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PAF Pan African Resources Plc

24.40
-0.20 (-0.81%)
15 Apr 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Pan African Resources Plc LSE:PAF London Ordinary Share GB0004300496 ORD 1P
  Price Change % Change Share Price Shares Traded Last Trade
  -0.20 -0.81% 24.40 5,642,706 16:35:21
Bid Price Offer Price High Price Low Price Open Price
24.20 24.30 25.00 24.10 25.00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Gold Ores USD 321.61M USD 60.74M USD 0.0317 7.68 466.67M
Last Trade Time Trade Type Trade Size Trade Price Currency
18:28:29 O 17,808 24.516 GBX

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Date Time Title Posts
15/4/202409:38Pan African Resources a sleeping giant1,731
12/4/202412:38Pan African Resources - Ripe for Takeover ?106
01/3/202411:28tuscan-
20/11/202316:21Pan African Minerals - Road to Takeover3
20/10/202310:09Pan African Resources for 2006 (PAF) Moderated13,138

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Pan African Resources (PAF) Most Recent Trades

Trade Time Trade Price Trade Size Trade Value Trade Type
17:28:3024.5217,8084,365.81O
16:54:4824.4024,0895,877.72O
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16:54:3624.408,5682,090.59O
16:35:4224.37493,351120,229.64O

Pan African Resources (PAF) Top Chat Posts

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Posted at 15/4/2024 09:20 by Pan African Resources Daily Update
Pan African Resources Plc is listed in the Gold Ores sector of the London Stock Exchange with ticker PAF. The last closing price for Pan African Resources was 24.60p.
Pan African Resources currently has 1,916,503,988 shares in issue. The market capitalisation of Pan African Resources is £466,668,721.
Pan African Resources has a price to earnings ratio (PE ratio) of 7.68.
This morning PAF shares opened at 25p
Posted at 15/4/2024 09:38 by stonedyou
Gold rate today: Israel-Iran war continues to fuel gold prices despite US dollar rate touching 34-year high against Yen.

15 Apr 2024, 10:51 AM IST

Asit Manohar


Gold rate today, 15th April 2024: Despite the rally in the US dollar index, gold prices continue to trade with positive bias during early morning deals on Monday. On the Multi Commodity Exchange or MCX, gold rates today opened higher at ₹72,214 per 10 gm and went on to touch an intraday high of ₹72,362 per 10 gm within a few minutes of the commodity market's opening bell. In the international market, spot gold price is trading around $2,360 per troy ounce, which is around 0.70 percent higher from its Friday close.

Iran-Israel war in focus
Speaking on the reason for the rise in the gold prices, Royce Vargheese Joseph, Bullion & Energy Research at Kotak Securities said, "Gold prices are largely driven by escalating tensions between Iran and Israel amidst the ongoing Middle East crisis. This geopolitical uncertainty has fueled a rush into safe-haven assets, propelling gold prices up by 1.60 percent. Despite this sharp increase, the overall trend in gold remains bullish, with strong support seen at ₹70,000 per 10 gm mark."


“Gold and silver prices are rising despite the continuous rally in the US dollar index. The US dollar index touched 106 level and the US dollar rate has hit a 34-year high against the Japanese Yen, but the escalating tension in the Middle East has pushed demand for the safe haven," said Anuj Gupta, Head of Commodity & Currency at HDFC Securities.

After Israel's counterattack on Iran, the geopolitical tension in the Middle East has further escalated. Iran fired more than 300 drones and missiles at Israel, which Tehran said was in response to the April 1 strike on its consulate in Syria. Almost all Iranian drones and missiles were shot down by Israeli, US, and allied forces before they reached their targets.

To stop further escalation of the Middle East crisis, US Secretary of State Antony Blinken on Sunday reached out over the phone to the foreign ministers of Jordan, Saudi Arabia, Turkey, and Egypt, while Defense Secretary Lloyd Austin had calls with his Saudi and Israeli counterparts, amid signs of an escalating crisis in the Middle East following Iran's strikes on Israel.

Gold rate today: Important levels
On important levels regarding gold price today, Shiju Koothupalakkal, Technical Research Analyst at Prabhudas Lilladher said, "The precious metal has been skyrocketing in the last one and a half month from ₹62,200 zone to touch ₹72,800 per 10 gm levels, gaining almost 17% in a very short period. Currently, with the geo-political tensions looming around, the yellow metal is anticipated to gain further in the coming days with near-term targets of ₹73,700 and ₹75,200 levels. The near-term support would be maintained near the ₹70,200 zone as of now."
Posted at 04/4/2024 10:35 by stonedyou
Einhorn Bets Big on Gold Amid Inflation, Eyes Value Stocks.

