Goldstone Resources Share Discussion Threads

[marketanalyst1] 17/6/2020 10:18

In my last post, I cautioned private investors not to fall for the 'head fakes'. Well, today, some of them did and, consequently, lost their shirts at 3.75p.

And within a span of 15 minutes, the price had moved from 3.8p to 4.3p, with the City boys flushing out all the weak holders to get their hands on limited GRL stock; classic text book antics that work over and over again, and that repeatedly suck-in gullible punters.

So, for those new to GRL, here's a recap (of my previous post) of what's at stake:

The company’s current market cap is £10.50m (4.2pence per share). Allowing for cash and cash equivalents of £3.5m (does not include the £2.1m gold loan available for drawdown before June 30, 2020), the market appears to be valuing the company’s flagship asset, the Akrokeri-Homase Gold Project (AKHGP), at £7m.

Think about that for a moment...

£7m, against a current post-tax NPV of £23m (at US$1,735/oz gold price), is simply ridiculous!

But it gets worse…

The £7m valuation assigns ZERO value to the asset’s significant post code; AKHGP lies 7 miles along strike from AngloGold Ashanti’s Obuasi Mine which is targeting 350,000 ounces of gold production in 2020.

The £7m valuation assigns ZERO value to Paracale Gold and BCM’s presence on the BOD. PG and BCM are globally renowned, hardened, and highly respected gold investors who collectively own 48.2% of the company.

Finally, the £7m valuation assigns ZERO value to the fast approaching inflection point – gold production. Remember, Ghana's EPA is due to issue the Environmental Permit imminently. The issuance of the EP will then trigger the immediate commencement of mining operations. So gold production (and subsequently cash flow) is likely to commence next month.

Thus, the shares, which currently represent an extraordinary market anomaly, should be trading at 12pence per share (fair value) ahead of any production news.

However, that being said, and valuing the company on a DCF (Discounted Cash Flow) model once cash flow commences, throws up significantly higher values.

In the meantime, all the factors for a $2,000-plus gold price are firmly in place:

• Global GDP is anticipated to slide 3% this year; triple the slowdown in economic activity during the Great Recession.

• The US national debt in November surpassed $23 trillion. Gold rises proportionally to debt.

• The debt piles of countries across the world are rising fast as they wrangle the coronavirus. A second wave now appears a real possibility.

• The US budget deficit this year is expected to reach nearly $4 trillion, after Congress pumped about $2.5 trillion into the economy to stem the bleeding from coronavirus lockdowns.

• A yield curve inversion, when short-term yields push higher than long-term yields, is a predictable recession indicator. On March 9 the entire US yield curve fell below 1% for the first time ever.

• A new round of quantitative easing, $700 billion in asset purchases, was changed to “unlimitedR21;. The Fed also announced a $300 billion credit program for businesses and consumers. That was followed by a $2.3 trillion lending program announced on April 6, whereby the Fed can purchase up to $600 billion in loans, buy downgraded corporate bonds, and purchase $500 billion in bonds from state and municipal governments.

• The unfettered printing of fiat currency by the global Central Banks is gathering pace with each passing week.

Thus, disregard the ‘head fakes’ (MM antics), that will undoubtedly be popping-up as the City boys run thin on stock (small free float), and go LONG.

Howard Stanley Marks, the serial value investor and founder of the multibillion, wealth management firm Oaktree Capital Management, once opined that:

"All intelligent investing is value investing — acquiring an asset for less than its value means seeing what everyone else sees and thinking what no one else thinks."

ATB and stay safe.
.

[spacedust] 17/6/2020 09:54

Geared I hope the share price flies on permit news but if history tells me anything about grl what is likely to happen is the share price drifts towards 3.5p

Then permit news is announced and we are back to 4.2p only to see it drift back down below 4p.

This has been the course of action in grl for decades

[highly geared] 16/6/2020 23:31

Just re reading the 16th March RNS on funding. It states the environmental permit application is submitted and expected to be approved within 3 months. So, we’re exactly 3 months ago, so it should be imminent.

The RNS stated that Mining will commence immediately on receipt of the permit. So, there’s a possibility that contract mining starts as early as next month...

[stonesp2] 16/6/2020 15:20

I've been in this for several years now since the share price was in the doldrums and have traded a little. Essentially this looks to be turning the corner and it's great to see a profit.. may even slice off some as we go but no more than say 40% ... got to stay in this for the medium to long term ...

[spacedust] 16/6/2020 14:19

Thanks anley doing utmost best to stay positive as you'll clearly remember it's been similar situations decades ago when we had the likes of Bendigo mining taking positions at premium then in came stratex mining.

But the main difference we are producing so hopefully the rvenue generated will mean no more dilutions

[anley] 16/6/2020 13:51

KCACO....do not try and be a trader just buy because you have researched a stock to the best of your ability and remember how to take cut a loss.

GRL is run by a women who has been morally supported by 2 big shareholders who have let her reorgainse the business and clean it up. All this has taken her nearly 2 years and now at long last she is at the starting gate.........so well done her and now as she has told the market "this is going to be a different story".

