Good afternoon
Equities manage to shrugg of prospects of a new escalation re Hongkong…Europe is a litlle weaker, but the US markets are up a touch, especially Nasdaq.
US PMI is continuing to rebound….
FedEx with a stellar Quarterly - indicating very strong e-commerce activity, but at least partially also profiting from company-specific issues. Australian companies like Marley Spoon should continue to do well, but also German entities like Hellofresh, Zalando or Westwing. Amazon makes a new all time high today - I guess on the back of the FedEx result. Same for Apple and Microsoft…the music never stops!?
Gold is under a bit of pressure today from profit-taking…the unsuccesfull attempt to move through 1800 US$ possibly triggered some selling, and inflows into gold ETF´s have been a bit slower over the last few days than recently. But the GDXJ is holding up relatively well for now.
Evolution - have completed the sale of the Cracow Gold Mine in Queensland. They will have more time now to look at the rejuvenation of their new Canadian asset, and the expansion of Cowal! Both are looking very good, and in the absence of aquisitions, should give EVN some growth in 2021 and 2022. jake has proven himself as one of teh smartest M&A managers in the past, and I think we can be assured, that he will stick to his mantra: Being a profitable gold miner throughout the cycle! I think this will certainly prevent him from buying anything for growth´sake!
Tietto - broker Hartleys today increased it´s target to 75ct, using some very conservative assumptions: Firstly, a very high discount rate of 14% ( which I think is very prudent, but much higher than generally being used ), but also 91% recovery, which is extremely conservative, when looking at their metallurgical results so far,which indicated at least 96% recovery. You can imagine, that 5% extra production at zero cost makes a big difference to earnings and the NPV! The drilling program is making very good progress, and I think we might have a new resource estimate within 2 month, and possibly, the results from a pre-feasibility study by January with a bit of luck! The results will enable analysts to put a proper valuation and targets on the stock, which I think might well be quite a bit higher! I continue to like this story!
Genex - the Northern Australian Infrstaructur Fund as well as other participants in the financing extended their offers to the 30th of September. The sale of some equity in the hydro-project is making good progress as well to make sure, that the target of financial close by the end of September can be met. I will comment in more detail tomorrow.
Technolgy Metals - the company increased the vanadium resource of their Gabanintha Project in WA by 32%. The project had a final feasibility study completed on it a few month ago, which indicated a mine life of 16 years. TMT have signed a few MOU´s with credible partners for offtakes over the last few month and now has the daunting task, to find approx 500 mill $ to bring the project into production! It sounds absolutely impossible for a small company like them - but these days, institutions like the Northern Australian Infarstructur Fund can be of big help, as tehy underwrite big licks of capital, at very favourable interest rates, as subordinated loans and over long time frames. For this latter reason, a longer mine life could be very positive for the project. As impossible as it sounds - if they find a suitable offtaker, which also takes some equity in the project, tehy might actually be able to get the financing done. but firstly, we need a better vanadium prices, which seems a distinct possibility. No major hurry to buy TMT - but it´s an interesting stock well worth following! I own a very small position in TMT.
Have a nice evening
WS
WS
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