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Having said all this, I do believe that Boatman has been unfairly vilified. Read their report. It seems to be quite rational and reasonable. They do not try to run down Thungela per se and are very critical of Anglo American for apparently greenwashing and dodging their obligation to clean up the environmental damage caused by themselves. And based on the best knowledge on the coal market at the time, coal prices did not look like exceeding $100/ton ever - at these prices, Thungela was basically never going to accumulate funds for mine end-of-life rehabilitation and would most likely have had to declare bankruptcy. On a brief reading, I am impressed with the report ............ and glad that it is currently so wrong!!!!
CloudyMountain : You're welcome. I have only found two references about Boatman : the report they wrote in June last year :
https://theboatmancapital.com/wp-content/uploads/2021/06/Thungela-Resources-Report-6-June-2021.pdf
and the update in June this year. To give them credit, the Ukraine invasion had not kicked off yet in June 2021 and a lot of others thought that Thungela was going to implode at the time. This share came onto my radar at 185 and I also initially thought "Seriously? Coal?" ........ then only jumped in on FOMO when it peaked at 500 in October last year. I'm not complaining(!), but I do still dream of what could have been if I'd got in at 185 :)
@pop31 I’m grateful for the two links. I actually wondered if your first one (yesterday’s) was by someone else and not Boatman Capital as it was such a U-turn.
Re your second link, opening paragraph: “When Anglo American spun off its coal arm to form Thungela Resources last June, no one could have predicted that the taboo energy source would make a comeback”. A number of people on here would disagree! It’s funny seeing them trying to justify their U-turn.
0777brad : :D :D No guarantees, but let's hope so. I know dividends may be juicy, but I wouldn't mind a significant boost to the base capital value of my shares .......... :)
0777brad : :D :D No guarantees, but let's hope so. I know dividends may be juicy, but I wouldn't mind a significant boost to the base capital value of my shares .......... :)
CloudyMountain : I know. Boatman even re-iterated their position in June 2022, stating that investors should not get excited about Thungela's meteoric rise, that the good times won't last and that the money put away for environmental cleanup is still nowhere near enough .........
https://www.thisismoney.co.uk/money/investing/article-10952637/STOCKS-WATCH-Boatman-blasts-Thungelas-coal-comeback.html
Just giving a balanced view. There are negative views on Thungela out there. :)
Personally, looking at the outlook and the cash being printed by Thungela at the moment, I believe it will take a huge event to reverse their short-to-medium term rise. There will be ups and downs (this is a volatile share, essentially based on a single commodity .....), but short-term, the prospects really look rosy. Longer-term, we'll have to see .......
Summer sale ends today at 4.30
Yes happy to hold for another year at least, coal ban on Russian coal just gone through oil ban happening end of year high prises are here to stay for now and if dividend keeps increasing and cash is flowing into the company no reason to sell at these prices just have to wait for results to judge the shares fully.
Boatman Capital is the one that said, in June 2021, that TGA shares were worthless! They were £1.50 then.
https://www.proactiveinvestors.co.uk/companies/amp/news/951530
https://theboatmancapital.com/2021/06/02/thungela-resources-ltd-drowning-in-liabilities/
There can’t be many £2Bn companies with such an easy to describe business. They dig up coal in South Africa, transport it by rail to the coastal port and sell it to buyers who transport it away on ships.
In theory a fairly straightforward thing to analyse.
1. Mining operations (costs, weather, staff, politics)
2. Rail operations (we’ve all heard about the Transnet woes)
3. Port operations (thanks to whoever updates on the marine traffic)
4. Price of coal.
5. Decommissioning costs at end of pit life (I think the piggy bank was topped up for this already).
The non SA tax take means I only get 80% of the dividend here in my UK ISA, which is a negative, but I tell myself that the tax is my contribution to levelling up.
I’m holding until I think the company is widely enough recognised to give it a fair value one way or the other.
A full year dividend history should work wonders with the visibility if it’s as high as I expect.
atb
Linked to how high (or low) can Thungela go, I found a podcast at the website below:
https://www.moneyweb.co.za/moneyweb-podcasts/moneyweb-now/top-story-thungela-lesson-how-to-spot-a-mispriced-share/
There should be a fair bit of research you can do yourself . Quick search yielded the attached analyst opinion, as of 2 Aug 2022 (he may be biased, but that's why you do some digging, right? Check Boatman Capital, for example, and take your own view .....).
"Anglo’s folly – Thungela from R25 to R290 in a year, still cheap
In June last year, Anglo American caved to shareholder pressure on ESG by completing the de-coupling of its South African coal assets. The new company, Thungela Resources, traded life at R25 a share. Anglo’s large foreign shareholding base dumped their allocations as quickly as they received them.
Yesterday Thungela issued a trading update disclosing it had earned R67 a share in the six months to end June. Annualised, that’s R135 a share – in a single year, five times the price at which Anglo rid itself of the supposed millstone.
In the investment world, following fashion is rarely a smart call. This one, taken by handsomely remunerated London-based managers, has to rank among the worst ever by any South African company. Even now, with Thungela’s shares more than 10x the price at which it was abandoned by its former parent, they look appealing."
Thesurvivor7 : I kind-of agree with ShearClass here - it does sound odd that you have bought and then soon after, are questioning your purchase and fearing the price could tank because it's already been a multibagger. Why did you invest, then, and not hold back until you got more info?
Maybe you can share some other insights you have about Thungela, so that comments/advice will be appropriate? At the moment, it does seem like you have jumped in because of FOMO ..........
But if coal takes a sudden drop.. This will tank that's why I'm abit nervous... Having multi bagged
I bought in because coal is still at very high prices, plus a big dividend could be coming.
I'm very happy. Mostly bought in the £2s and £3s, now my 2nd largest holding (after Berkshire Hathaway).
Potential eps of £9 or more, divi could easily be 20% or even much more.
I'm expecting this to double (or more) in the next year, possibly less if coal prices remain stratospheric, and if they sort out the Transnet mess.
Extremely comfortable, hilarious that you don’t seem to have a clue why you’ve bought - do some research!
I'm new to this stock... It has had a fantastic rise this year.. But where is the top? I bout at 1347, so I feel I'm in at a high price considering this has multi bagged. I read a article on bloomberg saying Russia disruption Could keep coal price high for years... Just like some feed back please.