New Entry Point New Wave Up 3rd subwave indicating following Gold Move Up

Silver Move will be More powerful then Gold after consolidation

Gold is consolidating before powerful move Up

OIL New Bear Market or Correction?

Saturday, January 13, 2007

TNR Gold Minera Andes Los Azules 6-10 billion Cu lb Target

221 m 1.62% Cu and 173 m Cu 1.0% are on TNR Gold's property. President of Minera Andes is talking about Significunt Size Cu Discovery of 6 to 10 billion Cu lb Target. Scoping Study is underway.

TNR Gold Los Azules Cu Discovery property rights

Minera Andes - Xstrata Agreement:
"Xstrata InterestAfter completion of the scoping study, the data will be presented to Xstrata Copper Americas, with whom Minera Andes has a letter of intent for Los Azules. The letter provides that Minera Andes can earn a 100 percent interest in Xstrata's portion of Los Azules by spending at least US$1 million on the property from the date of the agreement (November 2005) in order to produce an economic assessment. If the study shows the project to be potentially economically viable and can produce 100,000 tonnes of copper per year for ten years, then Xstrata will have the right to "back in" to earn a 51 percent interest in Los Azules. To do this, Xstrata would have to reimburse Minera Andes three times over for its expenditures on the property, complete a bankable feasibility study within five years and assume underlying property commitments. "
Xstrata - TNR Gold Agreement:
"Xstrata AgreementMinera Andes owns a 100 percent interest in its land that makes up the southern half of the property. The Xstrata lands (see map) are subject to a letter of intent whereby Minera Andes has the right to earn a 100 percent interest in Xstrata's property by spending at least US$1.0 million on the property over the next four years, making payments to keep the property in good standing and producing a preliminary economic assessment (to NI 43-101 standards). If the preliminary assessment shows the project to be potentially economically viable at a potential production rate of 100,000 tonnes (200 million pounds) of copper per year for 10 years then Xstrata will have a one time back-in right to earn a fifty one percent interest in the combined properties by making a cash payment to Minera Andes of three times Minera Andes' expenditures on the property, completing a bankable feasibility study within five years and assuming underlying property commitments. In the event that the preliminary assessment does not meet the size criterion contemplated above, Xstrata's interest would reduce to a first right of refusal on any subsequent sale of the property. All lands that make up the property's mineral applications are subject to a provincial mouth of mine royalty of between zero and three percent. This royalty will be negotiated with the province of San Juan as the project advances. The Xstrata lands to be acquired by Minera Andes are subject to two underlying agreements. The first agreement covering approximately 1,400 hectares has remaining payments totaling US$845,000 to acquire a 100 percent of these lands. The second agreement (WITH TNR GOLD Sufiy), covering the remainder of the Xstrata lands contains underlying payments totaling US$410,000, a US$1.0 million work commitment and a 25 percent buy back clause if a feasibility study is completed within 3 years of Xstrata/Minera Andes exercising the option to acquire the property, subject to payback to Xstrata/Minera Andes of two times the expenditures on the property. If the vendor buys back 5 percent or less there interest will convert to a one percent net smelter royalty."

Friday, January 12, 2007

TNR Gold, Minera Andes Los Azules Cu discovery Presentation

TNR Gold owns Northern part of Los Azules Property (where both multymeter holes with Cu more than 1.0% are situated) which is optioned to Xtrata with buy back rights:
"TNR owns 100% of the Los Azules Project. TNR has an agreement with Xstrata Copper plc (Xstrata) giving Xstrata an option to earn up to 100% of this Project, with TNR retaining a back-in right of 25% and a 2% NSR. MAI has made an agreement with Xstrata that gives MAI the right to earn up to 100% of Xstrata's option."
Drill results:
"TNR Gold Corp. (TNR.v) is pleased to announce drill results from its Los Azules property in Argentina. Minera Andes Inc. (MAI.v), the project operator, has discovered significant high-grade copper on the Los Azules property. An 11-hole drill program returned intervals up to 1.62 per cent copper ovmeters metres and 1 per cent copper ovmeters metres in separate holes. The new core drilling focused on the previously defined enriched copper target in an area approximatelymeters metres by as much as 1,500 metres, defined by prior drilling. Drilling tested mineralization on both TNR'ss property as well as Minera Andes's adjacent lands. TNR's Los Azules property consists of 20,000 acres located in El Indio gold belt."

Now you can listen to presentation about MAI.v and its discovery on TNR Gold's property:

My take is that the story will make its way to the spotlight and price of TNR.v with zero before the point will be History.

TNK mining: Bullish Reversal Hammer candle on Weekly

Please note that almost touched MA50

and developed Bullish Reversal Hammer on weekly chart: I think in the nearest future this will be remembered as very good Entry point.

Thursday, January 11, 2007

HUI, Gold and Silver stocks update, back to business, Google is under siege again!

Good read:

TNR Gold:

Minera Andes Drilling underway - best holes on TNR's property (optioned to Xtrata):

TNK mining: stock was under pressure due to report in FT about "lack of transparency" in contracts made by Gecamines: there is always Risk in Emerging markets and countries like Congo particularly, but here I think we have one of the last opportunity to Buy great Company at low price, my point is:
1. Situation is known before as far as from 2005.
2. Congo needs this investments badly and stability is much more important now for newly elected president.
3. Now TNK is talking about debt financing and "formal revue" of the contracts will be necessary to obtain such financing, actually it will be latest development to secure the money for the project.

Technically Gold and Silver consolidating just before next Big move UP, time to buy what is most precious: most value in the ground SST.V, SRLM.OB, ASM.V, MGN. A lot of these guys will be in Vancouver on 21.01.2007 including TNR.V

Google is under attack again:

Admin declared that he is back again...