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12/4/2021
15:20 | rivaldo: Yep, 5.7m shares traded so far today. This share is a real conundrum. Perhaps this is the turning point....:o))
Incidentally, CAPD's holding in Algold Resources is now shares in Aya Gold of Canada, which acquired Algold a month or so ago. I've amended the thread header post, but haven't yet worked out what CAPD received in return. However, the Aya share price has done extremely well, having quadrupled in the last year and risen nicely in the last month:
Https://ca.finance.yahoo.com/quote/AYA.TO?p=AYA.TO&.tsrc=fin-srch
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26/3/2021
07:28 | shanklin: Link to this tweeted by CAPD overnight.
https://www.capdrill.com/news/white-paper-exploration-boom-in-west-africa-opportunity-or-challenge
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25/3/2021
08:38 | sphere25: Had to double check the opening price to make sure the eyes weren't deceiving, but CAPD has actually been marked down on that decent sized director buy!
I wonder how many shares we see on a morning that actually get marked down on a director buy like that. It is yet another bullish piece of news that the market refuses to give CAPD any credit for.
I guess we have to try to be abit bullish on news like that with CAPD. Another big clearout needed here judging by the way the shares are being fed into the market. Perhaps Aberforth will take another big chunk?
All imo
DYOR
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24/3/2021
08:27 | shanklin: CAPD don't support RSG in Ghana, as per https://www.capdrill.com/media/investors/Presentations/CAPD-FY-2020-Results-Presentation_20210318_FINAL.pdf
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19/3/2021
07:29 | rivaldo: CAPD got a rather bullish review on Stockopedia last night in Paul Scott's Small Cap Value Report by Jack Brumby. It concluded as follows (a bit misleading to use the full 17.6c EPS including the investment gains, but I guess he's a newbie to CAPD):
"Conclusion
These are strong results and Capital looks well placed for a continued pick up in Africa-based mining activity. I don’t think we’ve missed the boat here.
Some big institutions have been buying in and, given the results and outlook, the share price looks cheap. Diluted EPS of 17.6c puts the group on about 5.4x FY20 earnings.
Capital guides to revenue of between $185m-$195m for FY21 and demand for drilling services ‘has increased strongly from Q4 2020, building further in Q1 2021’. MSLABS is working at near full capacity across all major laboratories.
MSLABS also sounds interesting – this is a global provider of geochemical lab services serving the exploration and mining industries. There could be growth potential here.
Given the buoyant outlook the shares do look cheap at the moment and I think it’s well worth spending a bit more time getting to know this company.
True, at some point there could be a downturn in mining activity, but there seems to be a disconnect between the positive outlook and today’s share price even accounting for the 10% rise."
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18/3/2021
13:27 | rivaldo: Hastings has updated just now - excellent as ever, except I might have added that the 17.8c EPS for last year does include the exceptional investment gains.
But CAPD remains exceptionally cheap imho given the prudent 10.2c EPS forecast this year and everything else already said here:
Https://martinflitton1.wixsite.com/privatepunter/post/capd-delivers-excellent-results-18-03-21?postId=605332bb223bc400575dc161
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18/3/2021
09:41 | rivaldo: Tamesis have issued a new note. They maintain their 127p target price and their 10.2c EPS forecast for this year, with a 2.4c dividend:
Https://www.tamesispartners.com/research-portal#/portal/tamesis-partners/research/02461d34-5f21-4f56-aa54-d51403022041
"Near term price target maintained at 127p/share
Features of the investment case include; sector beating growth generated from multiple sources diversified by geography and business type (the company’s lab business also won its biggest contract in 2020). The background remains powerful with exploration expenditure rising and the potential for more large-scale mining work high. As such it remains a mystery why Capital Ltd trades on the multiples it does; 2021 and 2022 EV/EBITDA multiples of 2.5xand 1.9x respectively, PERs of 8.3x and 5.5x and a dividend yield of 2.8% for 2021. We maintain our PT at 127p/share, representinga sector average5x 2022EV/EBITDA. We see this as conservative given both the positive backdrop to the industry and Capital’s competitive advantages to leverage thereof."
Sundance13, remember that there are additional shares in issue due to the fundraising - 189m or so compared to 138m last year.
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18/2/2021
11:57 | dangersimpson2: It is a bit of a mystery really - there clearly was excess demand for shares at 58p in the placing - we know this because the placing was upsized and investors were significantly scaled back.
So why did they upsize the placing? I suspect this is because they expect to win more large contracts going forward and having had to pay down debt through the last cycle they are keen to avoid debt where possible. The extra $10m give them significant scope to bid for extra business.
Why aren't those who bid for excess stock in the placing buying now? They may be, but simply be less aggressive than the sellers so the price stays flat. But I expect there is also an aspect of people being bored - this affects fund managers as well as PIs - look at all the current "hot" stocks - they get bought by traders because they are going up not because any fundamentals have changed. In the current market, if CAPD went up 20% in a day it would go up 50% the day after - and we wouldn't be complaining ;-)
Why do we have sellers who seem happy to sell at one of the cheapest valuations in the market for a company growing rapidly? Take Sustainable Capital, for example, they had 7.6m shares, bought around May 2018 for c.40p. They announced they now have 4.1m. Maybe they disagreed with the placing, didn't get their allocation and that made it immaterial for them or they faced redemptions or simply changed manager or strategy.
Why did CAPD not sell their equity holdings? I think this is because they are primarily a business development strategy. They provided capital to the best clients when no one else was interested and hence developed a business relationship where they get all the ongoing drilling contracts, which are now funded by a market that is much happier to invest in such companies. Keeping the holdings keeps generating lucrative contracts. And they never expected these holdings to become 20% of their market cap - this was simply a function of gold companies doing well for a period and the market inexplicably not re-rating CAPD's market cap as the outlook improved.
