Gollum’s Syndrome: The Burden and the Treasure of Silver’s “The Precious”: Coeur d’Alene Mines Corporation (CDE)

Finally, the single greatest differentiating factor between Coeur d’Alene Mines and First Majestic Silver — when it comes to determining which of the two is better positioned to deliver value-generating execution of the La Preciosa project — can be found in their extremely divergent track records. Over the trailing six-plus years since I mistakenly initiated Coeur d’Alene Mines as an outperform pick within my Motley Fool CAPS portfolio, the stock has cratered by 54% against the backdrop of a powerful 136% advance in the price of silver. On the other hand, First Majestic counts among the industry’s elite growth generators, with a steady progression of beautifully executed growth initiatives to yield a 322% gain over the same period.

I’ve seen First Majestic fine-tune its recently acquired silver guitar, and I’ve also watched with fascination as Coeur d’Alene Mines failed to renew mining claims at the Rochester mine in Nevada. I know which company I consider more capable of unlocking substantial shareholder value from La Preciosa, and I await with bated breath an effective counteroffer from First Majestic Silver before the Feb. 19 deadline imposed by Coeur’s competing bid. I do have skin in this game, as a shareholder of First Majestic who intends to hold his position for the very long haul, but I do believe I have retained objectivity in determining that First Majestic Silver offers the potential for a more lucrative path to production for La Preciosa.

The article Gollum’s Syndrome: The Burden and the Treasure of Silver’s “The Precious” originally appeared on Fool.com and is written by Christopher Barker.

Fool contributor Christopher Barker owns shares of Endeavour Silver and First Majestic Silver. The Motley Fool has no position in any of the stocks mentioned.

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