Einhorn bets big on gold amid inflation concerns, predicts fewer than three Fed rate cuts this year.


Key Takeaway

David Einhorn warns inflation may be reaccelerating, doubting the Federal Reserve will cut rates more than twice this year, if at all.
Einhorn's Greenlight Capital significantly increases its gold holdings, including $74 million in SPDR Gold Trust and physical bars, as a hedge against fiscal policies.
Despite market concerns, Einhorn sees value in stocks like Solvay after its spinoff into Syensqo, highlighting opportunities in undervalued companies.

Inflation Concerns Persist

David Einhorn, the hedge fund manager of Greenlight Capital, expressed concerns over persistent U.S. inflation, suggesting that bringing inflation down might be more challenging than investors anticipate. Despite expectations, Einhorn predicts "fewer than three" interest rate cuts from the Federal Reserve this year, with a possibility of none occurring. This perspective comes in light of recent U.S. data indicating a core personal consumption expenditures price index rise of 2.8% in February, surpassing the Fed's 2% inflation target. Einhorn's stance on inflation reaccelerating is supported by various indicators, highlighting the complexities facing the U.S. monetary policy.

Gold as a Defensive Play

Amidst inflation concerns and potential market downturns, Einhorn is increasing his investments in gold, viewing it as a hedge against loose monetary and fiscal policies. Greenlight Capital's significant position in gold, including physical bars and $74 million in the SPDR Gold Trust fund, underscores Einhorn's strategy to mitigate risks associated with fiscal deficits and policy challenges. This move reflects a broader trend among investors seeking safe-haven assets in uncertain economic times.

Value Investing Opportunities

Despite the overarching concerns, Einhorn identifies emerging opportunities in value stocks, particularly in companies undergoing spinoffs. He cites Solvay, a Belgium-based chemicals and plastics company, as a prime example, having picked up shares following its spinoff into Syensqo. Einhorn's investment in Solvay, despite its significant share price decline, illustrates his belief in the market's mispricing of value stocks. This approach is part of Einhorn's broader critique of the current market dynamics, where he sees a lack of investment in identifying undervalued companies.

Einhorn's Strategic Insight

Einhorn's investment philosophy focuses on identifying undervalued companies with strong growth potential, a strategy that has historically yielded significant returns for Greenlight Capital. His interest in Solvay aligns with this philosophy, emphasizing the company's market leadership and stable, high-margin businesses. Despite Greenlight Capital's slight underperformance compared to the S&P 500 last year, Einhorn's strategic moves, including his investment in Solvay and his defensive play in gold, highlight his adeptness at navigating market complexities and identifying potential growth opportunities.

Street Views
David Einhorn, Greenlight Capital (Neutral on the market and inflation):
"I think inflation is reaccelerating. I think there’s a lot of indication of that... fewer than three interest rate cuts from the Federal Reserve will take place this year — and that there’s a chance that no cuts actually take place."

[1]
Key Fed inflation gauge rose 2.8% annually in February, as expected
[2]

Greenlight’s David Einhorn unveils chemicals company Solvay as top investment idea
[4]

David Einhorn thinks inflation is reaccelerating and has made gold a very large position
Supernews

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Posted at 02/4/2024 10:42 by stonedyou
Western Investors Bank Record Profits on Gold

Tuesday, 4/02/2024 09:30

"With the People's Bank of China seemingly happy to buy gold at any price."


WESTERN INVESTORS just banked record profits from gold, selling more than twice the quantity that they bought as a group in March using world-leading marketplace BullionVault, as speculative betting by hedge funds, plus China's relentless central-bank demand, drove the price of gold up to new record highs in all major currencies.

But record-heavy selling by a record number of customers still left client holdings at BullionVault worth fresh record high above $3.2 billion (£2.5bn, €3.0bn).

"Previous peaks in the number of people selling gold also came as bullion prices jumped," says BullionVault director of research Adrian Ash. "But they all coincided with moments of acute political or financial stress, spurring stronger investor demand.

"In contrast, gold's new all-time highs have come without any external trigger. That speaks to the underlying strength of this uptrend, with relentless demand for physical bullion from emerging-market nations led by China more than offsetting the record-heavy profit taking by Western investors."