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29/7/2020
22:56 | rivaldo: You've misjudged my rubbish techie skills deanowls :o))
Nice mention for CAPD in today's monthly SIF portfolio review on Stockopedia (what does SIF stand for?) - CAPD are a core holding:
Https://www.stockopedia.com/content/sif-july-review-gold-price-provides-a-welcome-boost-capd-hat-bhp-645003/
"Capital (LON:CAPD)
(Original coverage: 02-Jul-2019)
This is the AIM-listed gold mining services contractor formerly known as Capital Drilling. It’s been in the portfolio for a full year now, and has been covered in several previous monthly reviews (April, May amp; June).
As I’ve discussed already, I’m having to fight against my instinctive desire to take a profit here. The shares are now at the highest level seen since 2011:
Luckily my rules are on hand to guide me. Capital continues to look affordable, with decent growth prospects.
P/E ratio (f) : 8.9
PEG ratio (f): 0.6
EPS growth (f) : 16.4%
Dividend yield (f) : 2.72%
Quality metrics are impressive, too:
Return on Capital : 18.4%
Return on Equity : 12.7%
Operating Margin : 14.49%
The shares still pass all of my screening rules, except for the lumpy spread, which I don’t see as a reason to sell:
So far, this position has delivered a total return of more than 55% including dividends. I’ll continue to hold the shares for another month."
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21/5/2020
09:15 | rivaldo: There's a terrific summary of CAPD from March 15th 2021 here:
Https://smallcapslife.substack.com/p/drilling-into-capital-limited
Latest forecasts are:
- year to 31/12/20 : 9c EPS, $28.9m EBITDA, $16.6m PBT
That's around 7.3p EPS this year, giving a P/E at 60p of only 8.2.
Tamesis Partners "value Capital Drilling at 99p/share, and maintain our target price of 100p. This represents 5x forecast 2020 EV/EBITDA of US$28.9 million"
Quite apart from excellent trading prospects as per the recent Q1 trading update:
Https://www.investegate.co.uk/capital-drilling-ltd--capd-/rns/q1-trading-and-covid-19-update/202004160700048535J/
CAPD also has substantial tangible asset backing against its £79m m/cap at 60p of (as at 31st December 2019):
- $4.4m net cash
- $12.5m of investments, split roughly evenly between publicly quoted and private companies
- $52.9m of property, plant and equipment, mostly drilling rigs
CAPD provide services almost wholly to gold producers, with very little exposure to more cyclical gold exploration. It's been unaffected by COVID-19, with all of its gold producing clients operating normally.
The gold price is as I write at multi-year highs at around $1,740 and is forecast by most to stay at high levels for some time to come.
CAPD's non-drilling services are also growing fast, including a first mining services contract for Allied Gold recently commenced covering exploration, grade control and blast hole drilling, mining equipment hire and service, and management services. CAPD also provide mineral analytical services as well as maintenance services. Non-drilling revenues were 12% of total revenues in Q1 2020, up from just 4% in Q1 2019.
Since 31st December 2019, CAPD's investment in Predictive Discovery on the ASX has rocketed. CAPD invested $350,000 at 0.009 AUD. They own 90m shares in total, or 14.69% of PDI. At the current 0.074 AUD quote this is now worth $6.7m AUD, or around £3.6m.
CAPD's investments of which I'm aware include:
- Predictive Discovery (PDI:ASX) - 90m shares worth £3.6m @ 0.074 AUD
- Cora Gold (CORA: London) - 8.7m shares worth £610k @ 7p
- Golden Rim Resources (GMR:ASX) - 76.9m shares worth £260k @ 0.006 AUD
- Arrow Minerals (AMD:ASX) - £450k (110m shares) +options invested at 0.01 AUD, now trading at @ 0.006 AUD
- Firefinch Ltd (FFX:ASX) - 9.5m shares, cost A$900k plus 5.625m options @ 0.015 AUD, now trading at 0.009 AUD (formerly Mali Lithium)
- Tanga Resources (TRL:ASX) - 13.3m shares, invested at 0.03 AUD, now trading at 0.019 AUD
- Aya Gold (AYA.TO), which acquired Algold Resources (ALG.H:TSX) (CAPD held 3,874,692 ALG shares (14.25%), now trading at 0.13 CAD
- Awale Resources (ARIC:TSX) - 8,333,334 shares (12.18%) invested at 0.09 CAD, now 0.1 CAD
- Desert Gold (DAU:TSX) - 6,200,000 shares (5.7%), trading at 0.17 CAD, worth £620k
- Marvel Gold (MVL:ASX) - 22,793,083 shares, trading at 0.052 AUD, worth AUD$1.2m (formerly Graphex Mining)
Current customers include AngloGold Ashanti, Acacia Mining, Algold, Barrick Gold, Centamin, Khoemacau, Kinross, Rakita Exploration, Resolute and Tanga Resources.
Https://www.capdrill.com/about-us/at-a-glance
"At Capital, we provide full service drilling solutions to customers within the global minerals industry, focussing on the African markets.
Our drilling services include: blast hole, delineation, directional, exploration, grade control and underground drilling.
Our range of ancillary services includes: directional software; shot loading and firing; surveying and geophysical logging; mineral analytic services; and on-site safety monitoring systems."
"Capital Drilling is one of the largest diversified drilling companies globally. Our extensive fleet enables us to provide drilling services across all phases of the mining cycle, from greenfields exploration to mine-sites, in both surface and underground mining operations. "
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PLUS1
