Disclosure: Financial Investigative Media Limited, which is not owned by Tom Winnifrith but by a trust for his dependants, owns shares in companies mentioned in this article. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
You have, by now, read my macro calls for 2016 which you may or may not have dismissed as complete mumbo jumbo but I hope they make sense. You will see that I expect the gold price to pick up during the next 12 months. Not to rocket but to improve and that makes Petropavlovsk (POG) at a 6.7p offer a very obvious first tip of the year.
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Comments
Inforapenny
Tom
Just wanted to query your statement re IRC
There have been a few stories circulating about its financial situation and suggesting that POG could be on the hook for big money (up to $300m) , if it were to get into trouble…
You saying you believe that the IRC situation is not serious, or that POG is unlikely to be affected?
Am sure that your info is better than mine – would be grateful if you could address the IRC issue in more detail
Cheers
Banabob
Tom
You’ve lost the plot on this one. It’s barge pole stock with a shit board of directors to boot who sat around doing fuck all while their company collapsed around them and waiting til the bitter end to do a placing thus wiping out loyal shareholders who had stuck by them with massive dilution.
To say that the IRC problem is manageable is monumental bollocks of the highest order. In a nut shell Pog are on the hook for massive loans concerning that company, incidently run by his son, blood is most definatley thicker than water in this family so I would expect more lambs to the slaughter should this go tits up and unless iron ore makes a remarkable recovery next year it surely will leaving Pog to pick up a very big tab
I wouldn’t touch it with yours
Hope Christmas went well and happy new year
alcira16247
Tom
I think your correct predicting a rising gold price running through 2016.
This year has seen turmoil in the bonds market – whether Government, Corporate or Private Retail – the outfall of redemptions has run into the tens of trillions.
As many classes of assets look fully priced, classic cars, rare painting, property, equity markets or WHY and as investors confidence seems more ever more fragile , how long is going to be before substantial sums start to flow into the traditional haven of safety – GOLD?
Recently, three medium tier producers have caught my eye, all three have their problems, but interesting to note, all three have started to show significant movement.
50 day and 200 day moving averages breached – raising momentums and value ratings according to Stockopedia.
Petropavlovsk (POG) – Centamin (CEY) – Highland Gold Mining (HGM)
Eyeguy
Tom.
Surely if you are bullish on gold, the most under prices of all is Kefi minerals.
From latest RNS:
Free cash flow is US$25-37 million per annum – based on average cash available for equity holders, after servicing commitments including debt and gold stream.
This is surely under valued by a factor of 10 based on the same assumptions you use for Pog.
I’m loading up in there
Tom Winnifrith
Eyeguy
POG already in production and a buy at current gold price. Kefi not there yet. I argue that if gold recovers which it should POG even cheaper. That does not make me a gold bull. As it happens we own a few Kefi as well but think POG cheaper
T
eyeguy
Tom.
We will see obviously but for me Kefi does seem ludicrously cheap, which IMO is mainly due to standard life dumping all their shares over a few months and possibly because Odey’s have set the floor.
Interesting that standard life sold heavily into the recent news that the Ethiopian government are chucking $15-20 million in for a stake, which values tulu kapi at circa $75 million at this stage.
I think this stock could be pushing a penny within 3 months based on the above facts, and if the finance arrangements are concluded.
Currently the mcap of kefi is circa 10% of kefi’s share of the project NPV so this IMO is far too low.
So yes, not producing and more risk with this, but likely for some big gains within months.
We will see