The price of gold jumped by 8.1% last month – its fastest gain in a year – to finish at a new record of $2214 per Troy ounce (+8.5% to £1752, +8.7% to €2050) after setting a fresh all-time high on 9 of the global wholesale market's 20 trading days across March.

In response, the number of private investors buying gold on BullionVault – almost 9-in-10 of whose users live in Western Europe or North America – slipped 3.4% to the fewest since December.

The number of sellers in contrast rose 95.1% to beat the number of sellers in March 2023 (the 'mini crisis' in US regional banking), August 2011 (US debt downgrade, Euro debt crisis, English riots), March 2022 (Russia's all-out invasion of Ukraine) and June 2016 (the UK's Brexit referendum shock).

Together, that took the Gold Investor Index – a unique measure of trading decisions among the world's largest single pool of private investors in physical bullion – down to a new series low of 47.5, down 4.0 points from February with its steepest drop since July 2016.

Tracking gold investor actions since October 2009, the index would read 50.0 if the number of buyers exactly equalled the number of sellers across the month. It reached 65.9 as the Covid Crisis took hold in March 2020, and it set a series high of 71.7 when gold prices hit their global-financial-crisis peak in September 2011.

The Gold Investor Index has recorded more gold sellers than buyers only twice before (48.8 in Feb 2010, 49.1 in June 2019).

By weight, total demand to buy gold on BullionVault – now open 24/7 since April 2005 – rose 4.5% in March from the previous 12-month average to reach 0.7 tonnes. But selling more than doubled, rising 100.3% to total more than 1.6 tonnes.

Net-net, that saw private investors liquidate 992 kilograms of gold – 28.0% more than the previous record outflow of June 2019 – worth a record $68.8 million (£54.1m, €63.3m).

That took investor gold holdings at BullionVault down to 45.5 tonnes, the smallest since 2020 and down by 5.5% from the record high holdings of last August. By value, however, those investor holdings have risen 7.7% in Dollar terms over the past 7 months to finish March at a record $3.2 billion (+8.1% in GBP to £2.5bn, +8.3% in Euros to €3.0bn).

"With central banks led by China paying record-high prices for gold, Western investors are increasingly happy to sell, taking profit at the highest prices in history. But this is rebalancing, not a rush for the exits, because their remaining holdings have also risen in value to new record highs, and gold's appeal as a form of investment insurance is undimmed, ready for whatever political or financial crises 2024's highly uncertain outlook could bring."

Like gold, silver jumped in price last month, rising 9.8% to its highest monthly close in four at $24.54 per Troy ounce (+10.2% to £19.46, +10.3% to 22.76).

That saw the number of silver sellers on BullionVault double in March from the month before, up 108.7% to the most since February 2021, when the #silversqueeze ramp on social media sent silver prices towards an 8-year high 1 cent shy of $30.

Back then, the number of silver buyers across the month was 4.7 times larger than March 2024, putting the Silver Investor Index at 61.0, its 8th highest reading since the series began at New Year 2012. But last month the index sank to a new all-time low, down 5.1 points to 45.0 and signalling more sellers than buyers for the 4th time in the past 12 months.

By weight, silver selling outran buying by a record 29.8 tonnes, taking the total stock of silver bullion still held down 2.4% to 1,199.8 tonnes, the lowest since April 2021 and 5.3% smaller from the record high of October 2022.

By value, in contrast, BullionVault users' silver holdings have grown by 11.8% to $878 million (+11.0% in GBP to £750m, +11.8% in Euros to €878m).

"Gold's sudden jump to new all-time highs leaves the price looking stretched short term," says Ash, "and the market may struggle to absorb the huge quantity of bullion coming back from Western investors, especially as Asia's big consumer nations head towards the seasonal summer lull in household demand.

"While Asia's big gold buying markets can be very price-sensitive short term, consumers have repeatedly grown accustomed to higher gold prices over time. Short of peace and trust breaking out between the West and 'the rest', demand from emerging-market central banks looks set to continue, with the People's Bank of China seemingly happy to buy gold at any price."
Posted at 25/3/2024 16:08 by stonedyou
Is it a golden era for gold?



Executive summary

The price of gold is often driven by a complex interplay of factors, including the U.S. dollar exchange rate, real yields, supply/demand dynamics and sentiment. In recent years gold has exhibited a tendency to react to real yields in an asymmetric manner, supported by strong central bank purchases.

We are constructive on gold given peaking real yields, elevated geopolitical uncertainties, robust central bank demand, and strong retail jewelry demand.
For long term investors, gold merits a position in a diversified portfolio, potentially serving as short-term protection against risk events, a reliable longer-term store of value, and most importantly as a portfolio risk diversifier.

