Midway in Play: Gold Penny Stock worth Tracking

As gold asserts its role as money amid the battle across the Atlantic, for which currency is more flawed, early birds to the coming explosion in gold penny stocks may find themselves as the new millionaires in the coming years.

It might be wise to begin the due diligence process and add the very best prospects to your portfolio, keeping in mind that these stocks are high risk.  But when the juniors start to fly, there’s no higher high than a gold rush.

Because the choice of hundreds of gold pennies is difficult to narrow down to, say, five to ten stocks to watch, a competent analysis who’s done his homework may be good place to start.  And one analyst who’s reputation is among the highest on the Street, Louis Navalier, already published his picks on March 31.

After researching the performance of his six picks, four of the six stocks have traced a similar path to the gold junior mining index (GDXJ).  One of Navalier’s stock picks truly stands out as an explorer that’s gaining the Big Mo, Midway Gold Corp. (AMEX: MDW).

Exploration-stage company Midway Gold stock has skyrocketed to 175% gains year-to-date, and a monstrous 463%, year-over-year.  The stock currently trades at $2.31, well above its 13-week and 52-week moving averages of $1.96 and $1.28, respectively.

Midway’s properties, located in Nevada and Montana, include the Midway, Spring Valley, Pan, Gold Rock and Golden Eagle.  Of the five properties, the Pan, located at the northern end of the Pancake mountain range in western Nevada, approximately 22 miles southeast of Eureka, has been where the action is, as the company has to date reported drill results of 21 holes, some results were so-so, some pretty good, and a couple of drills flew off the charts.

The latest drill result, the most impressive of them all, was reported on June 13, popping the stock 7.4% to $1.87 from the previous trading day close of $1.74 as well as triggering a 32% rally to day’s $2.31 print.

“Drill hole PN11-09 contained the longest and highest grade gold intercept yet encountered at its 100% controlled Pan Project, White Pine County, Nevada,” the company stated in the June 13 news release.  “This 30 meter intercept of 3.15 grams per tonne (gpt) gold includes a zone of 13.7 meters of 5.79 gpt gold which also includes a 1.5 meter interval of 10.1 gpt gold.”

And, two weeks later, on July 27, MDW announced that it has been added to the Russell 3000 Index.  Initially, the stock sold off a bit after the run up on the 24th, the day MDW was added to the Russell 3000.  Then it traded sideways for a couple of weeks before rallying as high as $2.89 on July 18.  The stock has since succumbed to profit-taking back down to the $2.30 level.

According to yahoo Finance, MDW has attracted 16 institutions.  Two investors hold more than $35 million worth of shares, of which, half of 15.5 million shares held by the two investors was recently been purchased by Hayward Securities.