Avocet Mining Share Discussion Threads

[pecker1] 18/11/2005 16:59

Maybe Idenburg drilling results RNS early next week.

[stemis] 18/11/2005 16:57

Yes, that was some recovery.

[saucepan] 18/11/2005 16:39

AVM price behaviour is so hard to fathom! A surprisingly nice end to the week, all things considered.

[brad1] 18/11/2005 16:21

good man u r BB - u know it makes sense

[chchipss] 18/11/2005 09:01

With the shortened trading week next week due to the Thanksgiving Holiday, December gold and silver options will expire on Tuesday November 22. Investors have been buying the December calls throughout the year, and there is a MOUNTAIN of call options out there. Between the strike prices of $440 and $490 there are 49,750 call options. Each option represents 100 ounces of gold, therefore after rounding, there is well in excess of FIVE MILLION ounces of gold on option for the December contract. The $450 strike price alone has 10,510 calls against it. At $470, $475, and $480 there are approximately 6,000 calls at each strike price. In the next few trading days, every five dollars up or down is a very big deal. If the call writers can cram the price down into options expiry next week, they can save themselves many millions of dollars!

[bestbuddy] 18/11/2005 00:31

Graph looks very positive to me. The trend is up, share price now at the bottom of the channel and gold hitting long highs what more do you want? You should be happy to be given such a golden buying opportunity IMHO (Pun was intended).

[corrientes] 17/11/2005 19:55

From what I read, AIM is supposed to be increasingly popular in the international arena. Can't see why unless there's a lot of fundraising here, and I haven't seen much evidence of that from the small companies that do list on AIM. It all seems a bit of a contradiction to me, but then when did retail investors ever count for anything. With AVM, everything points to jam eternally tomorrow. Until they start paying a dividend,it'll never be valued as it should be. When a dividend looks likely, there'll be every reason under the sun, not to pay one,whether it's because of dehedging,funds needed to increase/replenish reserves et al.The only good part is any downside would be limited when metals go out of fashion, but hell,that's the reason you buy blue chips, not gold stocks. Gawd, I'm convincing myself to sell my holding !

[yikyak] 17/11/2005 15:09

corrientes, it's the system unfortunately. The London AIM market is getting a reputation of unscruplous greedy market makers and high costs to trade through taxes and touch's. By default because of the latter the lack of liquidity is only adding to the problem through investor migration, it's a downward spiral.

Avocet is one of only two listings I have long positions in left in the UK. I only continue to hold it because it continues to scream undervalued at me. I'll give it another few months and then put some cotton wool in my ears and throw in the towel.

When you think about it perhaps exchanges such as the TSX, ASX and AMEX are benefiting from increased European inflow of capital. Perhaps one day it will rotate as all money does back to the UK. I'm guessing this is a while off though.

[corrientes] 17/11/2005 13:24

Thank goodness for North American gold stocks. Must be Gordon Brown using his ill-gotten gains to short anything golden.

[kojak78] 17/11/2005 13:14

What about Emperor Gold? 910 mio shares at A$.395 + US$30 mio debt = US$294 mio

Reserves: 2.2 mio oz = US$133/oz (Avocet US$82/oz)
Production: 375,000 oz = US$784/oz (Avocet US$750/oz)

Emperor is a very good investment. Avocet is even better, even in its current shape of only 210000 oz production.

[yikyak] 17/11/2005 11:31

My thoughts exactly kojak, at least then we could be influenced by arbitrage, nothing else seems to work. HUI up aproximately 7% yesterday, fantastic, yet AVM pretty much down the same!!!

With the ease of trading internationaly have the most savy of private investors fled the London market to the North American and Australian markets instead. Bit like the gold rushes of old where they all jumped on boats and fled to where the action was.

[kojak78] 17/11/2005 10:31

It would be worth it, no doubt. Some people (like me) can buy only at bid/ask which means 3p loss per buy/sell. That is the reason I avoid trading in or out. Americans are restricted to US-listed stocks. Avocet as a Canadian or US stock would give you US$1000/oz if considered low quality or US$2000/oz if considered high quality gold producer. Reserve valuations vary between US$100 for undeveloped projects and US$300/400 for high production/low reserves companies (Croesus in Australia would fall into that category).
Avocet would cost 320 mio without consideration of Bakan, Buffalo Reef, Idenburg, South Sulawesi, Taror, Chore etc. All those projects combined could justify a market cap of several hundred millions more.

[mjcrockett] 17/11/2005 10:12

Kojak, So would it be a good thing for Avocet to get a listing on a North American exchange? I know this can cause a lot of extra expense and there is always the risk that the share is unpopular and thinly traded, but if there is such a valuation difference it could be worth it.

MJ

[kojak78] 17/11/2005 10:09

BTW, Avocet is now the 25th biggest gold producer on the planet based on trailing production.

[kojak78] 17/11/2005 09:58

114p seems fine. I hope those people will sell at those prices. Take alook at the North American stocks and you'll see that there is no gold stock with a p/e of 15 (or 10 or 7). Take a look at the resource plays like Miramar or Novagold . Hundreds of millions in market cap. Although I have to admit that I owned some Miramar stock in 2001/02, quick 150%. But I think they are just too expensive now. Penjom alone as a North American gold mine would cost 160 mio, Avocet's entire market cap. And Avocet's exploration/resource potential is far better than that of Miramar.

[wolstencroft] 17/11/2005 08:59

BTW 114p is Seymour Pierce's latest target, down from 130p.

[kojak78] 17/11/2005 08:25

I doubt we will see production rise much above 235 in 2007. Full scale production for the three mines is only 85+120+50=255 and they have still problems in Tajikistan.
It will be quite interesting to observe reserve growth as Taror and Chore come into production. That would bring reserves to ca. 3.5 mio oz. Add to that exploration success (Bakan could add 1m oz, existing mines have lots of potential for reserve additions and Idenburg could bring 1m attributable oz) and it looks as if 5m oz reserves is very probable in the next few years. Even with most exploration projects failing and no success in Tajikistan aside from Taror and Chore.
US$32/oz looks very healthy vs. the current average of US$150 or so. At least a new high is due as the XAU has broken out. I expect Avocet to do the same and rise above the November 2004 high of 114p (currency adjusted).

[brad1] 17/11/2005 08:12

At 4,000 ozs/month the hedge will be closed in about a year. Turnover up 31% with reduced profit of $3.4m (but still a decent [profit). Stockpiles will reduce overall future cash costs at certain operations. Good exploration results all over especially at Penjom with upgrade of resource @ Effendi due in the near future. Expect an RNS shortly regarding Idenberg. Diversified future pipeline - Dynasty prospect could be very interesting!

Now I know there have been increased cash costs etc etc BUT the management still produce positive results (I have seen much worse results than this from other mining companies and there share price rises!

I am more than happy to hold these shares with a view of topping up shortly. This is a quality company with an exciting future, and yesterdays drop will not put me off in the slightest. Good luck to all holders.

[goml] 17/11/2005 07:57

Holdontight, I agree, they've startedthe process it should be all out to complete it. Get rid of the hedge before it costs even more than an arm and a leg.

[holdontight] 16/11/2005 22:53

"and analysts are expecting production to grow to 235,000 attributable ounces of gold in 2007"

...this is key. Quite possible for this to be significantly exceed by 30%/40% or more!!

[holdontight] 16/11/2005 22:42

Hope they use funds to reduce hedge ahead of paying divi!!