Gold has been a sought-after commodity for centuries, and a popular component in investment portfolios in modern times. The metal has historically delivered attractive long-term returns, appreciating ~8% on an annual basis over the past 20 years. That said, its price has exhibited significant volatility – with prices tumbling around 40% from 2011 to 2015, before it fully recovered in 2020. At the time of writing, the metal is making new all-time highs, breaking $2,180/oz on Mar 11, 2024.

The price of gold is influenced by a complex interplay of macro factors as well as supply/demand dynamics. Understanding its unique characteristics and benefits is crucial for investors who look to establish portfolios that endure through cycles. This article aims to identify and analyze the key drivers of gold prices, how they evolved in recent years, and how an appropriately sized gold investment can add value to a portfolio from an asset allocation perspective.


What drives gold prices?

1. The level of the U.S. dollar

Historically, it would be fair to say that the value of the U.S. dollar is often negatively correlated with gold prices, as the metal is priced in dollars. When the USD weakens, gold becomes relatively cheaper for holders of other currencies, leading to increased demand. And the opposite is often true, with gold weakening as the dollar strengthens. However, there can be extended periods when this relationship breaks down. In 2012-13, for example, gold lost -18% of its value when the USD was fairly stable – rising less than 1%.

Looking ahead, we think the dollar environment should be relatively supportive for gold prices. After a significant rally in 2022 and a flattish 2023, the dollar is currently trading 10-15% higher than its fair value, implied by interest rate differentials and its own long-term average. Over the medium term, we think the dollar will likely revert to mean, and its overvaluation should be ultimately unwound. This process could take some time, as the dollar could be supported over the near term by cyclical growth outperformance in the U.S. relative to other major economies. That said, further strength from current levels should be limited. We expect U.S. economic growth and interest rates to gradually “catch down” to the rest of the world as the labor market wage increases cool down and the Federal reserve begins cutting rates, likely starting in the 2H.

U.S. DOLLAR STILL SCREENS ~10% OVERVALUED AGAINST INTEREST RATE DIFFERENTIALS
Posted at 12/3/2024 12:08 by stonedyou
Gold: This Breakout Is Unambiguous.

Review

After a sharp two-month rise to a new all-time high of USD 2,149 on December 4th, the gold market experienced a sharp pullback to USD 1,973 in the final weeks of the old trading year, followed by a rapid recovery to USD 2,088. To digest this overall quite tumultuous market activity, gold prices entered a slow and confusing sideways phase since the beginning of the year. This was necessary to calm down the overbought situation after this rollercoaster ride. Gold – This breakout is unambiguous.

During this consolidation, all attempts to break out on the upside repeatedly failed at the resistance zone around USD 2,055. At the same time, the psychological level of USD 2,000 resisted the bear attacks. Only in mid-February did they seem to successfully break through to the downside. However, the drop below USD 2,000 quickly turned out to be a bear trap because, starting from the low of USD 1,985, gold prices reclaimed the psychological round number support with a closing price of USD 2,004 on the next trading day.


Bear Trap Below USD 2,000

Subsequently, gold prices rose steeply and continuously for a total of 18 trading days from that February 14th. Since breaking through the downtrend line at USD 2,055 on Friday of the previous week, this rally has accelerated. Gold prices not only effortlessly surpassed the old all-time high at USD 2,075 but also reached the highest level ever, peaking at USD 2,195 during last Friday.

Undoubtedly, this marks the definitive end of the 13-year correction and consolidation phase that repeatedly hindered bullish efforts in the range between USD 1,900 and USD 2,075. Consequently, the steep breakout rally pushed gold up by over USD 210 in a very short period of time. Regardless of short-term pullbacks or interim consolidations, this likely signifies only the beginning of the next major uptrend in the precious metals sector!

Source: Tradingview

After the initial attempt failed back in December, gold finally and decisively surpassed the major resistance of the last three and a half years around USD 2,075 on Friday, 1st of March. This bullish price action confirms the significant inverse head and shoulders formation and brings an end to the long wait. The target from this formation is approximately USD 2,535 and could potentially be reached in one volatile surge!

However, on the weekly chart, gold prices are currently trading well outside the upper Bollinger Band (USD 2,153). Statistically, the air is somewhat thin with prices around USD 2,180 at least in the short term.

