Good afternoon
Equities in Europe have been trading stronger all day - closing now still in the green, while Wall Street is undecided where to go.Base metals are quiet except for Zinc, which is up by 1,5% . Little action only in gold as well.
Powell wants to see more government support, putting some pressure on the two parties to agree on something.
Trump feels great - well he certainly looks really sexy!
so we are back in a real investment-bankers world in the gold space! Northern Star is merging with Saracen! Big party for lawyers, bankers etc, I am sure, to create a 16 bill A$ company. Is bigger better? Well, the market said yes today - I personally very much doubt that! But I have to admit one thing: For large funds to have a meaningful waiting these days, a stock like Evolution is still to small to deal in! If you want to invest say 500 mill US$ into EVN, it would take you probably take you 100 trading days ( at 10% of turnover/day ) to buy the stock…This is the only reason I can see for people to say: Bigger is better!
But certainly it makes growing the company, and generating superior returns after the initial rerating, much more difficult - and management does not become easier, either….I guess there will definitely be synergies - both own 50% of the Golden Mile, and they are neighbours in Kalgoorlie - but managing such a beast and find ways also requires planning people. So I doubt the number tehy are quoting, which is 1.5-2 bill A$, and which is equivalent to the increase in market cap today ( while the number quoted will be saved over the next 10 years or so! )
So let´s wait and see what comes out of this - for now, it does create some excitement and further appetite for corporate action, I guess. I think it might have started with Bellevue today, which was up strongly and is in the neighbourhood to NST and SAR!
Dacian - came out with promising pre-Quarterly today: Production of 32.800 oz in the Quarter, vs guidance of 110-120.000 oz for the financial year. The quarter included a few oz form the underground, which has been closed dwn. Still, a strong number. Net debt is zero currently, and it looks like they generated 6 mill A$ in cash despite heavily delivering into forwards. 61.500 oz of hedging are left - by the end of this financial year, they will be gone. The key to Dacian is an increase of mine life via a new underground plan, or preferrably, by exploration success. Nothing for this would be in the share price, in my opinion….we will get further info about costs etc once the full Quarterly has been announced!
Chalice - and yet anotehr fantastic round of drilling, extending the resource and indications are, that the deepest hole yet has found teh right mineralisation as well. The same kind of PD/Pt/Cu/Ni/gold results , with soem very long intersections of up to 35m from step-out drilling ( 2.1g Pd/0,5g Pt/ 0,2% Ni/0,5% Cu and o,2 g gold ) / in another hole, 45m with 3,2g Pd/1,2g Pt/0,4% Ni and 0,3% Cu are certainly fantastic and gave the stock all reason to close at a new alltime high today! I hope, that metallurgical testing will be promising as well - if yes, this stock could go higher! I am still a shareholder for my fund. Again, Congrats to Tim Goyder and Alex Dorsch!
Have a nice evening
WS
WS