More Market and Stock Talk: Watching Ramaco for rare earths updates is like watching grass grow BUT good divys are in the grass.

 

 Market Talk

The Federal Reserve, led by Jerome Powell, will report on their decision on interest rates on July 26.  Their goal is to quell inflation from 4% range back down to 2 %.  Good luck with that.  Meanwhile, the jobs reports have been coming back from pandemic lows and wages have been rising that tends to keep inflation going.  The Fed has already signaled that it could raise rates another 25 % basis points to hike to 5.5%.  Further, they signaled that it could be not one, but two rate hikes to come. We should recall that the Fed's primary mission is to fight inflation.

 

They have to try to slow down the economy and try to make the soft landing of low inflation and full employment. But the casualty of higher rates is typically job cuts and other impacts that can lead to the R word. One impact of higher rates is commodity prices like Gold tend to dip.  This can also happen to crypto - like bitcoin.  As time ticks forward to July 26, it may be interesting to see if  both gold and bitcoin issues start to subside in price.

 

Stock Talk

 

Focusing more on small cap stocks than larger cap stocks and definitely stocks under $100 and many under $10 with speculative possibilities for much higher.  Due to the speculative nature, I use the word "some".  Too much of any risky stock can really hurt. With that said the entire market is a gamble.  Its a matter of relativity.

Stocks on Watch:

Ramaco Resources ( METC): 

Both METC  (Class A) and  METCB (class B) seem undervalued.

There are " bitcoin miners " losing $$ chasing tails and pay no dividend.  Priced many multiples above a real miner like METC  that has comparatively a great eps ($2.25)  and dividend  and has a take in possibly the largest American reserve of rare earths that have better substrate quality for processing than competing reserves held by China.

METCB shares were newly formed as a royalty vehicle that will derive revenues from a 20% royalty from METC mining activities. While full details are in process, a back of envelope calculation points to very positive dividend that could be paid to METCB shareholders.

The catalyst for this observer will be what is decided with the magnetic rare earths in the Ramaco Wyoming property. Previous findings pointed to vast rare earths that would potentially be more readily mined requiring less processing. In the meantime, the revenues and earnings from metallic coal at several mines are doing just fine. This is NOT thermal coal, it's coking coal often called metallic coal with carbon used (update) to produce steel.  Metallic coal is needed to produce all kinds and levels of steel ranging from high quality refined steel with special added alloys to pig iron used for example in automotive and other iron based castings. 

Devon Energy (DVN) :  Current "some"  position on this oil and natural gas company here in America.  Recent cutbacks is Saudi production and higher gasoline prices at the pump keep me holding some DVN.  We see the share price today moving into the 50's. If DVN can hold the 50's it could be on its way back to higher values .

USFR :  An etf to maybe stash some dry powder for a good interest rate based on US treasury notes. As the fed raises rates , the USFR dividend is based on short term treasury notes.  This may not be a bad place to put some dry powder.  Etf's are not guaranteed vehicles but Wisdom tree has a good track record of staying on point with USFR.  For this report, we always just say maybe "some".

Oncolytics Biotech (ONCY):

ONCY has been under recent quiet accumulation in high volume days. Preparations are  being made for Phase 3 trials on Breast and Pancreatic Cancer treatments. Coordination of a faster trial than fast track is in process as reported in a PR.  ONCY has some potential to explode higher due the nature of goal in this special Phase 3 Pancreatic cancer trial. But, this is a speculative issue and in the Jones report view " maybe some, but not too much"  if they hit the target some could be enough to enjoy a nice gain without too much risk. While this is speculation, some company like Merck KGaA could be watching ONCY as a potential partner. It fits their profile and other big pharmas may be watching and possibly part of the recent accumulation .

Hepion Phamaceuticals (HEPA):  Both ONCY above and HEPA have a similar profile. they are both at the cusp of starting the final phase 3 of clinical trials. HEPA has a shot with a promising drug to treat liver disease in again, a potential market of $ Billions. Both ONCY and HEPA could benefit from a collaborating partner to help fund pursuit of two promising treatments to help people. HEPA has been pretty quiet.  It's hard to tell what they are up to.

 

I close this post by noting that any view on the market and stocks on any particular day may change in the future days to come. That is why we watch and see how our views match up with the reality of the time.  But trying to look ahead a few months into the future may be a way to explore things.  If you think too deep about world events and the recent alliances forming, projecting ahead can be a dicey endeavor. With all the above caveats and attempted prognostications, I will close this post. 

Stay tuned for more opining on the market and stocks to watch.

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ALL in my humble opinion, scroll down and read more.

This site does NOT make Buy / Sell recommendations.
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