Yet, it is essential not to underestimate the fact that the energy accumulated over three and a half years is now being unleashed in the gold market. The momentum is clearly on the side of the bulls. It can also be assumed that after the two-and-a-half-month consolidation, the ongoing rally is unlikely to end after just three weeks. In case of doubt, the new uptrend may continue swiftly but with volatility.

Overall, the weekly chart is bullish. Gold should be on its way towards USD 2,535 in the medium term. Significantly higher prices are also conceivable afterward. Possible pullbacks to the old resistance zone in the range between USD 2,075 and USD 2,100 should still be anticipated and would be a buying opportunity.

Daily Chart: Stochastic Bullish Embedded
Posted at 27/11/2023 15:53 by stonedyou
Will gold prices increase in 2024? Here's what the experts think.


Gold investing has garnered a lot of attention in the last year or so. Gold prices soared, hitting their highest point in over a year, and discount retailer Costco even started selling gold bars online.

It's no wonder either: Gold has long been known as a smart hedge against inflation — and with inflation well above the Federal Reserve's 2% goal, many consumers have sought out its protection. Gold is also a portfolio diversifier and, generally speaking, a good store of value in the long run.

Despite all this, though, gold prices do fluctuate in the short term. In September, for example, the average price dipped below $1,850 per ounce. By the end of November, prices jumped over $2,000. Will prices top that in 2024? Here's what experts have to say.


So, where are gold prices headed next year? Here's where the experts think gold prices will land in 2024.

The economy will call for some safe bets

One of the big reasons gold has become popular lately — and pricier — is stubborn inflation. And while the Fed has hiked interest rates many times to help quell it, the central bank is still far from its 2% goal. And according to a forecast from WisdomTree Investments, it will stay that way for a while.

WisdomTree's forecast currently projects a 3.1% inflation rate at the start of 2024 and a 2.60% rate by the third quarter. This persistently high inflation could push up demand for gold and, subsequently, gold prices.

"When inflation rates rise, gold prices often increase as well," says Liam Hunt, a financial writer and analyst for Gold IRA Guide. "If current trends of economic uncertainty and inflationary pressures continue, there could be upward pressure on gold prices. In 1980, gold prices reached a then-record $800 per ounce following years of generationally-high inflation over the preceding decade."

Forecasts aren't always right, though. And while WisdomTree currently predicts gold prices to hit a new all-time high next year, if economic conditions worsen, demand for gold could rise considerably, sending prices up even more.

As Nitesh Shah, head of commodities and macroeconomic research at WisdomTree, explains, "In other scenarios of the world where economic conditions deteriorate faster and there is greater demand for defensive assets, we could see gold prices rising even further."

Explore how gold investing could benefit you here.

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Geopolitical tensions and the election could drive up demand for gold
Inflation is an important factor to watch next year if you're tracking gold prices. Geopolitics are another.

"Periodically, geopolitical risks, and a flight to safety drive up the demand for gold," Shah says. "Recently, the Israel-Hamas conflict has driven up the geopolitical premium in gold."

He's right: After the conflict between Israel and Gaza began in early October, gold prices soared, reaching points not seen since mid-2022.

"Fears that an uncontained, regional war could disrupt global markets and supply chains triggered capital flight into gold and away from speculative assets such as high-risk stocks," Hunt says. "Gold is often seen as a safe-haven asset. In times of economic uncertainty or market volatility, investors tend to turn to gold, putting upward price pressure on the yellow metal."

Another time investors might flock to a safe-haven investment like gold? That'd be during a presidential election, when some might view a change in leadership as a risk to their finances.

"Given the U.S. presidential election in 2024, we expect retail demand for gold to remain high as investors turn to the metal to hedge against what they feel is a risk of an adverse outcome," Shah says.

Gold prices will increase
Given economic conditions and political tensions, most experts agree that gold prices are going to rise in 2024, as more and more consumers seek out a safe spot to store their wealth.

"Gold is the best hedge there is and every portfolio," says Collin Plume, founder of Noble Gold Investments. "We have an average of an economic downturn every 5.5 years. Each time a downturn happens, you need that one asset that will keep you buoyant while you wait for the rest of your portfolio to recover."

According to WisdomTree's forecast, gold prices will climb throughout 2024, eventually reaching $2,090 per ounce by the third quarter. In its "bull" forecast, the firm projects prices could get as high as $2,300 per ounce.
Posted at 22/11/2023 10:29 by stonedyou
Pan African Resources positioned for 'excellent results’ thanks to improving gold volumes.

