Archipelago Resources Share Discussion Threads

[silverfern] 25/7/2011 10:35

well they are on for about 6.5 to 7.5p eps this year, effectively confirmed today, rising to much higher for 2012 as production ramps. Colin L stated (in Feb) he expected the share to pitch around £1.00 this year.

[lfc4ever] 25/7/2011 10:25

with cash costs below 500, and gold above 1600....

do the math, as they say. this certainly has scope for another tidy break to the upside.

[ajviews] 25/7/2011 09:23

Some of the strength last week may also have been on the back of an Ambrian buy -

[yorgi] 25/7/2011 09:20

Yes that could well be the case Snickerdog it was a good buying price.

As well as keeping the market well informed Colin has done what he set out to do......and I agree I we expect some good drilling results soon and add to that an ever increasing POG without there appearing to be reason for it not to continue then we should see the share price continue it's climb. Every extra $ on the POG is to the bottom line for us.

[snickerdog] 25/7/2011 08:30

Yorgi, I would say that the rise was more to do with sentiment returning to the market and a quite obvious buying point. Someone's trading this stock in large vols taking a few pence at a time. Personally, I couldn't be bothered.

Colin seem quite good at keeping the market informed. Drill results or similar soon as well.

[yorgi] 25/7/2011 07:26

Yes just read it....we suspected there was something at the bottom of the rise at the end of last week. Only goes to show yet again nothing is watertight ! With the POG still strong and only going to get stronger we should move on further today.

[silverfern] 25/7/2011 07:22

reassuring RNS is out

[snickerdog] 22/7/2011 20:38

Ah Mr. B, it was a pleasure chatting to you last night. I did try to do a search under your name as I thought the same (could not spell it though!); I did not, however, realise that it was upon this board as I rarely post here and have often forgotten that I own any AR.

I do concur that AR is very well deserving of a place. Obviously we are quite well valued here already but when production gears up and if and when Colin L finds the extra gold he's looking for at the moment I can only think that we will be very happy.

I was thinking of a buy yesterday but held off, nevermind, it was great to see the demand for the stock today though.

[boadicea] 22/7/2011 20:28

Hi Snickerdog - (I knew we had met, bb-wise, before yesterday. You may recall the 'pumpkin' comment!)

I agree with Merrill's general points above and had considered 3 of the above-mentioned but rejected at the time in favour of others - including here - for some of the specific reasons Merrill mention.

In fact I see plenty of upside in all my prec-met holdings, except perhaps PGD which looks quite fully valued. Undoubtedly one or two of my holdings will disappoint and some, I hope, will multibag.

There is plenty in AR. to give it legs as exploration continues and as long as there is no fundamental hitch in output and development.
Well deserving of a place in a spread of plays imho - such as I consider prudent in the volatile arena of mining. I also have a preference for companies at this early stage of production where output is open to expansion and mine-life to extension and where gearing to pog is modest.

[snickerdog] 22/7/2011 19:39

There was a lot of interest today by someone taking some big chunks at 59 I think. I remember seeing 88, 98, 88k on the bid. Hope to see these held onto well into the end of the year or beyond.

[melody9999] 22/7/2011 19:24

well all of a sudden we are getting some volume traded - 1.5M today - so someone has started taking an interest.

[yorgi] 22/7/2011 19:19

It's been a good week for us I wonder what next week will bring us.

[yorgi] 22/7/2011 16:34

Yes Snickerdog but no mention of AR. in there that I can see !

[snickerdog] 22/7/2011 16:31

With gold continuing to hit new highs on worries about Eurozone and US debt, Merrill Lynch analysts are not a little bemused to note a recent, sustained underperformance by gold plays, especially in Europe, versus bullion.

In their view the discrepancy demands investors consider a number of gold stocks that fall into this underperforming category, including Petropavlovsk, African Barrick Gold and Centamin Egypt.

In a research note looking in detail at the mismatch between the performance of gold stocks and bullion, which a few days ago surged to all time high of US$1600/oz, the analysts insist that, in their view, the strong gold prices are not an indication of a 'bullion bubble', especially when considered relative to other commodities and financial assets.

For Merrill, the gold equity de-rating is partly due to the fact that, following large price gains in recent years, investors remain concerned about the long-term direction of gold prices.

