Which are the top 10 stocks that can grow more than 100-150% in the coming 6 months?

Instead of going into 10 without doing much in-depth explanation, I’ll go into 5 that I’ve been looking at.

I can’t guarantee they grow 100–150% in the coming 6 months (nobody can), but there’s a high probability they are all multi-baggers (5–10x+) in the next few years (I really can’t call when!).

1. Antero Resources (AR)

Antero is the second largest NGL (propane) producer in the United States with 50% free cash flow yield.

There’s a piece of research done by Goehring & Rozencwajg where they talk about oil/gas ratio going from $25 to 6-8x. They feel confident we will see WTI (West Texas Intermediate—crude index) at $75 which means gas could be $9~$12.

If they are even half right the AR’s $20 target will get blown up multiple times.

Don’t ignore the fact that Warren Buffett made a bet on the macro tailwind of natural gas and allocated $10B into Dominion Energy.

The asymmetry here is huge!

2. Paladin Energy (ASX: PDN)

What makes Paladin interesting is not only the macro tailwind that comes with the uranium bull thesis (I won’t go into detail here), but Sachem Cove are now filers on PDN at 5%, Segra is ~3% and I personally own a ton of it (averaged at 0.09 AUD).

• 5 years of cash burn left (as of 2020) post-closing Kayelakara mine.
• PDN claimed they can ramp to 80% of production in 6 months and 100% in 12 months.
• While they do hold a good amount of debt, I’m not worried as Paladin has a $600M asset on the ground. When uranium recovers, it will be able to refinance the debt in a flash.
• CEO's not 10x from here but is certainly highly incentivized as per below…

3. Euronav (EURN)

EURN is a tanker company that actually has decent corporate governance.

They recently bought back another 2.27M shares, which altogether, they have bought back nearly 8.5M shares (4.25% of float) in July of 2020.

The float is shrinking, fleet will grow opportunistically, and any profits pay you a handsome dividend.

$0.47 a share in dividends for Q2 results (they are mixing buybacks with paying out dividends).

Last quarter, it was all dividends (~$1.10, if I remember correctly). And this was for a sub-$10 stock!

Again, the asymmetry here is insane, and it’s not even being priced in!

4. Oroco Resource (TSE: OCO)

My friend recommended me to take a look in 2018, and I regret I didn’t.

He averaged at ~$0.04 CAD/share.

Oroco engages in the acquisition, exploration, and development of mineral properties in Mexico (mainly copper).

They own about 60 percent of Santo Tomas copper mine. After spending $30 million on drilling and drilling related expenditures, it now owns 80% of Santo Tomas.

If we assume three scenarios for drilling success…

1. No success
2. Moderate success
3. Huge success

No Success

No success means that Santo Tomas will remain at 10 billion pounds of copper. This is highly unlikely but let’s look at this extreme bear case. Let’s assume the Company will raise $30 million by selling 30 million shares so the number of shares will grow from 150 million to 180 million.

I’ve done the math for this extremely unlikely bear case, and…

Trading value would be $1.73 CAD/share.

Buyout value would be $4.04 CAD/share.

Moderate Success

Moderate success is when the company is able to convert inferred to measured and indicated. In this scenario, Santo Tomas would grow from 10 billion pounds to about 15 billion pounds.

Trading value would be $2.60 CAD/share.

Buyout value would be $6.07 CAD/share.

This is not such a bad scenario if Santo Tomas were moderately successful.

Huge Success

Truth is, Santo Tomas has huge exploration potential and the mine has been a secret to the public for decades. If Oroco can hit holes with 1% grade and find enough tonnage, the upside would be huge, as in they would generate a yearly profit of $1.6B.

Even with just 1% grade, they can make $45 per tonne of profit versus $10 per tonne on 0.4% grade, which would make Santo Tomas worth $3–5B.

We’ll take the more conservative path even for this Huge Success case and use that $3B number.

Buyout value would be $3B x Oroco’s 80% of Santo Tomas = $2.4B

$2.4 billion / 180 million shares = US $13.33/share

Which translates to ~$17.33 CAD/share for buyout value.

5. Bank of America (BAC)

Just something that’s been on my radar, as Buffett’s been buying in 2020.

And you have to remember, Buffett makes as few decisions as possible, as he understands it’s easier to make a few good decisions than many bad ones.

If you’re interested in learning about more mis-priced deep value investment ideas targeting 5–10x+ returns, I highly recommend checking out Chris MacIntosh’s weekly newsletter.

Chris retired in his late-20s, having made his fortune in asymmetric bets like…

• The New Zealand real estate (64x return)
• The last commodities bull market (10x)
• Bitcoin (20x)
• Shipping (27x)

He’s been buying/holding these investments for a few years now, and now they are finally starting to run. He now runs a deep value hedge fund called Glenorchy Capital and shares his research with the wider investing community who cannot access his fund.

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