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Yukon-Nevada Gold Corp - The Train Is Leaving the Station But a Few Seats Remain

February 07, 2012 | About:
Many people who are aware of Yukon-Nevada Gold Corporation (YNGFF) know that I have written about this company extensively. You can read my report, The Drama is About to End, for background information. Yesterday, the company announced pivotal news that I have been looking forward to for more than half a year: The winterization of the mill has been completed and gold production has been restarted at Jerritt Canyon. The stock was up 20 percent on the news and nearly 4 million shares traded compared to the average daily trading volume of less than 1 million.

The forecast annual production rate is 108,000 ounces of gold for February 2012 and 150,000 ounces of gold for March 2012. With a gold production rate of 150,000 ounces of gold, the company should cash flow in the neighborhood of $150 million per year. Even after the run up in price, the market cap is still only slightly more than $300 million.

Considering that the company is planning on expanding production to 300,000 ounces of gold in a couple of years, I would not be surprised if Yukon-Nevada becomes a four-bagger before 2012 is over. Throughout the year, there are several catalysts likely to drive the stock price higher. For example, a new 43-101 is expected to be released showing additional resources. Also, the management is seeking a listing on AMEX.

Disclosure: The author owns shares of Yukon-Nevada Gold Corporation.

About the author:

Mariusz Skonieczny is the founder and president of Classic Value Investors, LLC, an investment management firms that builds and manages customized investment portfolios for its clients. He is the author of Why Are we So Clueless about the Stock Market? Learn How to Invest Your Money, How to Pick Stocks, and How to Make Money in the Stock Market. Email: mskonieczny [at] classicvalueinvestors [dot] com. Webpage: www.classicvalueinvestors.com

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