Hi All,
Misfit checking in after a long coma. I see the last time I posted was in January 2010. When I look back I think of how much has taken place since that time. To be honest I have not thought about Noront in terms of its development, news, ... in a long time. I stopped reading blog posts, posting musings, even checking their web site early this year. The only thing I do each day is look at the closing stock price while I check the value of my overall portfolio - a mix of TFSA, RRSP, and locked in RRSP trading accounts.
I sold whatever few remaining shares of Noront I had left in January for 94 cents at the time - investing in a bio company that I have been long with for a long, long time. The only stock I have followed longer would be Noront since my first buy in October 2006.
Five years. An amazing amount of ups and downs in the Noront stock price and the world-wife economy as a whole during that time. Like many I was a victim of the market crashes. I never trade on the margin so I still have most of the shares from the various companies from before the crashes but it is taking years to see any type of capital regain. This week brought the first smile in a long time as two of my favorites took major jumps.
With a lot of TFSA room in Mrs. Misfit's account, we purchased Noront today at the end of the day. I waited until the last five minutes as I expected a day trading sell off at the end. It did not happen. Two strong white candles over the past two days with a strong close both days and high volume today. What attracted my attention today was the volume. There is an incredible amount of capital sitting on the sidelines in the market these days. Almost every investor is gun shy given the shenanigans on Wall Street the past number of years. That said, the right investment will draw out the buyers. I have been a buyer this week of Noront and one other stock which I will not be accused of pumping here.
Though I have not followed Noront for over a year, I always knew that what was verified in the ground in the ROF was still quietly waiting there. In the back of my mind I knew that Noront was worth more than 50 cents but like many I was willing to wait for months or years for the economy to turn around and see the demand for nickel and copper return before holding this long. Or for the day that the coffers of a large suitor is opened up and an offer made before the economy eventually rebounds.
Recently one of my favorites which I have been watching for years (I have not owned any since 2009) was the subject of a takeover bid by Cameco. The company is similar to Noront in that for years they kept announcing incredible assays. In there case up to 80% U3O8 in parts. This Uranium company in Saskatchewan has traded from 1.40 when I first researched it and hovered anywhere between $1.80 to $2.80 throughout a number of years. Deep down I knew value was there. That amazing drill assays kept coming out of their Roughrider drilling zones. But when one once owned something at $1.40 and sells at $2.20 one is hesitent to buy at $2.80 when smoke starts to appear. With volumes increasing, the Cameco bid was announced at $3.75 in August 2011. That offer was rejected by Shareholders. On October 19, 2011 Rio Tinto made a recommended all cash offer at $4.15 a share. My believe that is still to low given what is in the ground but it is what it is. What is interesting is that the stock closed today at $4.59.
My point in that story is that there are companies out there with a lot of cash reserves waiting to pounce on an undervalued asset. We saw it happen with Freewest. It is still crazy to think how much that jumped from its trading average till Cliff's final accepted offer. I have assumed that somebody Noront would face a similar fate as Hathor and Freewest.
Today smoke has started to appear around Noront. During times of very little information being leaked or pump and dump style rumours going around, once has to wonder why 3 million shares traded and the price jumped 40% in one day (from the day low). This caught my attention so I bought at the end of the day. The worst that can come of this is that it returns to 50 cents and I wait. That combined with the loss of opportunity to buy more of my other pick that I have been accumulating the past four days.
Maybe I am a sentimental middle aged fool remembering a high school sweetie, but Noront will always be my first love. It is a stock that has been special to my family for a number of reasons since 2006. It is a story and company both my wife and I love.
It feels good to get back in today. For how long time will tell.
Wishing everyone the best in the weeks to come.
M1.
