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« Pan American Silver Corp | Main | Silver Wheaton »
Tuesday
Jul112006

Hecla Mining Company

How far can Hecla fly as silver and gold prices race for the moon?


This company is first and foremost a silver miner producing over 6 million ounces of silver last year. It also produced 140 000 plus ounces of gold in 2005 so we think it will experience a double whammy as we expect both silver and gold to make to great progress.

Hecla Mining has been around for over 100 years and is a low cost primary silver producer in North America, producing 6 million ounces of silver at an average total cash cost of $2.96 per ounce in 2005. This silver miner has a very good cash flow which is not only important from a profit stand point but it also helps fund new exploration activity. Investors dream of waking up one morning to the news that their company has just made a very important strike and Hecla could just be that company. Hecla’s exploration prospects, superb management, negible debt and solid cash position make this an excellent precious metals investment stock.

Geo-politically, Hecla is active in the United States, Mexico, Venezuela and Alaska, which is just fine by us.
Hecla’s common stock has been traded on the NYSE for approximately 40 years under the symbol “HL” In the first quarter of 2006 Hecla recorded earnings in excess of $38 million.

The chart shows that the stock has recovered from the market pull back and is just above its 200-day moving average. This presents us with an opportunity to purchase at these levels before it takes off.
As of 05 July this mining stock has a Market Capitalisation of $628 with a P/E ratio of 35 and closed at $5.27.

HeclaChart1

We think that the downside for this gold and silver mining stock is minimal compared to the upside potential, which should be very exciting in the very near future along with the rise in silver prices.

05 July 2006.

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