Metal Play: Latin Metals Stock (LMS.V)

Marc Challande

Latin Metals Stock (LMS.V) has all the investors’ characteristics they want to see. Latin Metals is a mineral exploration company with a diversified gold and copper exploration assets portfolio. The company secures joint venture partners to fund drilling and advanced exploration and, in doing so, exposes shareholders to the upside of mineral discoveries while conserving capital and minimizing dilution.

latin metals stock

Big Upside with Small Exposure

Latin Metals is a resource exploration company focused on precious metals and copper projects in historically resource-rich regions of South America, specifically in Peru and Argentina. The company secured many deals recently, which will lead to significant value over time. Their asset growth is planned into two main axes, which both include three steps:

  • 1- Project Generation; Acquire Exploration Properties; Focussed Surface Exploration;
  • 2- Secure Funding Partners; Partner Funds Exploration; Latin  Metals Retain Interest.

Currently, the company is only getting revenue from the Mina Angela Project with a 1.25% royalty. However, it shouldn’t be a concern for investors as the company has already optioned projects to 6 companies, including AngloGold Ashanti, Libero Copper & Gold, and Barrick Gold. As a result, Latin Metals will receive 2.0% NSR (Net Smelter Return) from AngloGold Ashanti and 1.5% NSR from Barrick Gold.

Latin Metals has five partner-ready statuses (looking for partners) and six active explorations statuses on the extended plan. More NSR will mean more money and so more opportunities for the company.

These projects, which will take time to become successful, offer the opportunity to investors to add more shares before statuses of projects change, and will positively affect the company’s market cap/share price.

latin metals stock

The company has an excellent management board, an experienced and technically focused team that generates projects and makes recommendations for acquisitions, led by Keith Henderson (CEO), with 25 years of global experience in the resource sector. We can also highlight Robert Kopple (director), an experienced businessman, investor, and lawyer frequently buying shares on the market.

Share Structure/Fundamentals

There currently are 57,295,641 outstanding shares, for 4,605,679 warrants and 6,425,000 options that leads to only 68,326,320 fully diluted. This number is relatively low, and the Company could do more Financing to raise cash, and the fully diluted number can remain considerable. The last private placement happened on October 8th to raise $1.3M through the issuance of 8,666,667 units in the capital of the Company (each a “Unit”) at a subscription price of $0.15 per Unit and one-half of one common share purchase warrant, with each whole warrant entitling the holder thereof to purchase one share for $0.25 per share for 24 months from the closing of the Financing. Robert Kopple (Director) bought CA$554k worth of the stock.

On the ownership side, the Company has great numbers:

  • Management & Board : 47%;
  • Core Investor Group: 15%;
  • Float: 38%.

Investors consider that 20% for insiders ownership is already significant data. Having 47% shows how healthy the Company is. We will have more considerable variations with a float of only 38%, meaning only 21.7M shares for retailers.

Insiders keep on buying shares on the market with no selling. In the last three months, seven buying occurred, all done by Robert Kopple. We totalize 18 buying orders for no selling done by insiders during the previous 12 months.

Share Movement

The stock is traded at $0.12 for a current low market cap of $6.8M. Investors saw a 52-week high of $0.185 (April 19th, 2021) and a 52-week low of $0.10 (December 1st, 2021). The stock found its support at the 52-weeks low because it reached these levels three times without breaking down and is now up by 20% from its support. The share movement still has a downtrend, and the moving averages attest to it. With a Simple MA (200) at $0.14 and a Simple MA (20) at $0.13, we will have to wait and see the short-term average cross up to an uptrend. The Bollinger bands indicate that we can see daily fluctuations between $0.11 and $0.16. This is why adding shares at these prices seem pretty reasonable. The last data we can look at is the RSI (Relative Strenght Index). With an RSI of 44, the stock isn’t in overbought or oversold territory (above 70 or under 30), meaning there won’t be sudden movements.

The volume is currently pretty low compared to what we could have seen before. For example, the 10-day ADV is at 12k shares traded when the 20-day ADV is at 20k and the 50-day ADV at 13k. On Friday, March 4th, there even were only 2.3k shares traded! Uncertainties worldwide led to a decrease in volume on junior exchanges, and the low volume on LMS could slacken the price action.

latin metals stock

For now, investors are trying to add many shares at these prices and aren’t willing to buy on the market; estimating the share price shouldn’t go up in the short term. However, there are no significant walls on the ask side, meaning the stock can quickly go up with volume and news.

Bottom Line

The company gathers all the characteristics of a hidden gem. As proof, Quants Report gives Latin Metals stock a fair valuation of $0.24 or a 100% direct upside and a 3/5 star rating. Yahoo Finance is even more optimistic with a 1-year target of $0.37, leading to a 300% growth potential! The company has an excellent structure with less than 60M shares outstanding (and less than 70M shares fully diluted) with a high percentage held by insiders. It will be interesting to see where the company be at in the long term. The company definitely deserves to have more eyes on it, and this is why you should add LMS to your watchlist. Keep an eye on it, and once volume starts picking up, it will be a good time to add the company to your portfolio.

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