Finding Opportunity in Advanced Discoveries | Goliath Resources (TSXV: GOT)

Reader JP sent me this question (edited slightly to shorten):

One of the main goals is to determine if a deposit is economically viable but this is pretty hard to do with a junior exploration company b/c general investors don’t readily have access to capital, operating, and reclamation costs, especially if only a maiden resource estimate exists or no estimate has been determined to date.

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I also want to provide a sneak peek at my conclusion, which is that I’m buying Goliath Resources (TSXV: GOT). I used this exercise – explaining how I decide whether I want to buy a stock with an advanced discovery – to assess Goliath. The timing was ideal: I had been meaning to put GOT through the paces over the last two weeks because I knew the company was going to announce a financing and I needed to decide whether to invest. I saw news of that financing this morning, just as I got to the part of this article where I wanted to demonstrate my process with a real example.

So I assessed Goliath today and wrote about it. The process led me to believe GOT is undervalued relative to the resource they will likely deliver after this summer’s drill program, for reasons I outline. There is also a real chance GOT could drill into a second discovery at the Golddigger project when they test a target 4 km away on strike from the main discovery that looks very similar.

OK – with the disclaimer and sneak peek done, let’s dive in….