Source: Streetwise Reports 02/09/2023
Chris Andrew of Clarmond Securities sat down with Streetwise Reports to tell us about his company and what some of his top picks are for 2023.
Clarmond Securities is a wealth management and investment advisory firm that manages US$100 million and takes clients all around the world, though they take a boutique approach and focus on tailoring their investment to what will work best for each of their clients.
“I think if you get the right management team and the right people, you can get a really great performance. And you can really get five to ten times your money.”
Its managing director Chris Andrew spent 14 years in the investment world before founding Clarmond and prides himself on increasing value for his clients.
In terms of investment types, Andrew told Streetwise the majority of his investments include ETFs. He commented, “Invest through ETFs, and funds and collectives because it takes all the hassle out of it. But then this edge, this edge of the portfolio, with commodities, I like to play in small companies because I think if you get the right management team and the right people, you can get a really great performance. And you can really get five to ten times your money.”
Because of this, we wanted to reach out and speak with him about which individual companies, Andrew believes are set up to succeed.
Stocks Set Up for Success
Andrew went on to speak about how commodity stocks can be beneficial even when the economy isn’t looking too good.
He said, “The markets been terrible for the last past two or three years, and commodity companies have been chucked in the bin, and small-cap commodity companies even more so. Yet, this is great. Because obviously now you can make your fortunes in or you can build your fortunes in.” He said, with the market the way it is, it could be a time to get positions, which he believes are set up nicely for when things turn around.
Slave Lake Zinc
One of these positions is Slave Lake Zinc Corp. (SLZ:CSE). Slave Lake is a Canadian mining corporation named after the lake near its largest claim in northern Canada.
“I like it because it’s cheap,” Andrew said. “It’s gone very cheap, like a lot of these Canadians, and I really liked the management because, to me, management is everything.” Speaking of management, Andrew was particularly impressed by how methodical and unrushed the team was in setting up this project.
“What I really liked about it,” he said, “was that they’ve taken a lot of time to get to this position and this place, and they haven’t rushed it.”
Andrew was also impressed by the company’s relationship with Northwest Territory Métis Nation (NWTMN). He said, “That’s a really powerful thing to have because, once you’re on the inside there, everything becomes a lot easier.” Overall, collaborating with local indigenous people aids in moving a project forward without resistance. It’s also mutually beneficial. According to the company, “It has benefits for economic advancement and first right of refusal for employment opportunities and educational and training advancement for the members of the Northwest Territory Métis Nation first and the people of the South Slave second.”
Slave Lake also has a myriad of resources at its disposal. “It’s not just zinc,” Andrew said. “It’s copper; it’s lead; it’s silver; it’s gold. By the sound of it, you scratch the surface up there, and you can find another mineral. So that’s also amazing. So it just looked geologically like a very interesting area, on top of a really good team . . . what’s not to like?”
Finally, Andrew made a point to reiterate the cost of the stock. “It’s relatively cheap, and it’s well managed, so there’s a good chance that if they execute their plan, then you’ve got a really great asset here that they’re going to bring forward.”
According to Reuters, 38.11% of Slave Lake’s stock is owned by management and insiders. Director and CEO Ritch Wingham has 9.32%, with 4.80 million shares. Director Glen MacDonald has 9.28%, with 4.78 million. President Jaskarn Singh Rai has 9.16%, with 4.72 million. Director Brandon Maxwell has 8.75%, with 4.51 million shares, and CFO Peter Cummings has 1.61%, with 0.83 million.
61.89% is in retail.
Slave Lake has a market cap of US$4.41 million and trades in the 52-week range between CA$0.05 and CA$0.195.
Another position Andrew spoke highly about was Royal Helium Ltd. (RHC:TSX.V; RHCCF:OTCQB). Royal Helium is a Canadian helium exploration and development company. The company primarily focuses on primary helium in southern Saskatchewan and Alberta. Currently, Royal Helium holds the place as one of the largest helium leaseholders in Canada, which is one of the reasons it piqued Andrew’s interest.
Originally, Andrew invested in Imperial Helium In 2021, after Imperial fell into financial difficulties, it was acquired by Royal Helium.
Like Slave Lake, Andrew found himself impressed by Royal Helium’s management team. He said, “That’s why I like Canada because the management teams in Canada have been around the block along many times, they’ve seen many cycles, so they know what they’re doing.”
