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The Company's Eagle Gold Project in Yukon Canada hosts a National Instrument 43-101 compliant Reserve of 2.3 million ounces of gold.
Message: Analysis: Reaction Of VIT's Stock to Press Release
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For those of you who followed my advice you had an opportunity to load up adding trading units of capital in the low C$.60's today - in fact the stock actually dropped as low as C$.56. At the end of the session, VIT closed down C$.05 to close at C$.67. Although trading volume @ 1.4 million shares - 40% above it average trading volume, volume was not significant relative to the actual stock float in public hands. This subdued sales volume and the substantial recovery in VIT's stock from its intraday lows, indicated to me that the selling was primarily due to disappointed traders that were looking for some positive news to prop up its stock before year-end. When the good news didn't materialize in a timely manner, they just sold their stock, without consideration as to the long term positive fundamental for this company. People who really understand the compelling long term value of this company, were provided a Christmas gift today to add to their positions at discounted prices. Keep in mind that Summit was not considered a core property for VIT. IMO, it is probable that VIT will give back its Summit property due to poor drilling results and a high cost to VIT in maintaining its lease. Chad informed me that it costs VIT $100,000 to maintain its lease - which is due in March 2010 - in addition, it is costing VIT an additional $3,000 a month to retain its lease on this property. Investors should note that VIT is no one trick pony - it has many properties to allocate its funds for future drilling. It is likely, IMO, that before the end of January VIT will announce its drilling plans for 2010, and I am hopeful that Mill Canyon will be one of its primary targets - the reason being is that VIT had great drilling results a couple of years ago when VIT was a stepchild under Bema Gold. Despite the great drilling results, due to a lack of funds and different corporate priorities to fast tract its Kupol property in Russian, VIT had to temporarily abandon its drilling activities at Mill Canyon. Positive drilling results at Mill Canyon during that time were responsible for a significant upmove in VIT's stock. What is important to realize is the fact that VIT has two great properties, Eagle and Cove that will be moving closer to eventual production - a simple delay in two important reports for these properties to early 2010 has no significance whatsoever - other than some fickle short term traders. It is also important that one should be cautious in their expectation to see a large increase in resource estimates for Cove and Eagle in their reports that are due in early 2010. As for Cove, their NI 43-101 compliant resource estimate is likely to only report inferred resources - not indicated resources. There will be much more drilling required before the resource estimates will become indicated resources. Eagle property on the other hand, already has indicated resources and those numbers are bound to increase overtime as VIT continues to do more exploratory drilling. Long term investors who are patience and willing to ride out the significant short term up and down moves in this stock, IMO, will eventually be rewarded as the strong fundamentals for this company continue to improve. Personally, I will continue to maintain my position until such time that I feel VIT's fully reflects its true value in relation to its peer group of competitive junior exploration companies. One final note, before this bull market is over for the gold market, there will be a buying frenzy similar to the dot.com stocks that we had a few years ago - at that time we should see stocks like VIT selling at multiples of where they are today.
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