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A Gold Stock Doug Casey Owns, Now 36% Below What He Paid

Experts Roundtable Oct 8, 2026 1:24:24

Summary

Reopening the McCabe mine through its ventilation raise cuts planned drilling costs about 95% — 60 holes for $200,000 instead of $9.6 million from surface.

Arizona Eagle Mining's historic estimate is about 887,000 ounces at 11.7 g/t (grams per tonne), and lower modern cut-off grades should expand it.

CEO Kevin Reid says C$5.5 million in cash covers the US$3.7 million underground re-entry budget, with drilling guided for May or June.

Phase 1 surface drilling hit two economic intersections in seven wildcat holes, including a zinc-rich VMS (volcanogenic massive sulfide) copper discovery.

The panel flags narrow veins, illiquidity and tax-loss season as near-term risks, while insiders hold roughly half the company.

Key points on Barrick Mining

  • The CEO cites Barrick alongside Equinox as an example of majors buying at the top of the copper market, the pattern he says led BHP to buy Magma Copper and close this mine.

Key points on Equinox Gold

  • The CEO groups Equinox with Barrick as buyers who paid top-of-cycle prices, drawing the parallel to BHP's $3.1 billion takeover of Magma Copper at the peak of the copper market.

Steve Hyland's takeaways

  • Top takeaway Frames the macro backdrop: gold was over $4,700 at the last roundtable (published April 27, 2026) and sits below $4,200 now, which he argues matters for judging the story.
  • Draws out why underground drilling is cheaper: targets sit about 800-1,000 feet closer so holes cost roughly $100 per meter versus $400 from surface, and he hears the company plans to buy its own $35,000 drill rather than contract drilling.

Lawrence Roulston's takeaways

  • Top takeaway Presses for hard timelines on getting a drill turning underground; hears May-June as the guidance, possibly sooner if the flooded workings are in good shape.
  • Asks when the work could support a mineral resource estimate or mine plan and about dewatering inflow; hears about 10 days to dewater with a pump and that the 6.8 g/t historic cutoff means widths, and the estimate, could be roughly a third of the potential.

Brent Cook's takeaways

  • Top takeaway Tests execution risk directly, asking whether the drills will actually turn underground and whether the CEO has done this before, establishing the schedule (engineering complete January, groundbreaking February, drilling guided May-June) and the $5.5 million CAD treasury against the $3.7 million budget.
  • Flags the narrow-vein problem, noting the company's own slide shows a roughly 75-inch high-grade zone and citing the Stan West failure, and asks what mining width survives dilution; hears the 1980s mine ran about 3.2 feet at an 11.7 g/t recovered grade.
  • Draws out that lowering the 1984-era 6.8 g/t cutoff could bring two to three times more gold into the envelope at wider widths, which management frames as upside to be proven by drilling.

Doug Casey's takeaways

  • Top takeaway Reveals he took the $1.10 private placement with half-warrants, is sitting on a loss, and hasn't sold a share, saying he buys the potential and the story and doesn't think the stock will stay down for long.
  • Says he is 'kind of a happy camper, all things considered,' keeping the position through the drawdown rather than cutting the loss.

Dominic Frisby's takeaways

  • Top takeaway Calls Arizona Eagle probably his worst investment and one of his worst calls of 2026: he bought around $0.20-0.30 after the June presentation, the stock ran to about $0.80, then an upsized placement at $0.10 with $1.50 warrants led holders to dump into it, and the stock fell to about $0.45.
  • Challenges management's credibility, saying Kevin had stated about a week before the discounted, upsized raise that the company had enough money to execute, and demands an explanation for the reversal.
  • Says that in June he thought the stock could easily run to $3-5 given its unique situation, but argues the roughly four to five million $1.50 warrants will cap the share price in a stock this illiquid.

Kevin Reid's takeaways

  • Top takeaway Unveils the pivot: re-enter the mine through the ventilation raise instead of the production shaft, cutting drill cost for 60 targets from $9.6 million from surface to about $200,000 and completion from 8.5 months to about a month.
  • Argues the roughly C$35 million market cap pays nothing for about US$50 million of existing infrastructure, a 14-foot concrete-lined shaft to 1,650 feet, about 5 km of workings, and a ventilation raise, calling it about a 50% discount to replacement cost.
  • Stresses alignment: he, his brother, and the chairman put in about $2 million each and hold roughly 50% of the company, and he says insiders bought about 300,000 shares in the six weeks before the call.
  • Defends the discounted, upsized financing to Dominic Frisby as a board decision taken amid market volatility, saying he won't operate in the rear-view mirror and that capital should flow to the lowest-cost driller into the highest-grade deposit.
  • Lays out the drill plan: start at the 830-foot level, then step to the Adventure system about 600 feet south (a 3,000-foot trend whose best historic hole ran 1.07 oz/t gold over 3.2 feet) and the Freeman system to the north across 11 parallel structures, targeting 50 or more holes a month from May-June.

Nick Giambruno's takeaways

  • Top takeaway Asks why the shares have fallen about 50% since April; hears illiquidity, profit-taking by $0.50 placement holders, no drilling news since Phase 1, and a pullback in gold.
  • Asks how long the cash lasts; hears the $3.7 million underground budget is covered on the balance sheet but that spending it in full likely forces a small raise before June.

Byron King's takeaways

  • Top takeaway Endorses the pivot as changing the house odds: a roughly 97% cut in internal cost per drill meter means far more holes for far less money, which he calls how mineralization is actually found.
  • Asks what the deliverable of the first 300 holes will be, drawing out the plan to drill from the 830-foot level, then the Adventure system to the south (3,000-foot trend, best historic hole 1.07 oz/t gold over 3.2 feet) and Freeman to the north.
  • Calls the setup serendipitous, with intact, dewaterable workings on patented private ground, and notes that drilling rather than talk is what finds deposits.

Gary Bohm's takeaways

  • Top takeaway Cites that Arizona Eagle's in-ground resources are priced about 60% below peer averages and that the stock has underperformed the GDXJ over the past eight months, asking how the narrative shifts from prospectivity to proof.
  • Asks about institutional interest; hears there is none yet with one meeting set for mid-October, and that institutions don't buy roughly $30 million market caps, so it is the CEO's job to change the market cap.

John Hunt's takeaways

  • Top takeaway Points out that with drilling costs cut to about $200,000 per 60 holes, assay costs of perhaps $50 each stop being a rounding error and could reach half of program cost.
  • Questions the integrity of 40-year-old concrete in the ventilation shaft and whether deeper, more acidic water could change the cost case; hears the budget assumed the worst and that submersion limits oxidation.
  • Asks whether water will be tested at depth rather than just at the top; hears stratigraphic testing at every level is underway, with results so far at drinking quality though some are still pending.

Graham Summers's takeaways

  • Top takeaway Congratulates the CEO on unlocking value and asks which company Arizona Eagle should be compared to; hears Goldcorp's Dickinson mine, Cripple Creek, and Red Lake as the analogies.
  • Draws out the grade claim: an 11.7 g/t recovered grade at the 1984 6.8 g/t cutoff would make McCabe one of the highest-grade gold systems in North America, if not the world.

Brian Lenny's takeaways

  • Top takeaway Opens the Q&A by challenging the pivot, asking why the company didn't dewater from the start and whether the summer drill program failed; hears it wasn't, with two economic intersections in seven wildcat holes (about a 30% hit rate) and the switch following four months of engineering work.
  • Presses on prioritization, noting the silver-mine acquisitions, the surface drilling, and now dewatering; hears priorities changed once re-entry proved dramatically cheaper and that the company will pivot again if better opportunities appear.