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And I thought I was a cynic but Mr Tibbs you've outdone me!
You post a hellish dystopian picture of people fleeced to within an inch of the shirts on their back just because they lack the capacity or tenacity to think and act independently. I'd like to think you exaggerate but maybe not. You never here about this side of investing. Only the winners!
I hope I never join this particular madding crowd....ouch!!
Any macro gold folks on this board watching this development? Trying to understand the facts and timelines - but I understand Basel III upgrades gold to a risk free asset and furthermore requires that this may only apply if the gold is in an allocated account or physically held. Paper contracts and unallocated gold, in contrast, require 85% capital backing. The impact of this on comex action, and gold leasing, would be profound. I believe it goes live with EU banks end of June, and (I think) also US banks a few days before. It goes live in UK from January next year. If you believe that central banks need to recapitalise, then they would have every incentive to allow the gold price to appreciate substantially. The fear is that EU has 10k tons, US 8k tons, but UK has diddly squat. So it will f*** over the UK into the bargain which for the anti Brexiteers in the EU and US dems is a convenient side effect. Thoughts anyone?
You could put 10p on today’s share price and the stock would still be cheap.
Excellent post Tibbs, it really is a corrupt world where money is concerned,hope all is well,keep up with your posts it would not be the same without you. G. L. A.
Quite so Auson,
But the brokers don't care because so many traders want to be in and out in a day to avoid paying leverage costs or being knocked thru their stops!
None of these brokers are factoring in a Gold price well in excess of $2200. The sentiment a move like this will propel the PM miners much higher.
Adam,
You are quite right,they have no obligation to explain their reasoning behind their valuation, most likely this morning a number of their clients would have been knocked through their stop losses by the "gap up" on their CFD's and now be liable for trading commission, CRD in & out costs .Leverage fees and a nice loss!
In contrast Liburam will have made their commissions , CFD fees, whichever way the clients trades went!
If a client challenged them they would probably be told "Oh the market or sentiment moved against us" or "We can't get it right all the time!" "Thing to do now is get back in, open another position!".
Those clients that are still dizzy from being hit between the eyes by a Monday morning CFD slap down will probably be fooled into making the same mistake again out of desperation and some hope that the broker is on their side, so Liburum will make more commission and in and out CFD fees!
This will go on until he client has lots all their funds, their portfolio is gone or in ruins , even their home is at risk if it was put up as security against CFD leverage!
The bank lending the money will show no mercy and the broker won't care they will have hooked the next sucker!
This type industry that has been allowed to fester and propagate within the UK financial sector for far too long and the regulation of it is unfit for purpose, and rarely enforced, possibly because victims feel they are to blame, or are embarrassed to admit being taken in, the resulting misery, despair and ruination is on a far greater scale than the payday loan scams. the online Casino's,betting shops and bingo although the regulation these and and the consumer protection somewhat more effective, if victims are willing to ask for help!
But I digress, there is most probably far more to the ridiculous brokers rating than we can tell at this stage, but we are fortunate enough not to have been taken in for whatever reason, some unfortunately have been had, that will always be so,until they start putting some of the perpetrators of the unscrupulous practices behind bars!
As Cowichan says West Africa is extremely important to Centamin and as I have said on a number of occasions it is a great place to develop mones given the depth of experience already available. I have no idea why the board has said Batie West/Konkera or indeed maybe Burkina Faso is non core BUT a guess as others have said it is the refractory nature of the ore and then I would suggest the confusion around the processing method which has already been very well covered by Goldgnome.
Lycopodium are in my view the most experienced company in West Africa when it comes to planning and advising on the correct process and if they have reservations then I can understand the focus on Doropo and ABC over Burkina at this time.
I would also like to know what is meant by "Third Party" is this a joint venture, is this a sell off who knows?
I was hoping that Batie/ Konkera would be a let's get mining the oxides, using a form of simple leach process and use contractors operating 100 tonne trucks or smaller and get to know the nature of the mine and grow into the mine BUT Centamin are not that sort of company and does look as though they have reverted to type namely a conservative approach.
I think as it has already been suggested we need answers to why non core and what does third party really mean.
