Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Miners on the Move: Rubicon Minerals

Don't let it get away!

Keep track of the stocks that matter to you.

Help yourself with the Fool's FREE and easy new watchlist service today.

As this long-term secular bull market for gold and silver continues to march onward and upward, major moves like this week's sudden surge in shares of Rubicon Minerals (AMEX: RBY  ) are simply bound to characterize the trend.

Rubicon's stock skyrocketed 36% Monday after the company released a long-anticipated resource estimate for the company's ultra-high-grade F2 gold deposit in Red Lake, Ontario. Compiling the results of a massive exploration drilling effort -- which began with the exciting discovery of bonanza gold grades back in mid-2008 -- Rubicon has unveiled an initial inferred resource of 4 million ounces of gold.

Significantly, that gold occurs in uncommonly high concentration within the ore body, grading at a glistening 20.1 grams per ton (0.59 ounces per ton). This renders the project's economics a no-brainer with respect to profitability across a conservative range of gold price scenarios, and in this Fool's view cements the outlook for fast-tracked mine development and construction.

A few weeks ago, I singled out Rubicon Minerals as the one stock among the holdings of the new Global X Gold Explorers ETF (NYSE: GLDX  ) that looked poised for "outsized gains that have yet to materialize." When investing in exploration companies, Fools are advised to keep track of all drilling assay results as they cross the wires, and to watch for clear instances where the market fails to adequately adjust for steady expansions of a deposit's scale. There was no magic involved in forecasting that the market would be "pleased with the scale of the deposit once revealed" ... just a whole lot of homework.

Of course, not all of my predictions regarding Rubicon have proved correct. When I scanned the mining world last year for a handful of the companies most likely to be targeted for a buyout, Rubicon topped my list. Because Rubicon's Phoenix Gold project (which includes the F2 deposit) is adjacent to Goldcorp's (NYSE: GG  ) Red Lake mining camp, I speculated that Goldcorp could not resist the opportunity to expand the scale and longevity of its mining operation there.

As it turns out, Goldcorp's acquisitive focus has instead turned to Central and South America, as with the company's brilliant moves to block rivals Barrick Gold (NYSE: ABX  ) and Newmont Mining (NYSE: NEM  ) in a pair of dramatic deals. I still cannot shake the feeling, however, that Goldcorp remains keenly aware of the opportunity staring at it from across the Red Lake camp.

One thing is clear: Despite an incredible multiyear growth spurt, Rubicon's story remains closer to its beginning than its end. The company that prepared the resource estimate for Rubicon extrapolated the data to envision a total resource potential of more than 13 million ounces of high-grade gold within the F2 system. Significant underground development has already been achieved during the exploration process, and the company is well-funded for further advancement. I encourage Fools to keep Rubicon Minerals within their sights, which can be easily accomplished by clicking here.

Fool contributor Christopher Barker can be found blogging actively and acting Foolishly within the CAPS community under the username TMFSinchiruna. He tweets. He owns shares of Global X Gold Explorers ETF and Rubicon Minerals. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (0) | Recommend This Article (31)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1384589, ~/Articles/ArticleHandler.aspx, 10/25/2016 3:22:09 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 6 hours ago Sponsored by:
DOW 18,223.03 77.32 0.43%
S&P 500 2,151.33 10.17 0.47%
NASD 5,309.83 52.43 1.00%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/24/2016 4:00 PM
ABX $16.53 Down -0.39 -2.30%
Barrick Gold CAPS Rating: ***
GG $15.29 Down -0.22 -1.42%
Goldcorp CAPS Rating: ***
GOEX $35.06 Down -0.61 -1.71%
Global X Gold Expl… CAPS Rating: ***
NEM $35.84 Down -0.51 -1.40%
Newmont Mining CAPS Rating: ***
RBYCF $0.03 Down +0.00 +0.00%
Rubicon Minerals C… CAPS Rating: **