Gerardo Del Real is making big predictions about a gold stock, claiming it could soar by 12,500% as gold prices hit new highs. The bold projection might grab your attention—perhaps even enough to consider his $199 newsletter subscription.
Let’s break down Del Real’s claims and see if his pitch is truly compelling. While this stock might have potential, it’s essential to analyze the facts without feeling pressured into a $199 newsletter subscription. Whether or not you join Junior Resource Report is your choice, we’ll disclose the stock name so you won’t need to rely on the newsletter for that.
Interestingly, there aren’t many reviews available for service of Del Real, making it harder to gauge its credibility. Now, let’s get into the details: the pitch revolves around John Paulson taking another legendary trade—This round in gold.
John Paulson draws interest due to his remarkable achievement during the financial crisis, making one of the biggest wagers against the high-risk mortgage market in 2007. That move earned the title “The most significant trade in history”.
Del Real thinks Paulson is on track for another major victory, though in a completely new sector this time.
The ad attributes Del Real’s success to his picks in the mining sector, including Magna Gold, Nevada Sunrise, K2Gold in 2019-2020, with reported gains between 500% and 1400%. While we’ll take those claims at face value, it’s worth noting that his touted 1450% return on Nevada Sunrise came from buying near pandemic downturn in 2020, offloading at the peak that September. However, he had highlighted the stock as early as October 2017. While it surged between March and September 2020, returns were far less impressive for those who bought in earlier.
Nevada Sunrise stands out because Del Real hasn’t publicly hinted at the other stocks. Keep in mind that junior mining firms are highly volatile, often serving as short-term trading opportunities rather than long-term wealth-building assets. For instance, Nevada Sunrise primarily operates as a gold and copper exploration developer.
Junior miners are extremely sensitive to both positive and negative news, making past returns seem remarkable in hindsight. However, capitalizing on these moves instantaneously requires a contrarian mindset and quick decision-making. At their lows, such stocks appear risky, yet at their peaks, they hold massive potential—making it easy for investors to fall into a common trap.
And then, Del Real continues…
Yes, this falls into familiar territory. We’ve monitored Del Real alongside his associate Nick Hodge while they’ve repeatedly promoted this same mining stock since 2018. Let’s examine the latest insights from the newest pitch to confirm the details.
The ad suggests Paulson is placing a sizable wager on gold, convinced that we’re approaching a crisis surpassing the 2008 financial meltdown. He likens it more to the downturn of the 1970s in the U.S. as a dominant global power, predicting a weakening dollar and the perfect conditions in anticipation of a gold surge.
However, today’s situation differs significantly from that era, particularly concerning gold. In the early 1970s, Nixon’s move to abandon Bretton Woods system severed the dollar’s link to gold, causing the fixed $35 per ounce price—unchanged since World War 2—to skyrocket past $800 by 1980. Gold then entered a prolonged decline as inflationary pressures were eventually controlled.
That said, some parallels exist. Recent inflation recalls the late seventies, while ongoing geopolitical instability and economic uncertainty evoke a sense of déjà vu. The cultural, political fractures we see now mirror those of decades past.
For 45 years—aside from a brief period of fiscal restraint before 9/11—the U.S. has operated with mounting deficits, debt, relying on global confidence to sustain its role as a financial powerhouse. But that confidence may be wearing thin. Politicians across the board largely sidestep the issue, favoring narratives of tax reductions and continued government spending to appease voters.
If inflation remains high and interest rates stay elevated, reality may soon be impossible to ignore. Debt interest payments now account for 14% of federal spending, exceeding defense expenditures for the initial time. Only Social Security, consuming 22% of the budget, ranks higher. This makes addressing deficits politically complex, as discretionary spending on infrastructure and other programs has already been reduced to a fraction of total expenditures.
Given these conditions, the case for gold appears stronger. The metal has climbed over 50% from its 2022 lows, reaching record highs this year.
Could this signal the start of another gold supercycle as the 1970s? Possibly. A crucial factor will be whether investors continue flocking to gold, as central banks have done since the Russian Ukraine incursion. Nations like China, Iran, and Brazil, wary of U.S. sanctions, have significantly expanded their gold reserves. Meanwhile, a surge in advertisements urging people to convert IRAs into gold hints at growing retail interest.
But only time will tell.
