Below you will find two NEW RECOMMENDATIONS of companies in the growth stock category; they are Avino Silver and Gold Mines, Ltd. (NYSE-MKT-ASM) (TSX-ASM) and Energy XXI, Inc. (NASD-EXXI).  The upcoming issue which you’ll have by or before Monday will have more details on each; but here I’ll give you the Cliffs Notes version.

First, a couple quick market observations:

Our old “Odd Couple” is looking chipper, as the overall stock market struggles with whether it really wants to correct at long last or not. As for stocks, back on Tuesday the S&P 500 logged what is called an “outside reversal day.”  This means, if you recall past such times I have pointed out, that stocks on that day moved to a new high, above the previous day’s high…but then dropped below the previous day’s low, closing near that low.

No indicator is ever 100% accurate; but if you take a minute and go to www.stockcharts.com and check out the most recent time this happened back in early April, the weakness led to about a 75-point decline in the S&P 500 which, for a few days, pushed it below its 50-day moving average.

That level now is at around 1907, meaning there is more likely than not 50 points or so to the downside here in the coming days.  Thus, I am very happy that we still have such a high cash position, with which to incrementally add good companies here and there!

As for “The Odd Couple” —

Treasuries have recaptured their bullish tenor for now, in the wake, primarily, of this week’s horrid final number on first quarter GDP which — at a 2.9% contraction — was the worst showing since the gloomy days of the first quarter of 2009.  Everyone is now tripping over one another to slash their full-year growth estimates.  Interestingly, not even the hawkish comments yesterday of St. Louis Fed President James Bullard were able to upset things, and the day ended with the yield on the 10-year Note fluttering back down to around 2.52%.

I’m glad we kept at least some exposure to TLT and IEF after lightening up some lately. What I will be watching – if we get anywhere near there — is the 2.4% level.  As I pointed out recently, that had previously been a lid on yields before they broke above that level last year.  Barring some major escalation in hostilities somewhere on the planet or a major breakdown for stocks, I don’t see the yield moving back below that, given the heightened inflation fears at the moment. 

Gold impressed me anew the last couple days, basically shrugging off news out of China that previously would have sent it reeling, and invited the “shorts” to instigate a bear raid. For starters, it was reported that imports into China from Hong Kong in May had fallen off sharply (though this was at the same time countered by news that — contrary to the “official” report that the country imported a net 1,200 metric tons or so of the yellow metal in 2013 — the true number was more on the order of 2,000 metric tons!)

The bigger bombshell, though, was the apparent confirmation that a rumor of several weeks ago (that I passed on to you at the time, and which back then DID knock gold down a bit) is true:  Certain investment and trading parties in China indeed have pledged the same gold collateral many times over in order to obtain loans from Chinese banks, just as has been the case where copper, aluminum and iron ore have been concerned.  You’ll be hearing more about this.  But for present purposes, the fact that gold did not get hammered and still is holding virtually all of last week’s Janet Yellen-fueled gains strongly suggests that the recent bounce was not of the “dead cat” variety.

Now, on to two NEW additions to my recommendations:

 Avino Silver and Gold Mines, Ltd (NYSE Mkt-ASM) (TSX-ASM);

Yesterday’s close — $2.20; P.E. (2014 forecast) — 11.00

Avino, which been reinvigorating and organically growing an attractive primary silver property in Durango State, Mexico, is a company I have been watching more closely than others.  I have had the pleasure of visiting on a few past occasions with the company’s President and C.E.O., David Wolfin, who I saw again most recently at April’s Chicago Resource Expo.

While most mining company shares still sell for less than half of their peak prices of late 2010/early 2011, Avino has recovered better than most.  And this is for good reason.  The first quarter of this year saw the company report an astonishing jump in both free cash flow and net earnings.  Costs have dropped considerably; all-in costs for silver-equivalent production in the first quarter were $12.85 per ounce, down from a bit over $20 per ounce in 2013’s first quarter.

Apart from a strong operating performance of late, two other aspects particularly animate me, and suggest that Avino will be an even more superior performer in its sector going forward:

First, production is set by year-end to triple, as mill and infrastructure improvements take ore throughput from the present 500 tons per day to 1,500. And as you’ll read further in the next issue, the ongoing potential to grow its reserves organically is extremely attractive.

Second — even as I have to believe that Avino itself might at some point be attractive to a larger company with nearby operations in Mexico — it is showing a desire for some accretive deals itself.  Just yesterday it announced it was purchasing a third of Bralorne Gold Mines, Ltd. (TSXV-BPM). Bralorne is a “sister” company of sorts to Avino (among other things, Wolfin is on its board.) Its primary asset is a small-scale producing gold mine in British Columbia, in an old camp which the company believes it can rebuild over time. 

 For more information on the company, visit www.avino.com.

 Avino is started as a BUY among my list of growth-oriented companies.

Energy XXI, Inc. (Nasdaq-EXXI);

Yesterday’s close – $23.26; P.E. — 20.58; Div. yield — 2.1%

This Bermuda-based energy producer has not exactly been in favor with most of Wall Street.  In my view there are two major reasons for this.  First, all the “fun” has been isolated somewhat where the companies involved in the big new fracking and other shale oil plays have been concerned.  Plain vanilla energy reserves more like those of EXXI (which has no less than 100 million barrels of proven reserves in Texas and Louisiana) have garnered less attention.

In addition, when EXXI announced that it was purchasing EPL Oil and Gas, Inc. (NYSE-EPL) shares suffered due to some fears that it would be too dilutive to EXXI shareholders in the end.

But some are rethinking this pessimism.  As you’ll be reading further in the upcoming issue, the combined company has an impressive footprint in the Gulf of Mexico area.  As time goes on and both economics and geology catch up with the still-hot shale plays, the industry will rediscover the value of such energy reserves as EXXI owns.  Indeed, some of the chatter surrounding the company has recently evolved into focusing on EXXI itself now a potential acquisition target.

For more information on the company, visit http://www.energyxxi.com/

Energy XXI is started as an “Accumulate” among my list of growth-oriented stocks.

Among the many other companies on my various short lists, I may even be adding one or two more in the upcoming issue.  Stay tuned!