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dim, having been vocally scathing of DB on here previously, I can honestly say that they have done well this quarter. It was the wet season which combined with logistical issues arising from CV19 and the coup and yet they still produced a creditable no. of ounces. The cost went up, but we should see that drop on Q4 and more so in 2021. They're at net cash now (extrapolating to end of Oct) and will easily be able to fund their expansion to 230k oz from cash flow and a modest amount of new debt (say $60m). Plus, it looks very likely that a sizable extension to the LOM is on the cards in the Yanfolila area. Nice to see a reasonable sale price was achieved for Q3 - most unusual for HUM and hopefully it stays that way going forwards.
AISC too high. Its a bit ridiculous how wild the swings in this are. Covid doesn't excuse its increase. Production is not what investors thought it would be and low and behold, more excuses from management.
Don't worry though there will be Jam tomorrow. I am glad to be out again. You can trade this, but I would never hold this to be a multi bagger anymore. Its a shame.
I feel Dan is a bit of a magician. Some might say con artist, others might say he stretches the truth or plays games with smoke and mirrors. But i would say Dan is one of the major reasons for the lack of interest in this share.
Q3 Report was definitely a mixed bag with the high and unwelcome AISC, but this was more than offset by the rise in realised gold/oz. I am guessing the market 'fears' is that the high AISC is now nailed on going forward.
I have been through several other Gold producing companies trying to assess what would be fair value for HUM and used an EV/Gold Equivalent Ounce produced metric I made up so I could compare apples with bananas and HUM seems to be at a serious 20-30% discount to other small and mid-tier producers.
On the plus side if you are buying HUM it should give you some comfort as its debt continues to fall, the AISC drops back down and other assets come onstream. HUM looks setup for a blistering 2021
AIMHO APR
So HUM is cheap - too cheap. Fundamentally no question. BUT question is why market does not rerate - what is it that holds HUM back??
For all the chat on the reasons why Q3 excuses are valid - Dan B and team always surprise the market with these excuses on results day. Other management teams, keep shareholders up on events by managing expectations - Dan should have put out a release during Q3 to say AISC would be ahead of prior guidance due to heavy rain and border issues etc. No problem - its reality.
BUT..........the market sees that Dan never does this, and this lack of transparency is what holds HUM back - investors dont like surprises, it breeds suspicion - which means market discounts the NAV. This is 100% the reason why HUM trades at a big discount - despite all the fundamentals - IIs and many PIs dont trust Dan B enough to pay fair value for the shares.
This aint rocket science - its how markets work i.e. discounting "risk" adjusted forward cashflows.
i'am not happy with the 1200$ AISC but there was a terrible wet season, borders closed , Mali in trouble, Covid-19 .... now we are 4 weeks in Q4 and dry session has started, costs will come down ... drill results are good, our next projext seems to be on track ... net debt zero ... HUM is far too cheap now... look at this laughable marketcap ... this becomes a 2 1/2 mine-company very soon funded mostly from internal cashflow...
HUM has had a difficult period of time, to navigate through,......I'm certainly not disappointed with these results & now the wet season is behind us, with the gold price outlook, Q4 should be good,.....not here for short term s/p myself, here for organic growth outlook for HUM & where I believe the gold price will be 2022/2023 onwards.
A couple of good interviews today:
https://youtu.be/E51eZT5nKII
https://www.**********.co.uk/articles/dan-betts-ceo-of-hummingbird-resources-and-alan-green-on-3-stocks-299dc48/ (you will probably have to copy & paste this link).
BW
It's as TBTT said this morning; this is too cheap for what they've got now, too cheap by far.
sorry about repeated post.
goto
voxmarket web page and paste the link.
www.**********.co.uk/articles/dan-betts-ceo-of-hummingbird-resources-and-alan-green-on-3-stocks-299dc48/
https://www.**********.co.uk/articles/dan-betts-ceo-of-hummingbird-resources-and-alan-green-on-3-stocks-299dc48/
**********
https://www.**********.co.uk/articles/dan-betts-ceo-of-hummingbird-resources-and-alan-green-on-3-stocks-299dc48/
CEO interview
Yes I take your point about the whole company being more transactionally based than investment based. This is one of the crying shames about Covid. Not being able to meet the BoD eye to eye and determine whether they are capable of change now through a combination of smart deals and luck they have got themselves a reasonable portfolio of assets. I'm definitely sticking on this one until I get a better steer - for better of worse.
SHG - ah yes! I've been quite an active contributor to that Board and I won't take up space repeating my arguments. Suffice to say Erin and Co look a better bet than Dan and Associates but, I'm not very happy about the tax jurisdiction they operate in. I may be paranoid but I cannot forget Acacia's demise. Stuff like the ongoing VAT issue and the upcoming tax audit are a bid concern. Also Erin & co are not perfect either. Maybe it's a quibble but I can't find any provision in the accounts for a VAT provision and they're jolly well should be given it's been nearly a year since they got back any rebates. Also the announcement of a placing caught a lot of people on the hop.
