ASM - Avino Silver and Gold mines ltd

[kai99]

Hi people,

What do you guys think of ASM

http://finviz.com/quote.ashx?t=ASM&b=1

Canadian miner with little debt, 0.44 cash per share.

One of those hammered down miners, looking at a consolidation now. Some good news coming out of it as well with positive developments.

Only problem is low free cash flow.

Please educate and share your thoughts on this!

[ItsAValueTrap]

Possibly a short.

Only problem is low free cash flow.

If their mining assets (the ones that are currently producing and are fully built) aren't throwing off cash flow, then they probably aren't worth much.

Secondly, their G&A seems really high.  (This could very well be your typical junior mining BS where insiders make money *from* shareholders.)  This is really bad for shareholders.

Umm... I would stay away from mining.  Once you spend the time to understand it, you realize that mining is mostly a waste of time right now.  If you want to short, pharma and oil&gas are better.  If you want to go long, almost any other industry is better.

[kai99]

Possibly a short.

Only problem is low free cash flow.

If their mining assets (the ones that are currently producing and are fully built) aren't throwing off cash flow, then they probably aren't worth much.

Secondly, their G&A seems really high.  (This could very well be your typical junior mining BS where insiders make money *from* shareholders.)  This is really bad for shareholders.

Umm... I would stay away from mining.  Once you spend the time to understand it, you realize that mining is mostly a waste of time right now.  If you want to short, pharma and oil&gas are better.  If you want to go long, almost any other industry is better.

Hi it'savaluetrap, many thanks for your advice. How would you describe where insiders make money off the shareholders with high G&A?

Also why won't it be wise to go along with the mining cycle this time. Thx!

[ItsAValueTrap]

You can lead a lavish lifestyle and bill it to the company.  That will result in excessive G&A.  Sometimes the company's filings on SEDAR will show how much it spent on travel, entertainment, etc.

Other things will also result in excessive G&A.  If the company is spending lots of money on stock promotion, then it will show up in G&A.

2- The problem with mining stocks is that:
A- Many are overvalued.
B- The majority are run by a (part-time) CEO who is trying to enrich him/herself at the expense of shareholders.
C- Almost everybody is inflating their technical reports.
D- Some management teams choose to do crazy things.

A longer post on what I think about mining:
http://wp.me/p1mOGr-BZ