Their own view, however, is that bullion prices between $1500-2000/oz are sustainable in the medium term. Furthermore, Merrill's base case equity valuations use a conservative $1110/oz long term price. Assuming $1500/oz longer term therefore "would represents even further upside potential on what are already depressed valuations".

On the basis of its analysis, the broker reckons there is, therefore, compelling scope for "catch up" trade with a regards to a number of gold plays. Its favourite 'buys' are Centamin, Petropavlovsk, African Barrick, Randgold, and European Goldfields(LON:EGU).

While the analysts believe investor wariness about the outlook for gold prices is a major explanation for underperformance of gold equities, they concede stock specific issues are also to blame to a certain extent. They add, however, that in relation to their top picks, many of these issues are now well understood and on their way to being resolved.

Randgold, for instance, has suffered a de-rating due to recent political unrest in the Ivory Coast unrest, delays at its Loulo gold mine in Mali, and difficult metallurgy at its Massawa gold project which straddles Mali and Senegal. "We think these issues & concerns are now well understood and priced in," says Merrill.

Centamin has been traded down as an Egypt proxy on political unrest but Merrill sees the resulting, ongoing fears about the outlook for its operation there "as overdone" and Centamin's ability to operate in the country as "secure".

Petropavlovsk has been suffering from an overhanging disappointment over missed guidances in 2010 and concerns about the outlook for its capital and operating costs. Merrill analysts, however, argue that recent updates from the company demonstrate credible plans for its future and that the de-rating of its shares "seems overdone".

African Barrick Gold, another Merrill top pick, was "plagued" by operational disappointments in 2010 and they have continued to weigh on sentiment. But the broker believes most of its problems have now been overcome, and the company is demonstrating improved performance.

Across its top picks above, Merrill notes that Petropavlovsk, African Barrick Gold and Centamin, in particular, are trading near or below their net present value.

The surge in bullion prices reflects investor interest in the physical form as a safe haven in uncertain times. But, as the analysts point out, one key reason to own gold equity over bullion is that gold companies aim to grow their reserve and production base over time, as well as pay dividends.

The analysts favour gold companies that offer more growth potential and believe Centamin Egypt and Randgold screen particularly well in this regard.

Merrill Lynch has a target price of 730 pence of African Barrick Gold; 270 pence for Centamin Egypt; 1,200 pence for European Goldfields; 1,250 pence for Petropavlovsk; and 6,800 pence for Randgold Resources.

[yorgi] 22/7/2011 12:58

:-)......Well I didn't say there wasn't Silverfern :-)

[silverfern] 22/7/2011 12:55

yorgi you started it! :)

[yorgi] 22/7/2011 12:33

Like what Melody ?

[melody9999] 22/7/2011 12:02

something is going on here, that's for sure

[yorgi] 21/7/2011 16:25

I know AR. can have a tendency to move quite sharply but could it be a RNS in the morning ???

[yorgi] 21/7/2011 16:20

Looking a bit lively into the close :-)

[plutonian] 20/7/2011 14:03

I received a copy of Resource Stocks Magazine yesterday (Aug 2011 edition) - sent to shareholders with a covering letter from Colin. There is a company profile on Archipelago Resources titled "Exploration will drive gold producer".

Nothing new, but a good recap on where we are:

160k oz pa. Cash costs $US445 (based on $US85 per barrel oil!)
4 rigs onsite and exploration budget of $US30 over next 2 years to target 10+ year mine life
Low prospective PE of 4 due to not being an established producer (yet!).

[silverfern] 19/7/2011 10:41

Of course $160 was the dollar - I even looked the rate up on XE!

[silverfern] 18/7/2011 18:17

not disagreeing - they need to get to 160k per annum asap which would produce around $1000 per ounce profit at today's market rate, at today's oil price. $160k m profit = £160m per annum. That, when seen to be achievable, will do what to the share price? I suggest it could go to 150p+ . Also a resource update is needed to show this is a long-term investment for anyone coming in now. I am very heavily invested here but I hope relaistic. I expect 120-135k next year and 160k ounces only by 2013 and gold to stablise around $1800 (but whoTF knows!). But those figures should also deliver $160m or close - gold price more than sells the current position inmho

[1chunk] 18/7/2011 12:08

With all due respect guys but you have to take the fairly large market cap here into consideration. Also AR is producing but have only just started. So the market wants to see consistent production numbers and targets being achieved.

Regards