I do however favour the idea of focusing on the less risky options of Doropo and ABC and if the third party means bringing in a partner with added value to develop the Burkina assets then again I am all for it as I would hate for them to walk into something that they are not comfortable with purely because of bravado.
Really difficult decision as pretty much a no win, sell it and see it blossom under different management (heaven forbid Endeavour) keep it and it becomes a drain on funds.
I know technology has moved on but Bogosu had similar issues at the outset and the solution was use a roaster at considerable cost so much so went bust and the finance company had to run the mine until they introduced the then new technology "bug plant". The then forerunner of Lycopodium namely Minproc also suffered from their recommendation.
I would like to know more detail about the non core statement but am as I have already said very happy that there is a plan in place to develop Doropo and add value to the company with an additional mine, hopefully with ABC close on it's heels.
2/2
This column has yet to strike it rich with Centamin: the shares are showing no gain since our initial analysis more than two years ago as the firm has disappointed on production volumes and costs more than once. A development plan announced last week for its assets in Burkina Faso and Côte d’Ivoire also went down like a lead balloon with analysts. Yet the company should be primed to capitalise if gold prices do shoot higher, especially as a first-quarter update in April reaffirmed 2021 goals to produce between 400,000 and 430,000 ounces of gold at an “all-in sustained cost” of between $1,150 and $1,250 an ounce.
Admittedly, that means production will be lower and costs will be higher than in 2020. But the targets still underpin management’s aim of paying out at least $105m in dividends. That is the equivalent of at least $0.09 a share, enough for a yield of 5.8pc, and the higher the gold price goes, the more chance for higher profit, cash flow and dividend forecasts.
Centamin could yet regain its lustre.
https://www.telegraph.co.uk/investing/shares/questor-either-gold-price-miners-share-price-wrong-say-back/
Questor: either the gold price or this miner’s share price is wrong: we say back the miner
Questor share tip: Centamin has been a serial disappointment but even its curtailed targets for this year imply a yield of almost 6pc
Gold is hovering around the $1,900 an ounce mark, which means the precious metal’s price has risen by 55pc over the past five years and trades at barely 7pc below last autumn’s record high. By contrast, shares in Centamin, the gold miner, are no higher than they were in June 2016 and stand at barely half the peak reached last year. It is therefore tempting to argue that either the gold price or the share price is “wrong” – and given the current macroeconomic backdrop this column’s inclination is to believe that the share price is too low rather than the gold price too high, even allowing for Centamin’s history of operational disappointment.
America’s Federal Reserve, the Bank of Japan, the European Central Bank and the Bank of England are showing little or no inclination to tighten monetary policy. This is despite the fact that near-zero interest rates and quantitative easing were described as emergency policies when they were introduced in the West in 2008-09 and despite signs that inflation is gathering – last month’s 4.2pc year-on-year rise in the US consumer price index was the fastest rate of advance in more than a decade.
The central banks’ view is that this surge will be temporary because it is partly the result of pent-up demand and supply-chain dislocations as lockdowns ease and partly due to the low base for comparison offered by the economic downturn of 2020. That view may be right. But commodity prices are rising, factory gate prices are on the up and consumer price indices are surging. If wages start to rise sharply we could indeed be in a situation in which inflation is truly making its return after lying dormant for the thick end of 40 years. Real assets – commodities and property – or paper claims on real assets via shares in miners, for example, provided portfolio protection in the 1970s as the cost of living galloped higher, so those investors who do fear the return of inflation could be forgiven for researching gold miners such as Centamin once more. That said, those who see inflation as a transitory phenomenon will be unmoved.
1/2
https://uk.finance.yahoo.com/news/questor-either-gold-price-miner-160813454.html
very hard to understand who to believe because on 27th of May peel hunt targeted a SP of 150 P on contrary to Librium of 80 P.
I doubt that the Liberum clients will be sorry. After all, they caused a nice wave of FUD to allow them to exit their short.
As for the historical accuracy of Liberum forecasts generally? Ha bl**dy ha, one of the worst outfits around for pushing their book.
