Member Info for the_shareminator

I see it as a blip in what has been and will continue to be a very strong trend higher :)

Better buy than H&T in my view

Might I suggest we all focus on the positives and ignore spurious claims made by a new member (10 Aug).

Shareholder support here is stronger than that.

I'm also holding SLP and that has fallen back form 55/56p despite strengthening PM prices. In fact most of my gold holdings fell late last week as the gold price trimmed $25-30 off recent highs. So I would not be too concerned. Even if precious metals remain flat this quarter, margins for nearly all will be some of the largest in almost a decade.

Traders taking profits today will I believe, struggle to find better value tomorrow. Specifically PM producing miners. My strategy is to bide my time and sit on hands for the foreseeable. If opportunities arise to buy something better valued (SLP possibly being one) then i'll fiddle with my portfolio. As it happens anyway SLP is one of my largest holdings, AAZ is another :)

They recently followed little old me on Twitter, part of their expanding social media presence, but for what purpose I am not sure. I can only imagine they will continue to pick off cheap assets from listed companies, whose stock they may well hold OR they intend to list via IPO in the near future.

I haven't checked but most listed companies sell their gold for USD. Even CMCL which is subject to currency restrictions in Zimbabwe (if memory serves) so the Brazilian Real falling or remaining low is not a bad thing. The company actually make savings on operating costs and capital expenditure from within Brazil.

The market has for a while now been ignoring the rising gold price. Futures are $2060 today and expected to touch $2300 in the next 12 months. Quite why there hasn't been any interest here suggests to me the macro economic is having an overbearing effect on the stock price. This was ongoing prior to the somewhat mixed Q2 results.

The outlook for Q3 is much the same for Q2 albeit at higher gold prices. As more of Serabi's workforce returns to work they will close the gap from 85% of production to 100% in line with forecasts by the beginning of Q4. I think 9koz is achievable and come the final quarter, SRB are expected to yield 10koz possibly more with efficiencies being put in place.

The market has not priced in SRB meeting top end guidance 34k-37k ounces or exceeding this target IMO nd given the current political treatment of the pandemic it's little wonder. I happen to think so long as Covid cases and death start to fall in the coming weeks the risk will diminish and buyers will begin to price in 18-20koz second half output, $36-40m, no more loan repayments, falling cash and group costs compared to H1 and a rising cash pile.

HUM and CORA both down today, could be risk factor having an effect. Don't believe the underlying dangers associated with this risk have heightened but news today might well shake the risk averse out.

https://www.aljazeera.com/news/2020/08/mali-soldiers-killed-rebels-heightened-political-crisis-200803060158897.html

Beginning to rise now.

Would not touch GPSS due to the complicated nature of the set up. GPM offers a safe means of exposure to a wider portfolio of gold and silver producers and explorers, the most interesting of which are listed on foreign exchanges. There is no reason why GPM won't put on 30-40% by Christmas from current levels if gold continues to build above $2,000/oz. I expect there to be occasional pullbacks, probably during mid quarter and stronger gains around the end of October and January.

I added SRB to my PF today in anticipation of Covid cases flattening in the next week or two. Worst case, bought too early and will be locked in at 90p but not such a bad thing with gold trading at $2,000/oz and second half forecast to be better in terms of output and margins. Also holding AAZ, CEY, HUM, TSG, RSG, HOC, SHG, GPM, CGH, AAU, GFM, CNR, CORA for maximum exposure :)

Anyone figure out why cashburn is £125k per month?

Not holding FSTA but I hold RTN, MAB and MARS. I'm not sure why there hasn't been more support as pubs reopen, especially against wider sector support recently. As always, avoid trying to catch a falling knife and wait for sellers to clear, regardless of value on offer. All the best!

https://www.investorschronicle.co.uk/shares/2020/07/30/coronavirus-blows-10m-hole-in-fuller-s-trading/

If a rights issue is guaranteed now then no point holding here. Petropavlovsk fell from 300p all the way down to 20p before a rights issue was agreed.. at 5p, screwing any shareholders who didn't have the spare cash to take up the offer. Not saying this is as dodgy but I don't a floor here until details of the RI are shared.

Nice value on offer at current price. Didn't see anything in the update that warranted a 10%+ fall on top of recent weakness.

When STEL was swallowed up by NWF shareholders did not get a vote and many including myself felt robbed. Thankfully we received stock in NWF and I was able to later sell at a premium to the takeover price. This is different of course, I view this as a hostile undertaking with dodgy board backing that makes absolutely no sense with the gold price a couple dollars of $2k/oz.

I think it's highly likely the deal will succeed at this point.

continued...

It now has a portfolio of long-term mine-site based contracts with some of the world’s leading mining companies.

Now focussing on West Africa
Focussing on the African markets the group’s customer list includes Barrick, BHP, Hummingbird Resources, Kinross, Glencore, Antofagasta Minerals, AngloGold Ashanti, Perseus Mining, Altus Strategies, Centamin, Resolute Mining, First Quantum Minerals, Allied Gold Corp, and Rio Tinto amongst others.

Some 96% of the group’s revenues are derived primarily from Tier 1 and Mid-Tier clients. Around 77% of its revenue is through production and underground mining, which is less exposed to fluctuation in the mining cycle.

