Osisko Metals Overview

We have found that stocks that are being heavily purchased by their officers and directors eventually turn out to be quite profitable for investors. While large volume “insider purchases” are no guarantee of investment success, they usually are a clear indication that the performance of the company itself is the primary focus of the management. Conversely, heavy insider selling can be a signal that a company’s shares are overvalued and offer little upside. We follow the buying and selling by the officers and directors of their companies’ shares daily.

*** With the insiders (management/officers and directors) buying of the shares of Osisko Metals in such huge volume, the CEO buying 385,000 just in June, we feel comfortable in featuring it on our site. No guarantees but it certainly looks good.

The fact is that since there is very limited comprehensive research available for junior mining and exploration companies, the insider analysis is the only gauge investors have. And often, we see reactions to officers buying and selling activities within minutes of their being reported on Sedar.

Osisko Metals has a five year price range from a high of $1.70 to a low .24 cents; currently it is at .49 cents Canadian.

We are basing this report on our analysis that suggests that we are in a major bull market in base metals. That positive market view also is the opinion of other analysts and far more importantly people in the mining industry. Note that over the last fifteen months copper is up 50%, lumber over 200%, oil up 40%, silver and zinc up over 40%. They will correct down but the major trend is higher prices ahead.

During the early stage of a stock’s movement up, investors have opportunities to accumulate shares when they are overlooked and undervalued. However, extensive analysis is essential. Simply because a stock(s) is selling at prices that indicate exceptional undervaluation, it is no guarantee of success. In depth analysis is necessary!

Osisko Metals (OM)is a Canadian exploration company focused on Zinc in Canada’s two premier zinc mining regions in Canada, namely the Pine Point Camp and the Bathurst Camp. Osisko is currently drilling to confirm their resources which by the recent press releases seem to be substantial.  And unfortunately as is standard for small cap stocks and the “juniors,” comprehensive research is almost non-existent.  For this analysis we are only including Pine Point.

Osisko Metals Shares: Who owns them?

There are approximately 195 million shares outstanding of Osisko Metals with management and insiders holding approximately 38% of the shares. We also note that CEO Robert Wares has been a consistently large buyer to the point that a Canadian Insider Investment research service has mentioned it several times recently. Mr. Wares currently owns 18% of the shares and added a further 335,000 shares during the first two weeks in June. That has been reported officially as is required by law.

It is obvious from the news that there is a need that borders on ominous for addressing the repair of roads, bridges and much of the entire infrastructure of North America. For the last decade and continuing on we foresee huge ongoing repair and construction in North America which will continue for years.

 In the United States, during election campaigns politicians have been making it a primary theme. Over the last year, U.S. President Joe Biden has submitted a $3 trillion program that includes infrastructure.  While he will not get what he wants, he most likely will get $1 trillion. Suffice it to say that major government expenditures for repairs are ongoing and will increase in both the U.S. and Canada.

 At the same time, recent estimates indicated that roughly half of the bridges in the U.S. are badly in need of repair. The conclusion is that there is an unrelenting need for infrastructure repair, it is not merely a promotional “theme” gimick created by politicians or brokerage underwriters. It is based upon facts that must be addressed with hundreds of billions of dollars being spent rebuilding the roads and bridges.

Ingredients that are essential for infrastructure repair include base metals such as copper, steel and zinc. While little inflation has been frequently reported in the media, the actual facts challenge that conclusion. Simply review the commodities that would be major materials in infrastructure rebuilding.­

Why Osisko Metals?

Osisko Metals is a base metals exploration and development company focused on Zinc while controlling two of Canada’s premier zinc mining camps in Canada, namely the Pine Point and the Bathurst Camp. Osisko is currently drilling at Pine Point camps to confirm resources; we are focusing only on Pine Point.

Lack of adequate exploration in the vital resources sector has led to base metals reserve depletion. Infrastructure incentive should dramatically increase base metals demand and cause price increases. Zinc is particularly exposed to medium term supply deficits and Osisko being in two areas with potential production could put it among the ten Largest Zinc companies in the world. It is well positioned to develop one of Canada’s largest zinc projects, the Pine Point project in the North West Territories.

The Pine Point Project is located in the Northwest Territories, near infrastructure, highway access, and electrical access.     

The Osisko Metals Shares: Who owns them?

The largest positions of Osisko Metals are owned by Osisko Minerals 19% and by CEO Robert Wares 18% and large positions are held by other Osisko officers and “friendlies.” Note well that we follow the buying and selling of the officers and directors of their companies’ shares daily.

Assets in the ground per share

As you probably know, there are several methods which we use to determine the value of a mining and exploration stock. We have had some successes in the past using them. Initially, one must understand that analysis is difficult before a start-up of operations working with limited exploration results, projects, production, cash position, markets. However it may offer an opportunity….it has worked in past for us.

Step one: We are using a reasonably conservative method to determine value when information is limited.  Asset value per share based upon exploration the 5.5 billion pounds of zinc/lead for Pine Point…. 70% zinc would be 3,850,000,000 pounds. (We are using only the zinc for this.) Note that we are not including any other Osisko Metals assets which we believe could be substantial.

Step two: 5,500,000,000 (five billion) pounds of zinc/lead ……the 70% Zinc would be 3,850,000,000 pounds. If we put .10 a pound on the 3,850,000,000 billion pounds it would give it a value of $380,000,000. Note that we are giving no value whatsoever to all the other assets and future results nor what is expected in their increasing resource base.

Step three: As Zinc is selling at $1.30 per ounce, to be conservative we give a value of the in-ground 3,850,000,000 pounds ten cents per ton in value (.10) giving it a $385,000,000 gross value.

Step four: As Osisko Metals has 178,833,991 shares outstanding; we divide that into $385,000,000 ­giving Osisko a gross value of $2.16 per share in US Dollars. Our analysis suggests that at .49 cents Canadian, it could be cheap.

Final Facts, Recent Developments and comments

World’s biggest Zinc producer is China with many small mines, Canada is the fifth largest.

Base metals do not create the investment excitement and buying enthusiasm that precious metals do despite undervaluation.

Takeovers in gold stocks cover a wide range of prices over nine years, from $62 to $215 per ounce in ground, the price range for Zinc is quite moderate and not volatile.

The quality of Osisko’s Zinc is very high……

Management of Osisko has a history of success in exploration and development.