Over the last year and a half we have seen a downturn in the markets due to the overhang of covid, the war in Ukraine, inflation and questionable banking practices. Although prices of gold and other metals have held up relative to the overall market, the downturn in the larger markets have had an overall negative effect on Junior mining companies. This in-house market analysis aims to compare New Age Metals share price to its peers and the Toronto Stock Exchange Venture index. It is important that shareholders, new investors and investors in general understand the potential upside behind a downturn. A downturn can in fact be an opportunity to acquire stocks at a discount. Looking back at history, most declining markets have been buying opportunities. This in-house analysis of the junior market is not financial advice and should not be used to make financial decisions. We encourage everyone to discuss financial matters with their financial advisors.
New Age Metals Chart
We begin by examining the NAM stock chart from April 12th 2022 to April 12th 2023.
The stock has decreased in value from a yearly high of $0.13 to a current (April 12th, 2023) price of $0.6. This was a decrease of ~53.85%.
TSX Venture Chart
We now shift our attention to a chart of S&P/TSX Venture Composite Index from April 12th 2022 to April 12th 2023. The S&P/TSX Venture Composite Index is the main index for the TSX Venture Exchange, which tracks the performance of Junior mining companies listed on the exchange. Although the index includes all sectors, the TSXV is primarily resource focused with the majority of listings being exploration and development stage Junior miners. Although we believe the downturn for the Juniors started in February 2021, for the simplicity of this analysis we will be looking at the 1 year chart.
A similar trend is seen between the overall index chart and New Age Metals chart with similarities in price changes. A sharp decrease between April 2022 and July 2022 which was followed by a short rally from mid July till mid August 2022.
Below are charts of NAM’s peers. These companies have similar commodities to New Age Metals such as Platinum Group Metals and Lithium.
Grid Metals
Grid Metals has a yearly high of $0.23 and is now trading at $0.14, meaning their share price has decreased by ~39%. Grid is similar to NAM in the sense it has diversified critical metals projects; lithium, PGMs, nickel.
Palladium One
Palladium One has a yearly high of $0.25 cents and is currently trading at $0.105 cents, a ~58% decrease.
Nickel Creek Platinum
A PGM and Nickel exploration development company in Canada. The price had a year high of $0.10 and is currently trading at ~$0.05, an ~ decrease of 50%.
ACME Lithium
A Lithium exploration company focused in Manitoba and Nevada. The stock had a year high of $1.30 and is currently trading at ~$0.445, a decrease of ~65%.
Generation Mining
A Feasibility Stage large PGM and base metal company working towards productions. The stock had a year high of ~$1.10 and is currently trading at $0.56, a decrease of ~49%.
Clean Air Metals
A PEA stage PGM exploration and development company focused on Canadian projects. The stock had a year high of $0.30 and is currently trading at $0.065, a decrease of ~78%.
Snowlake Lithium
A lithium company focused on exploring and developing projects in Northern Manitoba. Snowlake traded as high as $6 in the last year and is currently trading at $2. This is a decrease of ~66.7%.
All the charts illustrated above belong to our peer companies which deal with similar commodities and are all at the exploration/development stage. All graphs are almost exactly the same and suggest that the Junior mining industry is in a downturn. We did not go out of our way to find near identical graphs. This simply is the way the Junior industry is at this time.
Conclusion
In conclusion, it is evident that the market as a whole is in a downturn. Economic cycles are cyclical and expected however and obviously are worrisome for all investors. Based on historical economic data, more often than not, a boom follows a downturn and investors that capitalize on building positions during a downturn enjoy the profits of the up market. If a given investor bought shares in New Age Metals because they were looking for Lithium and/or PGM exposure, it is important to remember that due to the downturn the price of New Age Metals shares may not reflect the progress the Company continues to make on its projects. A Company that continues to develop its projects, maintains healthy financial statements and survives a tough economic climate may be primed to thrive in a boom market.
Time in the market beats timing the market; a simple strategy that enriches the patient investors.
The Junior mining industry is a risky business however the downside of a market should typically be the best time to become a shareholder, average down on your existing position and add to your overall positions. New Age Management along with all of our technical advisors have been hard at work developing both our Manitoba Lithium Projects and our advanced stage Palladium Project. Our Lithium Joint Venture partner, one of the world’s largest lithium producers, continues to approve larger budgets to expand our exploration activities. The corporate office ensures that all progress is communicated to shareholders and interested parties via press releases and monthly Chairman Newsletters. We continue to encourage interested parties to email us at info@newagemetals.com or to phone the office at 613 659 2773 to have any of your questions answered.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. Cautionary Note Regarding Forward Looking Statements: This release contains forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results and are based on current expectations or beliefs. For this purpose, statements of historical fact may be deemed to be forward-looking statements. In addition, forward-looking statements include statements in which the Company uses words such as “continue”, “efforts”, “expect”, “believe”, “anticipate”, “confident”, “intend”, “strategy”, “plan”, “will”, “estimate”, “project”, “goal”, “target”, “prospects”, “optimistic” or similar expressions. These statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, among others, the Company’s ability and continuation of efforts to timely and completely make available adequate current public information, additional or different regulatory and legal requirements and restrictions that may be imposed, and other factors as may be discussed in the documents filed by the Company on SEDAR (www.sedar.com), including the most recent reports that identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. The Company does not undertake any obligation to review or confirm analysts’ expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Investors should not place undue reliance on forward-looking statements.