Wolverton picks seven top gold juniors

As the rally in gold stocks percolates downwards into smaller and smaller companies, analysts such as Tracy Hurley of Wolverton Securities are examining microcap gold stocks and recommending those that seem worthy of attention.

In a recent Stockhound Report, Hurley notes that “our biggest problem was keeping companies on the list, as we saw some of our favourites quickly exceed limits we had set on market cap and price gains since last December.”

She recommends seven companies, all of which share the same attributes: strong technical management; good projects with active or upcoming work programs; sufficient working capital; and a market cap below $15 million.

She adds that the group has experienced less price appreciation than their peers in recent times, owing to lower profiles and less investor awareness.

Wolverton considers the assembled group, listed in alphabetical order, to be “speculative buys for agressive investors only.”

– Eastmain Resources (ER-T) gets the nod for its portfolio of gold, base metal and diamond prospects in eastern and central Canada, in particular the Clearwater high-grade gold project in Quebec.

Eastmain and equal-partner Soquem are planning a $1.3-million exploration program at Clearwater beginning in June, and Eastmain has an option to acquire half of Soquem’s stake in the project.

– Hurley approves of Energold Mining (EGD-V), both for its land holdings in the Dominican Republic and its half-stake in portable-drill-rig manufacturer Kluane International Drilling.

In the Dr, Energold and subsidiary, impact minerals, have claims close to Placer Dome‘s (PDG-T) new pueblo viejo gold-silver project.

Hurley comments that “with only a $3.3-million market capitaliztion (including $1.2 million in working capital), and ownership in a profitable drilling company, Energold continues to be one of the most undervalued exploration companies we follow.”

– First Au Strategies (FAV-V) is included for its optioning of Rimfire Minerals‘ (RFM-V) Thorn copper-gold-silver property in northern British Columbia. First Au will spend $300,000 drilling the property this summer.

The junior will also soon be mounting a minimum $250,000 exploration program at the Casummit Lake gold property in the Birch-Uchi greenstone belt in northwestern Ontario, next to the prolific Red Lake greenstone belt. First Au has an option to acquire a 51% interest in Casummit from Wolfden Resources (ywo-v).

– Fronteer Development (FRG-V) gets a thumbs-up from Hurley for carrying out an aggressive land acquisition in the Birch-Uchi belt, and subsequently optioning several claims to joint-venture partners such as Glenhaven Ventures (GHM-V) and Australia’s Auriongold (currently the subject of a takeover bid by Placer Dome).

Formerly a real-estate company, Fronteer is now considered by Hurley to be a “serious junior explorer with excellent technical expertise and a promising project area.”

– Wolverton continues to like Nevada Pacific Gold (NPG-V) for its growing portfolio of gold projects in Nevada. Work is ongoing at four of these projects, including Limousine Butte, which is optioned to Newmont Mining (NEM-N), and South Carlin, optioned to Placer Dome.

Hurley heartily approves of the addition of former Eldorado Gold (ELD-T) President Richard Barclay as Nevada Pacific CEO and director.

She concludes that the company is “well-positioned to gain from further appreciation in the price of gold and much more so should current drill programs meet with success.”

– Radius Explorations (RDU-V) remains a favourite of Hurley’s, who says “we have not changed our view of Radius as a premier gold explorer, holding a very large land position in an unexplored and promising area of Guatemala.”

South African giant Gold Fields (GOLD-Q) is drill-testing targets on joint-ventured Radius properties in Guatemala, and the junior continues to explore its own, wholly owned properties in the country.

– Also on the list is Rimfire Minerals (RFM-V). Says Hurley: “We are maintaining our recommendation of Rimfire as a top-notch generative explorer.”She adds that the company has maintained its business plan of generating projects with large potential and attracting partners to finance their advancement.

Rimfire recently acquired the Adam porphyry copper-moly-gold property in British Columbia, some 25 km southwest of the Eskay Creek mine. The junior is now seeking funds to begin reconnaissance work.