Now, returning to Del Real’s most significant gold trade in history” … what more does he reveal regarding this mining company? According to him, its significance is far greater than most realize…
It also holds substantial reserves of antimony, a pivotal strategic metal essential to the Pentagon…
And it may also serve as a material for electrodes in next-generation batteries…
Del Real claims this newly discovered mine offers environmental benefits…
This is a well-known story, as Del Real, Nick Hodge possess discussed this share for years. The latest update is that the permit have been granted, however the ad has yet to mention it.
Del Real believes this company has far greater upside, and here’s why:
Perpetua Resources (PPTA), formerly Midas Gold, is drawing attention for its Stibnite Mine project. While estimates of 0.02 billion ounces are left speculative, mining firms are rarely valued near their projected gold output due to uncertainties in costs and prices. Historically, gold acquisitions have priced reserves at 5 precent-25 precent of the present value of gold, with an average of 187 dollars per ounce from 2012-2021.
Perpetua has advanced in permitting, receiving the completed Environmental Assessment Report, preliminary Final Decision Statement from the USA Forest Service’s draft decision on September 5th. A final decision is expected by December, though further approvals are still required. Objections exist but are unlikely to halt progress.
Perpetua Resources (PPTA) has experienced steady optimism, keeping its stock price higher than 4 dollars since March, reaching close to $9. However, prolonged delays in obtaining permits and occasional needs for additional exploration funding—particularly during periods of lower gold prices—have prevented long-term investors from realizing substantial gains. Past instances where the company appeared close to securing permits often resulted in further setbacks, reinforcing market skepticism.
Despite this, Perpetua has had a strong year in 2023, supported by rising gold prices and key developments. One of the major catalysts for the stock’s early-year gains was the U.S. Export-Import Bank’s (EXIM) issuance of a “statement of interest” for a potential $1,800 million financing package to fund Stibnite mine project. This announcement closely followed the hiring of a newly appointed CEO with extensive mining experience, reinforcing the perception that construction might soon commence.
Looking ahead, Perpetua’s next phase involves finalizing financing, which could come from EXIM, other investors. The company must also establish infrastructure, such as roads and power lines, procure mining equipment, and complete detailed engineering and design work. Its economic projections still rely on a 2020 viability assessment, but with shifting market conditions—rising gold prices alongside higher construction, operational costs—the company estimates that the project is currently priced at under 20% of its NPV, assuming gold remains at or above $2,350 per ounce.
With the permitting process nearing completion, Perpetua’s market capitalization has approached $600 million. The company expects to secure its final Decision Statement by the close of 2023, followed by additional permits and financing in the beginning of 2025. A official construction decision is anticipated later that year, with operations projected to commence in 2028—delayed by two years from initial forecasts.
Perpetua aims for a significant revaluation once permitting hurdles are cleared, hoping to see its reserves valued between 200 and 500 dollars per ounce, a notable increase from the $118 per ounce recorded in September. However, uncertainties persist. The company has not updated its reserve estimates in years, and while additional studies or new gold discoveries could enhance its valuation, potential regulatory constraints could limit the mine’s scale or mandate costly reclamation efforts following 15 years, regardless of whether untapped gold remains.
The 2020 viability assessment estimated that developing Stibnite mine project would require a preliminary investment investment of $1,300 million. With the potential $1,800 million loan from EXIM, most—if not all—of the costs would be covered. The study estimated that the post-tax net operating cash flow would reach $584 million annually for the initial 4 years of output, based on a gold price of $1,850 per ounce. If these financial projections hold, Perpetua could repay the loan within just a few years. While production levels are expected to decline after the initial ramp-up phase, the project still appears financially viable over the long term, particularly if gold values remain elevated.
Forecasting Perpetua’s valuation in 2030 remains challenging, especially once the company reaches full production. Using SSR Mining as a comparable, which was valued at approximately 10 times net operating cash flow in 2022, Perpetua could reach a $4 billion market capitalization if construction, permitting proceed smoothly and gold prices stay strong. This valuation assumes an average annual net operating cash flow of $0.4 billion over a 15-year mine life, which would justify such a multiple. Should the stock rise from its present market cap of about $0.55 billion to $4000 million by 2030, investors could see an annualized return of approximately 40%.
