|African Barrick Gold
||EPS - Basic
||Market Cap (m)
Real-Time news about African Barr (London Stock Exchange): 0 recent articles
|hectorp: addison, they seem to have turned the business around. The rise is therefore not too surprising. But, if I had the ability, I could see if this suggested a much higher share price.. I've only done basic arithmetic, there should now be more upside methinks.|
|mechanical trader: Canaccord sees buying opportunity at African Barrick Gold after sell-off
12 March 2014 11:24
The 17 per cent share price slump of African Barrick Gold (ABG) has created a buying opportunity, according to Canaccord Genuity on Wednesday.
The broker kept a 'buy' recommendation and 315p target price for ABG.
Shares fell sharply on Tuesday after parent company Barrick Gold disposed of 41m shares - representing a 10% stake - to lower its holding to 63.9%.
"We believe the magnitude of the price drop was exacerbated by the profit taking following the best performance among UK peers since mid-2013. The fall we think opens up a buying opportunity," said analysts Dmitry Kalachev and Peter Mallin-Jones.
Among their key reasons to buy the stock, the analysts highlighted free cashflow (FCF) which is expected to average $230m per annum between 2015 and 2020.
This translates into a FCF yield of 13% which is the highest among ABG's London-listed peers under Canaccord's coverage. Adding growth projects would see FCF rise to $280m per annum at a 16% yield.
They also pointed to a robust balance sheet, strong production growth and easing upwards pressure on costs.
Addressing recent speculation that Barrick Gold could move to sell-down its remaining stake, Kalachev and Mallin-Jones said ABG now represents only 7% of the parent company's annual production so even a total disposal of the entire 63.9% stake will improve Barrick's costs by only around 2%.
"The sale at any cost in order to improve cost profile looks out of the question and this, we think, reduces the overhang risk from the remaining stake," they said.
The stock, which hit a low of 229.3p in early trading on Wednesday, had trimmed losses to trade just 1.4% down at 246.5p by 11:45.
Related Companies: ABG|
|bobsidian: Probably when the share price has been moved back down to test the 200 day Simple Moving Average.
The silence of Goldman Sachs on the move up is noteworthy. It would not be surprising to see it using all its tricks to drive the share price back down. Doubtless ABG will appear on its "conviction sell" list.|
|robrah: Pollen .I am still around .The company has done well to achive the cost saving that they have .and the share price is reflective. It is surprising how quickly they cut the cost of prodiction down . Hmm . Wonder why it took them so long to do it .Well see if they can do it consistantly.My bearish view was mainly due the abg missing target frequently and incurring higher cost of production compared to peers .Abg have done well .and with the price of gold higher .should help push the share price . HigherHow ever would i invest here for the long term . Na randgold has far more growth and great management and long term potential due to their competative advantage.|
|drewz: ABG is a better bet than Randgold because current ABG price is more distressed than Randgold: more risk = more reward, potentially.
ABG has had problems.
ABG is in process of restructuring.
Eventually, if sucessful, the discount in the ABG price will be unwound.
In other words, ABG is more highly geared to any recovery in the gold price.
Also Randgold is more fully covered by city fund managers so less opportunity for price discovery.
So I consider there to be more upside in ABG than in Randgold.
Hope this helps.|
|undervalued companies: Really well put it this way on abg RNS if they do what the telegraph hints cut the dividend reduce it and declare write downs there will be a slump in share price
Fighting against abg share price frankly is silly at present but I guess post RNS views might be different.
It's funny I pointed all this out on Sunday at least the telegraph is on ball with this seasons writedowns|
|jungmana: Imo ABG is a buy at this price. the all in cost is about $1100(cash cost of $893 from q1 results) and cash in hand of about £260m.
as gold rebounds above $1300, ABG share price will move up and I believe the company will be ok in the medium term as long as gold stays above $1200.|
|bobsidian: Noteworthy that the final dividend currently equates to a return of around 3.5%.
Would not be surprised to see the share price continue its descent up to the ex-dividend date of 1/5/13.
The big problem for ABG may be the financial impact in 2013 of a decline in turnover combined with an increase in capital investment which could see ABG move from a position of net cash to net debt whilst potentially reporting a headline net loss for 2013.
The current share price of ABG is doubtless moving to price in the perception of such a financial reality whilst suspending judgement on the ability of current management to succeed in its cost control measures and questioning the ability of ABG to maintain any dividend.
Brutal and unrelenting as the current strength of the Balance Sheet offers no support to the share price because of the perceived weakness to come. Doubtless market participants will be scrutinising the estimated financial impact of management initiatives throughout 2013 to provide an indication of the effect on the results for 2014.
Regardless, still a stunning collapse in the share price since the beginning of 2013. And not alone when you see similar percentage collapses in the share prices of POG and KAZ. It seems that any company moving toward the accumulation of debt in this environment is finding their share price being aggressively punished. And given that that is the modus operandi of the mining sector as a whole, little wonder the savaging the sector participants will take until there is a perception of net cash ouflows turning to net cash inflows.
Quite amazing to see equity markets so elevated without the positive participation this time round of the mining sector.|
|the sherman: (Big time investors please ignore me.)
Having only bought back in to this last week, I just had to sell again this morning on the open at 366, bit annoying throwing away a couple of hundred quid over the space of the weekend, but will have to make that up again elsewhere.
Chart wise looks like this is gapping back down to early 300's which is simply no good to me. It was aspirations of USA QE3 that recovered ABG from low 300's up to over 400 recently. Relying on Gold price to recover ABG share price is not good enough for me on its own, ie. it will only be a USA QE3 announcement that is going to help here, and that is not even a dead cert.
Would have liked something in the detail this morning to indicate substantial growth in the pipeline for ABG such as plans to bid for other Gold producers or something like that. No doubt ABG is a "good" company with healthy balance sheet and (fairly) steady profits but that alone is not going to help future share price. There needs to be something to attract buyers here.|
|the sherman: Here's my personal take for what its worth. I'm only a small time trader but at least this might get some discussion going.
I have sold out my ABG position for now as I am not brave enough. Since I believed (still do) that gold was the way to go, I bought ABG last year at around 465 which was a low trough at the time, expecting a bounce back up. Untortunately the opposite happened, reduced forecasts sent the share crashing leaving me badly under for some time. Through patience and hard work, I managed to trade more funds in and out a few times to bring my average way down and finally get out this week with only a small loss. Note that the fall to low 300s was little to do with Gold prices, but reduced ABG forecasts. I fail to see why the upcoming update (22nd July ?) will bring about any improvement, especially with Gold even lower.
The quick rise from low 300s back up to 400 was little to do with ABG future but came as a reaction to poor USA data which raised the possibilty of more quantitative easing. That may or may not happen however I think other slightly longer term issues will support Gold regardless of QE3 in USA and so I still invest mostly in Gold miners. I would like to get back into ABG at some stage as it is a stable, safe, well backed company with one of the best balance sheets in the industry but as I said, I am not brave enough right now. Significant ABG share price improvement in the short term will take either; much reduced costs, major growth in the way of aquisitions or serious sustained rise in gold prices. Discuss.|
African Barrick Gold share price data is direct from the London Stock Exchange