I’ve bundled these by theme.
North American re-shoring and US infrastructure buildout
- AtkinsRealis: Common and 2025 calls
- Quarterhill
- Centrus
- EWW: Common + OTM 2025/2026 calls
I acquired some call options on the iShares Mexico ETF that performed so well I’ve bought the common and added more long-dated contracts. This will be a core position. SNC-Lavalin changed its name to AtkinsRealis during the year to get away from its scandal-ridden past. I acquired most of this position in the low $30-range and expect it to be in the portfolio for years. As lump sum turn key projects come off its books, investors will realize this company is going to make billions of dollars servicing nuclear and infrastructure needs.
Midwest Energy Emissions
MEEC is a special situation investment based on the upcoming settlement of a patent infringement lawsuit. This is a classic Pabrai setup: there’s high uncertainty but low risk. The current market cap is approximately $85-million USD. A settlement of $50 million or less and the shares are probably fairly valued to slightly overvalued. But a settlement in the $100-$200 million range is well above the current market cap. The defendants that have already settled are now giving the company earnings and cash flow via licensing agreements. There’s a range of outcomes here, but none of them involve losing a large amount of my investment.
Crypto capital flows via spot ETF approval
- Iris Energy
- Ether Capital
- Galaxy Ethereum ETF
- Filecoin
The perception of bitcoin as high beta equity is overly simplistic and the cryptocurrency market isn’t going anywhere. Recent SEC applications for a spot bitcoin ETF will eventually be approved – and with them another avenue for institutional crypto allocation. Iris Energy is a bitcoin miner with hidden assets. Its custom-built data centres and power purchase contracts will allow IREN to seamlessly pivot to servicing the AI market after it’s done harvesting outsize profits from bitcoin. Ether Capital has been a frustrating investment. It may require an activist approach if Som Seif won’t do the right thing and convert the company to a staking ETF so it can eventually trade closer to its $16 fair value.
Commodities
- Filo
- Salazar Resources
- Alphamin
- Kazatomprom
- Vulcan Minerals
- Ecora Resources
- Altius Minerals
- Elemental Altus
- Minera Alamos
- CVR Partners
- Chibougamau Independent Mines
I don’t want to own any mining stock that has to raise capital right now. I feel like I have a good mix of best-in-class assets and stocks with significant asset value and a defined catalyst the market doesn’t believe in. A new government in Ecuador is moving the permitting process forward at El Domo, while Ross Beaty’s involvement with Adventus means financing construction is no longer a concern either. It all adds up to Salazar Resource’s free carry on the project eventually becoming incredibly valuable in relation to its $10-million market cap. Minera Alamos is another coiled spring, a self-funding gold developer that should come out of permit purgatory in 2024.
Other Stocks
- EWJ: Common + OTM 2026 calls
- Elanco: 2025 + 2026 OTM call options
- Kaspi
- Sun Communities
I owned Elanco Animal Health but sold for a 20-percent gain in December. I’ve decided to limit my exposure to options because of the debt pile and future revenue mix skewing towards livestock rather than pets.
Punts
- SolGold
- Franco-Nevada: $120, Aug 2024 calls
- Sable Resources
- Kinross Contingent Value Rights
These are small bets I’ve already marked down to zero.
