African Barrick Gold Share Discussion Threads

[brucie5] 24/1/2014 22:00

Interesting. Up or down. Let's see who's right.

[nwb] 24/1/2014 08:49

Questor piece:

THE theory with shares in gold miners is that they offer a way to get higher returns from movements in the underlying price of gold. However, shares in African Barrick Gold seem to have only one direction of travel and that has largely been down during the past three years, despite big fluctuations in the price of the yellow metal.

The Tanzania-focused gold miner operates three mines in the country. On the face of it the miner's fourth-quarter results announced yesterday were good. Gold production increased to about 642,000 ounces for the year ended December 31. The company also cut the costs of production by 30pc on the same stage last year, to $1,171 per ounce. The problem for African Barrick is that, with the gold price hovering around $1,200 per ounce, it is dangerously close to break-even. That is not in itself a problem, but once you add in mine maintenance and the expansion of new projects then the company is spending more cash than it is making from its existing projects.

The cash levels at the company are steadily falling. Net cash at the year end was about $140m, down from $179m three months earlier and $401m at the start of the year.

It is difficult to get too enthusiastic about a company's shares when the core business is not generating cash. The only glimmer of hope would be that African Barrick potentially offers big returns if the gold price recovers. Questor is not confident returns will materialise.

The correlation between the gold price and African Barrick shares is weak at best. The price of gold soared from about $1,100 per ounce to $1,900 per ounce during the period between early 2010 and September 2011, gains of about 73pc. The shares of African Barrick Gold made no gains at all during the same period.

Analysts from Investec have put a target price of 137p on African Barrick shares in. Questor would steer well clear of this high-cost gold miner, which is seeing cash balances steadily fall. Sell.

[idle dreamer] 23/1/2014 18:48

Suspect there's more to it. Perhaps the Chinese are coming back. Volume was high today according to the chart above.

[brucie5] 23/1/2014 11:58

A sell? Well, I may be wrong and often am, but nowadays and for a long time, tend to believe the chart over any analysis. With the important rider that you always give yourself the room to get out quickly should you turn out to be wrong!

[brucie5] 23/1/2014 11:58

A sell? Well, I may be wrong and often am, but nowadays and for a long time, tend to believe the chart over any analysis. With the important rider that you always give yourself the room to get out quickly should you turn out to be wrong!

[nwb] 23/1/2014 11:48

Very quiet thread given the recent announcements and strengthening of share price. Also saw them as a sell recommendation in Questor yesterday.

[brucie5] 23/1/2014 11:47

Interesting to see how this one develops, cos i guess this is what a truly recovering pm chart looks like - with higher highs and lows. It's just pulled off the £2 level, and will perhaps now look briefly to confirm support. But this looks good to go. I say this without (currently) holding any, or knowing much about the underlying. But awaiting similar to happen to POG, MML, AMA, & HOC.

[sea and sky] 15/1/2014 11:00

hectorp: I am no expert but the drilling update seems encouraging... I did build a position in them and it has returned around 15% so far but I do feel they could break beyond this at the moment. Gold obviously out of favour at the mo but that may well not last. All IMHO but Gold usually gets a hammering until something unpleasant spooks the markets.

[hectorp] 15/1/2014 09:54

Bucking the slide in gold today.. so is CEY.

[lovegod2] 13/1/2014 18:26

check out osisko mining

[hectorp] 09/1/2014 10:04

Looks ready for the big push above 200p. But will it happen hext week, or in 2-3 months.
Support 162p.

[hectorp] 03/1/2014 13:24

Sea and Sky - that's very difficult to answer, as I do admit their business plan, is rather complex.

[leecoyote] 28/12/2013 10:41

Very interesting observation on the gold miners here -

If they're right it seems a no brainer for 2014?

[sea and sky] 20/12/2013 14:40

hectorp. how safe is the Div on ABG would you say? I am thinking of building a small position.

cheers

[hectorp] 20/12/2013 10:04

The downtrend from above 200p in November, seems to have petered out - even though the US is tapering.
But I am not adding more now for a couple of months or I see a bottom for gold.
HOC is very interesting too at the moment , for silver.

PLAT may do well in 2013, probably best simply to have a long Platinum spread as I dont trust the SA miners not to strike etc.

[hectorp] 18/12/2013 12:26

Looking better yet again. Doubled up.

[hectorp] 14/12/2013 13:11

Buffett, and others,

Randgold - ok, but surely over exposed to SA Unions, factionalism, political disruption, strikes etc. I feel SA is heading for a less, not more, stable few years ahead.
I'd prefer if in African gold mining to be in other areas , as ABG happens to be. I bought some ABG in March, though a small volume, and then closed for a loss, not always wise.
EDITED
Bought a few for starters this morning.

[robrah] 04/12/2013 15:40

Some ppl see 200p some see 100 .Take a pick turner

[rcturner2] 04/12/2013 15:27

I am amazed at how quiet this thread is! 25% fall in November and the total posts on here is 9!

[frogone] 26/11/2013 11:39

The world is now even more unstable with the flimsy Iran deal on enrichment in place. I'm looking at 200+ very soon.

[robrah] 25/11/2013 08:14

1232....tick tock tick tok

[robrah] 22/11/2013 07:48

Better bring out some seriously good news soon .price of gold 1245 could b back below 100 very fast

[lovegod2] 18/11/2013 18:07

gold is crashing but this share is holding its own...the turn in the gold price should be in the next 60 days ..watch this rocket when it happens

[enami] 15/11/2013 10:03

RNS

African Barrick Gold Agreement to transfer Tulawaka

A quiet nationalisation?

EDIT - I suppose not, the mine was already slated for closure and rehabilitation.