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August 5, 2009 / Jeb

Morning Stock Pick (NGD) New Gold Major Breakout Anticipated, Lowering Costs, Expanding Cash Flow

Very few gold companies have the cash flow that is beneficial to shareholders like New Gold.  Many companies have attractive projects but they do not have the cash flow that would be able to develop them without diluting shareholders.

They have two major development projects.  New Afton and El Morro has exposure to both copper and gold which I like as global economies are recovering.  They have three producing mines which are providing cash flow to prevent dilution to shareholders.  This year they will be producing 350,000 ounces of gold as well as copper and silver.

This stock is extremely undervalued for the properties and potential it has.  They hope to produce 1 million ounces of gold by 2012.  I believe this stock is very close to another breakout.

I recommended and bought NGD at 2.50 and am still adding on any high volume breakouts.  That is a 22% move.

NGDI am looking at a breakout at 3.10 on high volume to add to my position.

Disclosure: My family and I own New Gold shares.



Leave a Comment
  1. Ticker Street / Aug 6 2009 8:49 pm

    What about EGO?

    • Anticipate Opportunities / Aug 6 2009 9:09 pm

      It is a very choppy chart pattern…I look for smooth bases.

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