Fresnillo Share Discussion Threads

[imastu pidgitaswell] 02/10/2020 10:08

?

We're talking two different things.

The debt and its refinancing or paying down is one thing.

The hedging of a small amount of its silver production is a different thing entirely.

[2603] 02/10/2020 09:56

There’s must be a good reason to put this in place and to reduce their debt. I personally think this will attract new investors which could be one of the reasons. Investors are looking for companies with no or little debt, there isn’t that many around at the moment especially with the growth potential this has got. I am in a gold and silver fund that Fres is in their top 3 holdings, I see this as very positive going forward for the longer term.

[imastu pidgitaswell] 02/10/2020 08:49

7% of silver production - so 7% of half the revenue, with cap and collar well away from current price. Not sure why they bothered.

[saint in exile] 02/10/2020 07:28

Its only 7% of production and the ceiling is $50!!

[plat hunter] 01/10/2020 22:18

Fres locking in gains but trader won't.The whole world including the company he loves is telling him, what an idiot.

[kennyp52] 01/10/2020 20:49

Henryxx ... desperation ?

[henryxx] 01/10/2020 20:44

Fresnillo,one of the world's biggest silver producers,took the rare step of locking in gains from silver's almost 50% rally this year,reports Bloomberg. Fresnillo said it has hedged 7% of next yr's output with a floor of $20 an ounce and a ceiling of $50 an ounce. Hedging has been shunned by investors who in the past spent at least $10Bn unwinding unprofitable forward sales when prices surged.

Read into that what you will.

[2603] 01/10/2020 19:41

Trader is right, this has massive potential once the Silver and gold bull run gets started. Its not just the US building up a stupid amount of debt but the rest of the world are too and with interest rates going nowhere for several years the metals can only rise in price. I think £20 is on the low side for this stock, if the Silver price slowly rises over the next several years then I will say that this share price will be around the £50 mark. Exciting time ahead.

[trader536] 01/10/2020 17:33

Looks like the idiot bus has stopped at Fres today

[plat hunter] 01/10/2020 17:04

57x times earnings and an fcf valuation of circa 970.Way way over valued, sniping stock only.

[trader536] 01/10/2020 16:07

Interesting to see how much of the stockpiled stoping ore from Juanicipio gets processed in Q3 and Q4 at these higher PM prices.

2000p within 12 months or perhaps sooner?

[imastu pidgitaswell] 01/10/2020 15:18

Bloody hell, you're thick.

How did net debt halve last year? How much operating cashflow did they generate compared with capital expenditure and dividends paid out?



Slide 38.



You're referring to H1 this year, when they had much higher operating cashflow thanks to higher PM prices. But even then, the net debt only reduced because they slashed capex given the liquidity crunch they faced at the start of the year and effectively stopped paying dividends. And the share price doubled, for which I was very happy, holding around 47,000 of these as I was.



Slide 35.



You just don't understand financials, do you? Or anything else.

[trader536] 01/10/2020 15:10

“silver and gold have moved to multi-year highs (but now off them)”

Those highs in the PM prices have yet to be reflected in PM stock earnings, dividends and share prices you moron.

Fres net debt almost halved last year on $16 silver and $1400 gold, these will be throwing off a ton off cash over the next three years.

Good luck with you failing banks and falling oil stocks you tool.

[imastu pidgitaswell] 01/10/2020 15:02

Even yesterday, on the other thread, he does his usual - displaying his ignorance of his own ineptitude with his comments on the debt funding buyback - failing to grasp the point at issue and showing with his own words a failure to comprehend basic finance.

In summary financially illiterate. And then condemns others for being 'economically and technically illiterate.' He does this time and time again - as per the other thread.

So I put this on this thread, as I'm just bored of the moron. But he just can't leave it.

Can't you just do yourself a favour, avoid demonstrating your stupidity and stay out of a discussion that you are not involved in?

[imastu pidgitaswell] 01/10/2020 14:38

I know - and it was almost the only share I was in just six months ago. Extraordinary times, extraordinary responses - and I couldn't think of a better company to be in in the circumstances. It worked, very well. So I know this company and its operations extremely well - all on the other thread.

All I am saying is that now, when this has doubled, when other businesses in other sectors have halved (and much more), as silver and gold have moved to multi-year highs (but now off them) it is not so clear cut (for me) to say there is no better share to be in.

I am just wary of everyone jumping on a bandwagon after it has already come a long way. For example, a vaccination breakthrough, likely over the next 3-6 months will change the investment landscape. Maybe it should, maybe it shouldn't - but it will. And when I see the world's largest hedge fund plugging an investment that has already performed the way it has over the past year or so, the cynic in me notices.

But it's going very well today - the 1200 support was definitely tested, but responding well.

[2603] 01/10/2020 13:58

Imatsu. I agree with some of your comments. mining shares are risky and volatile, this has been the norm. This is my 3rd gold rush, the difference I see in this one is there has never been so much money being printed not just in the US but world wide. The debt levels are at scary heights, possible negative interest rates/rates kept low for years. In my opinion Silver is very under valued compared to other assets, my main holdings is physical and I hold mining shares to get my leverage. You say Silver has gone up a lot? From what price, it touched $50 on the last rush. On the bear market It sold off far too much, I was expecting to go down to around $20, I mean it cost a lot to get out the ground. I feel we have got a good few years to go before this bull market has finished and I would rather own Fres. Than any financial stocks and I feel when we do reach new highs in Silver I can’t think of a better share to be in.

[imastu pidgitaswell] 01/10/2020 12:02

The trouble with that is:

Gold has already rocketed. As has silver. They are off their highs though. Maybe temporarily, maybe not.

The world's largest hedge fund is not run by stupid people. They were not 'going long' at current prices, they were buying it much cheaper.

Now they are telling the world to go long, for all the reasons in the article.

What do you think the world's largest hedge fund is doing with its holding?



I'm not saying that is how it is - but you can see the issue. Fortunately for me, I was long on here at the lows and am currently out. It (gold) could well go considerably higher. But it might not.

I get the money-printing dollar devaluation thesis. It has come to pass so far. But from here? Especially on a mining company with pre-existing operational, political and management challenges. And now a global pandemic which Mexico isn't coping well with.

(Incidentally, it quotes the police pension fund buying gold for 5% of its fund. What it doesn't say, but was reported in another article, is that the fund leveraged that purchase by borrowing, rather than sold some other assets. Borrowing to buy an asset that is (was...) at an all time high. Mmmm.)

Shades of grey and complexity. Tread carefully and don't assume it's one way traffic, despite what many would tell you.

[kennyp52] 01/10/2020 09:36

Trader536 cherry picks reports dependent on whether he is buying or selling . The share is off a high that was ramped by nutters like him . To counter his ramping ..

As stated in our production report of 22 July, we have revised our consolidated production guidance. Total gold production guidance was decreased to 785-815 thousand ounces (815-900 thousand ounces previously) mainly due to the COVID-19 operational restrictions at the Herradura district in the second quarter. Total silver production guidance (including Silverstream) remains within the range of 51-56 million ounces.

Investors are forward looking... until they get the production sorted the price will be volatile . Keep any eye on exploration and CAPEX ... eats cash .