Andrew also commented on the current helium market. Current global demand for helium “is estimated at around 6 billion cubic feet (Bcf) or 170 million cubic meters,” according to Money Week.
Cliff Cain, CEO of rare gas consultancy commented saying, “Demand keeps growing though, mainly from the medical, tech, and aerospace sectors, and “it will keep growing.”
Andrew conquered this in our meeting and said, “People are going to need this helium.”
In August, Royal Helium announced that it has entered into a long-term agreement with a major North American space launch company for the supply of helium. Initial deliveries under the supply agreement will commence in 2023.
While Andrew does not know for certain who this company is, he has his guesses. He said it could only be one of three companies: Nasa, Virgin Galatic, or Space X. His number one pick is Space X. Andrew noted, “I’d be most delighted if it was Space X because that seems to have a bit more momentum with it.”
Andrew overall believes in Helium’s opportunity. He ended by saying, “It’s going to steadily grow. It’s good. It’s going to be the main helium play for you know, for years to come.”
According to Reuters, 4.59% of the company’s stock is held by management and insiders. Top shareholders include director Samuel “Kyler” Hardy, who has 2.28%, with 5.45 million shares. President and CEO Andrew Davidson has 0.87%, with 2.08 million shares, and CFO Jeff Sheppard has 0.62%, with 1.48 million shares. 60% is institutionally held. The remainder is retail investors.
Royal Helium has a market cap of CA$79.72 million and trades in the 52-week range between CA$0.20 and CA$0.52.
Soperior Fertilizer Corp.
Last, Andrew spoke about Soperior Fertilizer Corp. (SOP.H; TSX). Soperior is an exploration and development company, and a near-term producer of SOP (sulfate of potash) fertilizer, alumina, and sulphuric acid from its massive Blawn Mountain Alunite resource asset in Utah.
Andrew said, “Soperior fertilizer is exactly what it says [superior]. They have this gigantic asset called Blawn mountain, which seems to be a lump of potash, as far as I can tell, and potash is very valuable.”
The company added, “Blawn Mountain has a massive alunite reserve which you can with one simple process make high-value potassium sulfate fertilizer, alumina — to make aluminum, and sulfuric acid which is in high demand domestically for mineral processing, so three highly valuable products from one operation.”
He noted that Soperior had a bit of bad luck in the past, with the untimely death of its BOD Chairman. However, Andrew believes the new CEO, Andrew Squires, could bring the company a lot of success.
According to Andrew, Squires has been attempting to raise money and develop this for the past couple of years. So far, Andrew noted, the company doesn’t have the infrastructure it needs. However, he sees promise on the horizon.
The company is in the process of closing a joint venture agreement with an unnamed strategic partner to get a first-phase production facility financed and constructed. The deal here is that the group is purchasing 50% ownership in the asset and can earn up to an additional 35% working interest in the project by financing and building it. That first phase could cost up to US$400 million or more to get into production and Soperior would own 15% of it.
Andrew said, “What we know is that they’ve got a joint venture with an unnamed group and I can’t get at the group as much as I’d like to but it’s got a lot of money.”
Andrew noted that the company has been working on this JV deal for over a year with this counterparty. He said, “We’ve been on the verge of having a deal for the last year for two or three years. I think we are finally now on the budget with this group. Recent global events underpin how critical it is for the U.S. to develop domestic supply sources for strategic and vital mineral resources and this project makes three of them.”
Andrew also stated that when it comes to recommending the above stocks, “I tried to have a little bit of each of them and all my client portfolios, but Soperier could be the one that budget moves first like really moves first.”
According to Reuters, 0.12% of the company’s stock is held by management, with CEO Andrew Squires owning the entire 0.12%, with 0.32 million shares.
The rest is in retail.
As the market moves, so will Andrew. While he cannot say exactly where it will take him, he does know that his picks will always be centered around Clarmond’s philosophy.
In the words of the company, “The landscape of investment and business has changed radically over the last 20 years; the next 20 years will likely have even greater change. Clarmond will remain alert to these movements and will endeavor to stay one step ahead of the marketplace.”
1) Katherine DeGilio wrote this article for Streetwise Reports LLC. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with: Slave Lake Zinc Corp. Please click here for more information.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Slave Lake Zinc Corp. and Royal Helium Ltd., and Soperior Fertilizer Corp., companies mentioned in this article.
( Companies Mentioned: RHC:TSX.V; RHCCF:OTCQB,