However, Mineral development project are inherently volatile, and the road to such a valuation is unlikely to be linear. Share prices in the sector often exhibit extreme fluctuations, and Perpetua may need to revise its feasibility study or adjust financing terms throughout the journey. Nonetheless, based on the financials outlined in the feasibility study, the potential for long-term gains remains significant—provided the company can execute its plans successfully.
If Perpetua were to attract acquisition interest, fair offer could be in the range of $400/ounce of resources. At that valuation, the company would be worth approximately $1,900 million, representing a 300% increase from its current market cap. That said, no clear signals suggest an acquisition is imminent. Notably, Barrick Gold—the most probable suitor—exited its position in Perpetua in 2022, indicating a lack of ongoing interest.
Perpetua’s shareholder base is now dominated by financial institutions, with hedge funds playing a significant role. As of the most recent disclosures, John Paulson’s company holds the largest stake, controlling roughly 44% of outstanding shares. Paulson has been major investor since 2016 and has continued to inject capital into the company. His firm’s significant ownership stake provides stability but also means that any major corporate decisions, including potential acquisitions or strategic shifts, will likely be influenced by him and other large institutional investors.
Despite the optimism surrounding Perpetua’s future, risks remain. If gold were to retreat to $1500 per ounce or if interest rates were to rise further, the project’s economics could weaken considerably. Under such conditions, the company might be forced to delay construction or put the project on hold. Even if the mine is operational, lower gold prices could squeeze profit margins, making it difficult for Perpetua to break even. Much of the company’s future hinges on securing favorable terms for the $1,800 million EXIM loan, as financial backing will be essential for navigating potential downturns in commodity markets.
For investors evaluating Perpetua, it’s worth considering the typical life cycle of a mining stock. According to U.S. Global Investors, junior mining companies generally progress through several phases: prospecting, exploration, discovery, financing, feasibility studies, construction, and ultimately production. Once a mine enters production, additional assessments and potential resource discoveries can further extend its lifespan and enhance its valuation.
Currently, Perpetua remains in the financing and permitting stages, with construction expected to begin within the next few years. Investors in pre-production mining stocks must recognize that they are making a long-term bet on management’s ability to execute across multiple phases, while also being exposed to external factors such as commodity price volatility.
While full-scale production is still several years away, the recent surge in gold prices and the company’s progress toward securing final permits could present an attractive entry point for those willing to embrace the inherent risks. However, as with any mining investment, patience and a high tolerance for volatility will be essential.
Given the prevailing global financial uncertainties and increasing distrust in government policies, gold is expected to retain its appeal as a store of value, potentially driving prices higher over time. However, mining stocks historically tend to be high-risk investments, and betting at a mining site progressing from development to full-scale commercial production within the next 5 years carries inherent risks. While Perpetua appears to be in a relatively strong position at this stage—roughly a year away from a final production decision, the start of construction—the road ahead remains uncertain. Even in the absence of major obstacles, much still hinges on securing financing and assessing how capital costs for construction, startup have evolved since the initial feasibility study was conducted four years ago. Investors should prepare for potential disappointments in the near term, as stock volatility is likely, particularly during the three-year construction phase. if gold values decline or investor patience wears thin, Perpetua’s valuation could face temporary declines.
The company’s secondary value proposition—the potential to supply antimony for battery technology—is speculative at this stage. Even in an ideal scenario, Perpetua won’t start antimony production not before 2028, and mining projects are notoriously prone to delays. However, its partnership with Ambri, a company developing “molten metal” battery technology, introduces an intriguing long-term opportunity. Ambri has been working on this technology for years and has high-profile investors, including Bill Gates and John Paulson, who have stepped in to provide financial support during periods of distress. While Ambri signed a procurement agreement with Perpetua in 2021, it remains preliminary, and the landscape could shift significantly before production begins. If Ambri’s technology gains traction when Stibnite Mine becomes operational, it could provide an additional revenue stream for Perpetua—but for now, that remains an open question.
So, what’s the investment case? Could the current rally in gold prices—potentially influenced by election-year uncertainty—serve as a catalyst for Perpetua, accelerating its path to construction in 2025 following years of setbacks? Is this a stock worth holding through its development cycle in anticipation of strong net operating cash flow five to ten years down the line, or is it more suitable for shorter-term trading based on news and project milestones? Ultimately, these are the key decisions investors must weigh, balancing the potential for long-term rewards against the inherent volatility and risks associated with junior mining stocks.