Hi Mr Bond,
Having been unfortunate or unwise to be sucked in by Logic investments in the past Liburam seem to be a very similar type of outfit, albeit more upmarket, but nevertheless less utter shysters in slick suits, who care not a jot about their unfortunate clients.
Most likely Liburam will be counting their commission's from last weeks sale of "Snake oil" and already contacting their clients about taking a new position on the next batch!
Tibbs
The numbers today make a nonsense of the forecast by the analysts from Liberium - I topped up when the price dropped last week - given their past track record - the experts from Liberium are not fit to tip dustbins!!!
It is shocking that people place so much weight on stupid babbling and caused the worry and panic on this bb.
Friday’s drop wiped out already, add in the divi and the drop is minor blip now
That's better news and with gold up then hoping for good week
Centamin PLC (06:02:10)
News: *BERENBERG RAISES CENTAMIN PRICE TARGET TO 132 (131) PENCE - 'BUY'
Gold now up $20 since Fridays close....
Equities in Europe traded mixed in the premarket on Tuesday ahead of several economic reports that are to be released during the day. Those include the latest data on the employment rate and manufacturing in Germany and the European Union. The United Kingdom will also unveil its latest results in the latter sector and in housing prices.
Earlier, the European Commission supported the European Medicines Agency's recommendation to approve the use of Pfizer Inc. and BioNTech SE's vaccine against COVID-19 in children aged between 12 and 15.
The DAX traded 0.40% higher at 8:00 am CET. At the same time, the CAC 40 advanced by 0.29%. On the other hand, the FTSE 100 dropped by 0.10%. The euro stood flat against the dollar, selling for $1.22239 at 7:57 am CET. A minute later, the pound sterling gained 0.12% against the greenback, changing hands for $1.42266.
Breaking the News / JR
Think yourself lucky you are not a client of Liburam.
Poor souls.
I assume AISC does go up but by the same proportion as the POG so margin is maintained....
From what I've been able to glean from the shock Broker target price of 80p published last week they are under no obligation to justify themselves other than some general observations. If this is not the case then apologies but I thought I would do my own back of a fag packet calculations to see what I came up with. Assumptions:
- price of gold to stay the same at it is over a 10 year period when expressed in GDP deflated $. I.e. it maintains its real value when measure against USD
- AISC is at 1400 $/oz and stays that way over the life of mine
- life of mine 10 years
- only published reserves of 5m exploited no further gold at Sakuri exploited
- no further exploration expenditure since resources not converted into reserves
- break up balance sheet value is $400m based on intangibles and plant having zero value at end of mine life
- the west african prospect is realistic based on high discount factors.
First we have break up value of $400m
Next we have 5m oz at AISC margin of 450/500. Given the 45/55 split let's allocated $200 oz of CEY. Multiply by 5m reserves gives you $1b
Add in the west African prospect which, depending on assumptions, is worth 300-500m - take the median - $400,
Thus 400m plus 1b plus 400m gives 1.8billion or ~ 150p per share. Not a million miles away from other broker estimates
So what assumptions did the rogue broker use? POG? - in which case all miners are impacted. AISC - the 1400 figure I use is pretty steep already. Do they have such a low opinion of the new management to deliver. Reserves ? What inside information to they know that nobody else does?
Perhaps I have missed something obvious.?
Suggestions on a postcard gratefully received ...
This what we'll have to do, we all have a choice, GLA ;-)
I’m personally make very happy reading regarding the project news on the last RNS, especially Doropo adding potentially another 200,000 ounces annually. I also believe it was a case of the sell on news brigade along with the ridiculous 82p broker note that contributed to the excessive drop & panic selling.
When a decent RNS lands on any company I’ve seen many a time that the sp will sell off....only to recover again quickly a week or so later, I believe this will be the case with CEY.
7 Wall Street analysts have issued ratings and price targets for Centamin in the last 12 months. Their average twelve-month price target is GBX 153.29 The high price target for CEY is GBX 240 and the low price target for CEY is GBX 82. There are currently 1 sell rating, 1 hold rating and 5 buy ratings for the stock, resulting in a consensus rating of "Buy."