Pick of the Junior Mining Stocks – Two Low Price/Cash Flow Mining Buys

Article Excerpt

AMERIGO RESOURCES $2.54 (Toronto symbol ARG; SI Rating: Speculative) (604-681-2802; www.amerigoresources.com; Shares outstanding: 94.4 million; Market cap: $239.7 million) has a contract with Codelco, Chile’s state-owned copper producer, to process the tailings from El Teniente, the world’s largest underground copper mine. Tailings are the waste rock produced in the mining process. The contract runs at least through 2021. Amerigo has a further agreement with Codelco to process a supplementary source of material from the nearby Colihues tailings pond. Amerigo also holds 13.2% of TSX-listed Candente Resource Corp. with a market value of $16.6 million. Candente explores for copper, gold and silver in Peru and Mexico. In the three months ended September 30, 2007, Amerigo’s revenues rose 44.6%, to $28.5 million from $19.7 million. (All figures except share price in U.S. dollars.) Earnings fell 20.2%, to $6.6 million or $0.07 a share from $8.3 million or $0.09. Cash flow per share fell 16.7%, to $0.09 a share from $0.10. Earnings and cash flow…