The Big Fish That Got Away: Silver Standard

Who says you can’t make money in these markets? Silver Standard Resources (SSRI) provides us with one great example.

Silver Standard like virtually all stocks took a terrible beating in the recent market sell off touching an intra-day low of $5.35 on October 27th. Have you looked lately? Wow, SSRI has rocketed up to $20. Even though our specialty is warrants, SSRI was on our radar screen and at a resource conference last October in Toronto we suggested since SSRI did not have any long-term warrants trading that investors should look at the LEAPS available.

Let’s examine Silver Standard a little closer. They have the largest published in-ground silver resource of any publicly-traded silver company, with a pipeline of projects in Argentina, Peru, Mexico, Canada, Chile, the United States and Australia. As a development stage company they have a portfolio of silver-dominant projects located in seven countries in the Americas and Australia and they are currently developing the Pirquitas property that is located in the province of Jujuy in northwest Argentina.

Their financial statements as of September 30, 2008 reflect a cash balance of $103 million. Interestingly SSRI also holds shares or warrants in several companies including Aurcana Corporation another one of our favorites.

The common stock is quoted on the Nasdaq Global Market under the trading symbol SSRI and listed on the Toronto Stock Exchange under the symbol SSO.

The chart speaks for itself. Speculative investors could have purchased the shares or LEAPS on the plunge in October while more conservative investors should have been buying as the shares crossed to the up-side the 50 Day MA in early December around $10. While SSRI still has a lot more upside potential we would be now be inclined to wait for a pullback to around the $15 range. While SSRI does not have any long-term warrants trading there are many other companies which do and we encourage you to visit our website.