Published: 08:11 22 Nov 2023


Pan African Resources PLC (AIM:PAF, OTCQX:PAFRY, JSE:PAN, OTCQX:PAFRF) (PAF) is positioned to deliver "excellent results" for the full financial year, chief executive Cobus Loots told investors.

The gold miner, in an interim production report released today, said half-year gold output was between 94,000 and 98,000 ounces – representing a 2% to 6% improvement on the same period a year ago.

Operationally, PAF said it is performing in line or better than anticipated across it portfolio.

The Barberton mine yielded 37,000 to 38,000 ounces, with a switch to continuous mining operations providing higher tonnage and grades, whilst the Evander mines contributed 20,000 to 21,000 ounces which was also an improvement helped by grade and improved "conveyor availability".

At the Elikhulu tailings, the company produced 27,000 to 28,000 ounces. Meanwhile, Evander surface operations yielded 2,000 ounces and tailings retreatment at Barberton contributed a further 8,000 to 9,000 ounces.

For the full year, PAF is now expecting production in the range of 180,000 to 190,000 ounces, up slightly from prior guidance of 178,000 to 190,000.

“The expected production performance for the half year to December 2023 positions the group to deliver excellent results for the full financial year,” said Loots.

“The continued momentum with the construction of the MTR plant at the group’s Mintails project is again testament to our track record of bringing world class tailings retreatment projects to account.

“MTR is expected to commence production at the end of 2024, and will add some 50,000 oz/yr to group production, increasing our annual output by some 25%.”
Posted at 13/11/2023 17:23 by justiceforthemany
If you're a shareholder here and want the share price to rise then email Investor Relations because the share price consistently closes at a lower price than the JSE in SA. There is blatant manipulation going on here keeping the share price suppressed.

Why is PAF trading at just 3-4x P/E?

Email
hhira@paf.co.za
Posted at 20/9/2023 12:37 by justiceforthemany
EDISON RESEARCH
Valuation: Cheap by any measure

Despite making a number of adjustments to our model to reflect updated circumstances, as well as guidance, our core (absolute) valuation of the company remains almost unchanged at 34.59c (cf 34.24c previously), based on projects either sanctioned or already in production. However, this valuation rises by a further 18.59–23.61c if other assets (eg Egoli) are also taken into account. Alternatively, if PAF’s historical average price to normalised HEPS ratio of 8.4x in the period FY10–23 is applied to our FY24 and FY25 forecasts, it implies a share price of 36.29p in FY24, followed by one of 38.22p in FY25. As such, PAF’s current share price of 14.28p could be interpreted as discounting normalised HEPS falling to 2.12c per share (cf 5.40c/share and 5.69c/share for FY24 and FY25 forecast, respectively). In the meantime, PAF remains cheaper than its principal London- and South African-listed gold mining peers on at least 94% of commonly used valuation measures if Edison’s forecasts are used and 86% of the same measures if consensus forecasts are used, which collectively imply a share price of 27.24p on the basis of our year one EPS and 35.17p based on our year two EPS. Finally, we estimate that PAF has the sixth highest dividend yield of any precious metals mining company, globally (cf the 10th highest previously). In the meantime, its enterprise value equates to just US$9.41 per resource ounce of gold.
Posted at 14/6/2023 16:23 by justiceforthemany
Valuation: Still closer to 30p than 20p

Notwithstanding our earnings forecast reduction, PAF remains cheap relative to both its historical trading record and its peers. Our core (absolute) valuation of the company has risen by 4.8% to 34.17c (cf 32.59c previously), based on projects either sanctioned or already in production, with all of the increase effectively attributable to the recent decline in the value of the rand against the US dollar. Moreover, this valuation rises by a further 17.06–22.08c (16.09–21.11c preciously) once other assets (eg Egoli) are also taken into account. Alternatively, if PAF’s historical average price to normalised HEPS ratio of 8.6x in the period FY10–22 is applied to our FY23 and FY24 forecasts, it implies a share price of 26.56p in FY23 (cf 29.53p previously), followed by one of 32.74p in FY24. As such, PAF’s current share price of 13.50p could be interpreted as discounting normalised HEPS falling to 1.94c per share in FY23. In the meantime, PAF remains cheaper than its principal London- and South African-listed gold mining peers on at least 83% of commonly used valuation measures, which collectively imply a share price of 35.06p in FY23 and one of 35.09p in FY24. Finally, we estimate that PAF still has the 13th highest dividend yield of any precious metals mining company, globally.
Pan African Resources share price data is direct from the London Stock Exchange

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