Mining juniors are raising more finance now that the price is so much higher
Current gold prices have been providing a highly supportive environment for increased activity levels in exploration and delineation drilling. Furthermore, junior and intermediate explorers have been more active in seeking additional financing for expanding their activities as the gold price rises and makes it even more attractive to do so.

It is believed that this should help to create more business in the second half of this trading year, especially following the easing of travel restrictions together with the end of the wet season in West Africa, which is where Capital is intensifying its operations.

Trading update was bullish
In the middle of July, the group issued a trading update for the six months to end-June. They suggested that revenue was up 18.8% at $65.1m.

For the full year estimates imply that $135m is possible and then up to $150m next year. Pre-tax profits are likely to be around $15m this year and $17m next year.

More business contracts soon?
An increase in contracts awarded in the coming months will be beneficial for next year’s results. They could also get another boost from a rise in the values of the group’s listed and unlisted equity portfolio of companies with whom it is in business.

Brokers upping price objectives
Last week broker Peel Hunt increased its price objective to 85p a share. Mining finance boutique Tamesis Partners is even more bullish about Capital’s prospects and has set its cap at 100p a share.

Regular readers of my profiles will already know how keen I am on the company, its service offer, its markets and its massive prospects. I have had a 100p target price on the shares since late last October.

A great way to join in the golden fun
As the price of gold, waivers around the $1,980 market, it is attracting so much more of a following and so too the companies that participate in its mining activities.

I really do consider that Capital is an excellent way of joining in the fun.

It is an exciting ‘pick and shovel gold play’ not to be missed, especially with its interims due in just over a fortnight’s time.

Its financials are strong, its potential is significant, and it is an easy task for its shares to move ahead and break through

Try this ‘pick-and-shovel’ play as the price of gold goes through the roof

Capital generates some 90% plus of its revenues from supplying the gold mining companies and looks set to capitalise on the gold boom, writes Mark Watson-Mitchell.

A ‘pick-and-shovel’ play is an investment strategy that invests in the underlying technology needed to produce a good or service instead of in the final output. It is a way to invest in an industry without having to endure the risks of the market for the final product.

An example was Levi Strauss, who made his money in the California Gold Rush, not by digging away but instead by supplying very wearable and hardy trousers for the miners to wear as they toiled away.

Hardware suppliers in the Gold Rush made fortunes by providing picks and shovels and other basic equipment for those seeking out their fortunes.

An excellent way of playing the gold market
And this ‘play’ is one of my old favourites. Capital (LON:CAPD) generates some 90% plus of its revenues from supplying the gold mining companies, especially in Africa, with their drilling services.

It really is an excellent way of playing the gold market as the yellow metal drives even higher in price.

With forecasters across the globe pronouncing an even greater rise in the gold price in the near future, it is becoming evident that more mining companies are now looking to prospect previously neglected properties.

Interim results due in a fortnight
Capital will be announcing its interim results on Thursday 20 August and its shares could then become a more active counter. One broking house late last week upped its price objective for the stock.

From initial first stage exploration drilling to ‘load and haul’ of the ore to the mill, this group’s services extend across the mining cycle providing a fully integrated mining services solution.

It operates one of the youngest rig fleets in the industry, with its most recently recorded average fleet size numbering 99 rigs. It includes diamond core rigs, air core rigs, reverse circulation and grade control rigs, blast hole rigs, as well as underground rigs.

Not just drilling rigs but more
In addition, its heavy mining equipment fleet is growing rapidly with the recent acquisition of bulldozers, dump trucks and mining shovels.

It operates an extremely efficient maintenance team, helping to ensure optimisation of its working assets.

In addition to its exploration and underground drilling services, the group offers geochemical analysis laboratory services, together with software and tool rental.

Wide geographical experience
The Mauritius-based group has established infrastructure in Botswana, Burkina Faso, Cote d’Ivoire, Egypt, Mali, Mauritania, Namibia, Nigeria and Tanzania.

As it is now transitioning its operations into that of a full-service mining house its client list is building up.

https://masterinvestor.co.uk/equities/try-this-pick-and-shovel-play-as-the-price-of-gold-g

The majors are making new highs daily despite COVID difficulties, even debt laden KAZ is in an upwards trend. This producer is lagging in the same way AAZ (gold + copper) was lagging in the 120-130 range for weeks. It's up about 30% in the past fortnight, a somewhat delayed reaction. CAML has a good bit of climbing to do to catch up with sector gains.
GLA

Ridiculous deal for the directors to agree to.

This deal comes roughly a month after Fortiana soldtheir stake of about 5% in London listed Petropavlovsk Plc, another Russian gold miner locked in a boardroom battle. At the time Fortiana said selling that interest gave the company cash to pursue other investment opportunities.

The question is why have our board of directors accepted this deal? What do they stand to gain letting HGM go less than 6 months into the current gold bull market...

Sad to say I see this as more a play on Brazil kicking Covid and returning to normal than a gold producing play at the moment. Despite ever improving gold related fundamentals the share price has barely moved. The same thing happened with the Russian producers a month or so back. Happened with Peruvian silver miner HOC also. The stocks I'm referring to have since risen considerably as the perceived risk has deminished for now. Once Brazil is over the worst of Covid I expect interest will return here.