Have you looked at CMCL? Zimbabwe is not the best of places but they have a very nice long term asset there and they pay dividends. I have a small holding btw
If you have followed this company since 2014, which I have, there is an underlying pulse to Dan B and his management team. 1), the BoD is not really independent enough and target options packages egregious. 2) Dan, as an ex broker, is more aligned with booking commissions that building value. HUM is in a perpetual state of risk, which Dan never really deals with - i.e. there is always some issue to derisk - he doesnt know how to use value and perception of value to build the company, hence he always on back foot, eg BH, ACG, Dugbe, AISC issues, 3) Management never communicate with the market except at quarterly announcements - this shows disdain for shareholders and again he is a novice CEO. He should be setting targets that he can beat and show momentum, instead there is nothing until results are issued.
Taken as a whole, the equity mrk is a discounting tool, and Dan has impaired the forward expectations with risk and expectations of unknowns. Hence SP will never represent true value with him in charge. This is a opinion, but born out by discount to FV of the company. For me I'm move most of my HUM into Shanta, where management have changed approach for the better.
@fsj - you wanta show me a bid for my stock?
Thanks Dropmonkey although I'm not quite so downbeat on the management as you. I view it rather as a Faustian deal. The opportunities in small AIM miners such as HUM can be outstanding but they always get to get first dibs as the returns. Although not crumbs ordinary shareholders are second best. Having said that the situation ain't so difference in many other sectors of the investment world either.
I'm curious what goldy management teams teams stick out for you? I don't see any outstanding examples with the possible exception of AAZ. Bear in mind I only cover UK stocks.
Bye bye monkey.....don't let the door hit you on the way out.....
Well I guess investors should have expected some collateral damage due to the military coup, though the excessive rainfall was news to me. There's always something with HUM. $8m less cash generated compared to a "normal quarter", i.e. if AISC had been $1000, which is disappointing. Stlll, it's mostly behind us now so, as they say in football - poor result, we put it right, we go again.
Kudavul - gold explorers cannot stand still. They have to explore new areas to replace depleted reserves. They also have to build in resilience to the mining plan by having more mining faces than they would normally work in case a problem arises on an active face. This gives them resilience, something that the wallies in CEY haven't done!
In other words expenditure such as you mention are not optional extras, they are an integral part of operational costings.
It's not hard to see now a curates egg of an RNS can result in a 5% drop in the share price when punters such as yourself take all the promises management make without question or challenge.
Actions speak louder than words. HUM are not all talk and no action but nore is their operation a seamless well oiled predictable machine. Yet!
@adamsmith - this is spot on.
We have never had a blow out quarter that beat market expectations for HUM - there is always something of a neg surprise, even if that was the right thing to do, i.e. capex into Kouroussa.
This is symptomatic of HUM - and it always seems to favour the insiders, ie management and directors.
I think any hope of Dan B and crew playing for shareholders is now confirmed to the dustbin. Now, HUM is still undervalued, but I think it will continue to trade at a discount. The curtain will only ever be pulled open if the gold price puked - ergo its still a trading stock, but will always leave a sour taste for investor due to Dan's ego and awful management skills of a listed company. Time to plan to top tick and exit for better management teams in gold space.
adamsmithfreethi
HUM have already started to finance 5 Million into future exploration.
"US$5 million was spent on other items including: exploration programmes, expansionary capex ; and preliminary pre-development costs at the Kouroussa Gold Project in Guinea ("Kouroussa")"
If it isn't for that then it will be 4 Million surplus. The report is still not fully explained in details specially the Bunker Hill mining investment but I believe now we should hold above 5%.
With holdings in Pasofino 49%, Cora 11.36% and Bunker Hill 5%+ HUM is very much undervalued.
Punter in what sense is it a shocker?
Cheers Punter - another incisive comment full of objective views backed by copious facts. Fraid you ain't shaken my tree yet!
However, this RNS presents us with the very much a glass half full/empty conundrum.
Personally, I'm going with the half full particularly now their essentially debt free status gives them optionality in what they do next and how they finance it.
However, I want to see clear operational efficiencies before I resume any degree of enthusiasm for this company. They made some general comments about doing this at the end of the RNS. I would be nice to see these actioned.
As with other goldies e..g CEY there is a danger of getting fat and lazy on an elevated gold price.
This only suits the managers and workers not us the shareholders!
Decent update. Almost debt free if you include inventory as highlighted by BoD. Stronger period in play now. Happy to hold and add. We'll see some strong exploation updates Bod have literally stated their exicted about these.
Another shocker! HUM never fails to disappoint.
Typical, really good RNS and the share price goes down. I don't believe it Hummingbird has done everything right in difficult times and continues to motor on, then you get some on here continually *****ing about not enough progress, it just beggars belief.