Honey Badger Silver (TUF.V) Pulls No Punches

A silver stone.

When you think of junior mining companies, what comes to mind? A small business exploring and waiting for their big discovery before finally starting production? Maybe an organization without large capital commitments, land, or other assets? This might be true of most junior miners but is so far from the mark for Honey Badger Silver, that one has to wonder why they are even considered ‘junior’ in the first place.

Honey Badger has shown it can produce year after year and judging by their financial reporting since 2018, you can get the idea that they know where to focus their efforts. The Canadian company has created a strategy centred around a large mine in the Historical Thunder Bay Silver District in Ontario, Canada. Their land position of 16,800 hectares in the region is the dominant one and allows them to take advantage of some of the most productive silver-bearing veins of the Rabbit Mountain group of deposits. Nothing is holding the company back, and competition is thin, to say the least. 

Full Speed Ahead

The investment comes with the added benefit of funding an expansion of the exploration of the company’s Thunder Bay silver portfolio and for general working capital purchases. Production increases should follow as well, returning the investment to Sprott’s pocket as well as anyone who is wise enough to jump in with him. 

Investors Agree

Beyond management holdings and those buying shares piece by piece, high-profile investor Eric Sprott is also all-in on Honey Badger Silver. A new placement from the investor going all-in on junior mining companies of $1 million is the ultimate vote of confidence from an investor who knows exactly what he’s doing. Investors buying shares now can only be learning from the smart money now and will be able to reap the rewards down the line when it continues to rise.

Making Room

Sprott’s decision to add $1 million to a $3 million placement prompted Honey Badger Silver’s chairman Chad Williams to voluntarily reduce his subscription to the stock, according to him, to, “accommodate high demand from other investors”. He now holds 9.9% of the company, undiluted. 

In Good Company

Honey Badger Silver is in good company when it comes to those chosen to be a part of Sprott’s investment portfolio. Going beyond institutions, he placed his faith in another top miner last year, First Majestic Silver. The investment was for 5 million shares worth $78 million, proving that when you know the answer, your portfolio will surely follow. 

Buying Up Property

Honey Badger isn’t slowing down, as made evident by their March 15th announcement that they have acquired three advanced silver-focused properties located in southeast and south-central Yukon, Canada. The acquisition will help the company diversify its property portfolio and begin producing in multiple regions of the country. The expectation is that the acquisition will close on or before April 30, proving that the company is ready to continue its expansion and put its capital to good use. 

Looking Down The Road

Looking into the future is impossible, but forecasts are made a lot easier by extrapolating from current trends. Let’s take a look at how it’s going so far. The stock has touched all-time highs, acquisitions are en route, and the company is well-capitalized to continue its production and expansion. If the trends of the past few years continue, Honey Badger stock is only at the bottom of a very long upward trend, and even shareholders with relatively small stakes stand to benefit from any more wins. 

Although the company is a junior miner in name, it operates like a seasoned and much bigger player, controlling and exploring 100% of one of the most valuable silver properties in the country (and the world). Clearly that isn’t enough for Honey Badger Silver, who we will continue to follow closely.  

By Matthew Evanoff

I cover the mining industry and the best mining stocks around the world. I write about industry news, individual companies, projects, management, and profiles on industry leaders.

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