Jaguar Mining Inc (USA) (OTCMKTS:JAGGF) investors have reason to be excited given the significant improvement in financial performance and other recent developments. JAGGF has gained over 150% since the beginning of the year and has done so on impressive volume expansion which is a bullish indicator. The stock closed the day at $0.223 with a gain of 6.24%. Just a few words of excitement. JAGGF produced almost as much operating cash flow in 2015 as its current market cap. This likely won’t hold for very long as the stock gains momentum and continues its bullish advance.
In recent developments, Jaguar Mining Inc (USA) (OTCMKTS:JAGGF) released its Q4’2015 and Full Year 2015 results. Consolidated gold production of 23,169 ounces, up 3% compared to the same period in the prior year. Revenue of $26.8 million, up 4% despite a 9% decrease in the average realized gold price. It locked in a 35% improvement in consolidated cash operating costs (‘COC’) to $631 per ounce sold from $965 in Q4 2014. There was 26% improvement in consolidated all-in sustaining costs (‘AISC’) to $991 per ounce sold from $1,343 in Q4 2014. Operating cash flow of $6.8 million, up $8.0 million compared to same period prior year.
For full year JAGGF announced a 23% improvement in consolidated COC to $755 per ounce sold from $980 compared to 2014 and a 21% improvement in consolidated AISC to $1,088 per ounce sold, down from $1,378 in FY 2014, and below annual 2015 guidance of $1,100 – $1,200 per ounce sold. Revenue did decline for 2015 ending at $106.5 million compared to $116.4 million for FY 2014. Operating cash flow of $24.2 million for FY 2015, compared to negative operating cash flows of $6.8 million in FY 2014.
The company is producing massive operating cash flow which should continue as it becomes more efficienct. An even bigger benefit was the surge in gold prices. Mining companies are highly levered to the price of gold, so their profits will increase exponentially with a small change in gold prices. JAGGF recently appointed a new CEO who has over 7,000,000 shares valued at $1.61 million. In addition, he will receive another 3,000,000 shares. 1.5 million when the stock reaches $0.33 CAD and volume is sufficient. Expect this to be a resistance level as dilution occurs and another 1.5 million at $0.44 CAD.
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JAGGF is currently trading at a $28 million market valuation. Fundamentally, the company is showing signs of turning around. It is producing positive operating cash flow and if gold prices can continue to remain at this level or advance higher, JAGGF should benefit significantly. This stock reminds me of CLGRF when it traded at $0.20 level and exploded to $1.10 over the course of a year or so. Stay tuned as we will be updating with new developments.
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Disclosure: we hold no position in JAGGF either long or short at the publication of this article and we have not been compensated for this article.