Missing Pieces

Often we as investors are left to go on a treasure hunt looking for pieces of the puzzle, and then trying to put it together.  The tough part is:

--> We don't often have all the crucial pieces

--> We seem to collect extra pieces that aren't necessary

--> We don't have an exact picture to look off of

One stock that continues to puzzle me (terrible pun), is Galway Resources.  This company seems to be a 10,000 piece puzzle, but yet I keep finding extra pieces when I think I am almost finished.  

As an analyst from Raymond James mentions, Galway is about to come out with their 43-101 for the California gold property in Colombia within the month of July.  The analyst just recently visited their site at California within the last few weeks.  Galway is also likely within months of coming out with a 43-101 at their Vetas property also in Colombia.

What's most interesting about this company is that they are within a stone's throw of Ventana Gold's property (now owned by Eike Batista), and they also own land fractions that dissect Eike's main mineralized zone multiple times.  Galway's property is at the lowest elevation as compared to Eike's property, and Eco Oro Mineral's (formerly Greystar Resources) property.

The pieces of the puzzle that make me think something huge is about to happen is the amount of silence from the company.  Here is a list of very odd events that have occurred within the last 6 months:

--> Delaying the AGM on June 27th, and giving no reason as to why.  They still have yet to give a make-up date.

--> No results from their Vetas property in over 4 months, yet 5 drills are turning there.

--> No results from their California property in 2 months, and previously a 6 month window without reporting results, yet they have had 3-4 drills continuously turning.

--> No insider buys, or sells, or any options granted

--> Very odd trading patterns

--> The lack of concern from management to do anything about the share price in the short term, even though the CEO (Rob Hinchcliffe) owns 2.3 million shares worth approximately $2 million dollars. 

--> The CEO used to be an investment banker, and his brother is the current CEO of Kirkland Lake Gold, so you would think he would understand the need to be as transparent as possible with investors.

--> The analyst from Raymond James who recently visited the property noted the following,

"AUX has constructed a large camp (reportedly with ~400 people on site), has from 13 to 19 drill rigs operating The Galway properties are adjacent to and on strike to AUX and also include narrow (10m to 30 m) wedges cutting into AUX’s mineralized zones. We believe the position of the wedges and the positive drill results from Galway make the company a prime take-out target for AUX.  We noted a definite difference in the quality of work at California versus Vetas. Although California may be the largest contributor to the value of the company, we believe it did not have the same quality of information gathering as at Vetas and we believe did not appear to be treated as a long-term core asset for the company

So what does this puzzle look like to me?

To me there must be negotiations going on behind the scenes.  Eike clearly would want Galway's property since they own fractions within his claim, and also likely holds at least 1.75Moz of gold at an average grade of at least 4g/tonne.  As well, their Vetas property shares a border with CBJ, in which Ross Beaty took an $11 million dollar stake in last year.  It is also possible that there are serious negotiations going on there as well.

The end result?

I see Galway in the middle of a huge deal(s).  They currently trade at 93 cents, or about a $120,000,000 market cap.  If this stock does not hit at least $2.00 before the end of the year I will quit investing and never look back.  I have been wrong plenty, but if I am wrong on this one then I really should hang it up.