HighlyGeared as spelled out the figures in previous posts and I support them. £11m M/C for the assets the business has to which one should add an estimated figure for the cash flow once the production gets going......and that could make the shares worth substantially more than 4p+.

Lastly there is a position being unwound and once this has gone and the permits announced in a few week then the share turnover should reflect this good news.

Hope this helps.............

[kcaco] 16/6/2020 13:22

Thanks guys . I suppose it’s knowing when to take a profit and then buy back in or buy elsewhere or whether to hold long term.
I’ll give it a year . GRL is moving up a bit yeah .

[spacedust] 16/6/2020 13:12

I need to sell 3 more aim companies then I'm put of them for good never to return to aim companies ever again

I'll stick to the likes of
barcs and bp
glencore
Bt
Iag
Lloy
Fres

Etc etc

[spacedust] 16/6/2020 13:10

I've made money from ftse 100 and 250 companies. Infact I've hardly lost money trading big companies.

I've lost 90% of investments in rubbish bucket shop aim companies and over the last 2 yrs I've been selling aim dogs. I recently broke that rule by adding grl.

I've made profits on 95% of investments when trading in big ftse 100 and 250 companies.

Trading in aim is excite g when u get one right after decades. Ftse ones are boring but you make small amounts regularly.

[kcaco] 16/6/2020 12:27

Thanks .i am actually a bit longer than 10 days !!! Lol ... but I get your point . I was actually in before last weeks rise .and then I bought some more last week . I’m still below today’s current share price . Having twice previously lost shed loads of money from stocks and shares many moons ago through investors investments on my behalf ...I’m extremely cautious. It would be nice to get a good riser and have a stock make some good money Even just for satisfactions sake. !!!
I know it’s not instant and patience is the game but I’ve never actually ever met anyone who has said they have made money from stocks and shares . Obviously people do .
( I hope )
Anyway I like Emma Priestley when she has been interviewed and the 2 x main shareholders seem strong and Gold is on the up so this seems good . Thanks for all the advice .

[spacedust] 16/6/2020 11:55

Dep3nds if you're comparing to me then you can say you're a newbee for the next 10 yrs.

Also i personally don't expect the share price to move too much once permit is given the green light.

If any other aim company had a sniff of randgold being a partner the share price would have shot up 100s of percentage point but no not grl.

This share is hated by MMs for whatever reason. During the 2009 gold boom the likes of

NGL shot up from 1p to 80
Solg 2p to 80p
Marl 2p to 70p
Grl 2p to a measly 12p max.

When grl was 4p they did a placing at a premium where by bendigo mining bought shares at 6p premium.

Like I said I will No doubt sound like a deramper but I can assure you I'm speaking from direct first hand experi3nce of b3ing in this dog for decades and have only been disappointed.

I truly hope that I just break even which will be a miracle but I maybmeed to hold for another half a decade

[highly geared] 16/6/2020 11:47

Wait for the environmental permit to land and this will move up. It’s due in the next few weeks ( based on the 3 month anticipated timescale). Once received, they can commence mine build, which should be relatively short due to simple set up. I’m hopeful they’ll be mining by Q4. Meanwhile gold is $1730 and going only one way over the next 5 years. Try holding for 10 months rather than 10 days and you’ll should do very well here.

[kcaco] 16/6/2020 11:12

Hi . I thought this was meant to rocket this week ? . I keep saying I’m new to this but I am .( how long can I keep saying that for ...maybe a year ? ) Has this been ramped ? Ramping and de ramping what exactly is that ? I see lots of positive and negative comments but what difference do comments actually make ?

[stonesp2] 16/6/2020 10:35

Thought as much ...

[flashheart] 16/6/2020 10:16

Just another cretin Stones. He was already filtered as he has history.

[stonesp2] 16/6/2020 10:13

You're having a laugh ..

[borisjohnsonshair] 16/6/2020 09:57

Under 1p it might be of interest.

[gasman10] 15/6/2020 20:38

As Emma says a totally different company.https://www.voxmarkets.co.uk/company/GRL

[spacedust] 15/6/2020 16:11

Anley good too see some familiar names. Who were the others ? I only remembered big dog but now you pop up so I'm glad to be in the titanic with you all

[anley] 15/6/2020 15:40

Well put............Highly Geared

Looking to buy back at under 4p...................

[highly geared] 15/6/2020 13:02

Nail on the head Spacedust - was previously an explorer. The key thing here is timing. The POG has meant they secured finance and thus means they can commence production and generate real profits.

The last boom in 2009-12 was really about blue sky expectation on developing a big JORC at Homase and Akrokeri with a view of a JV or selling the asset to a major. The grades they got weren’t of interest to a major who wants to see 2 million oz minimum to consider it.

What we now have is a nice little starter mine with the opportunity to develop and expand the resource out of cash flow , deliver dividends and there’s the blue sky bit with the high grade intercepts along strike at Akrokeri which, if drilled further and they show good grades, could be of interest to our friends down the road at Obuasi...

[spacedust] 15/6/2020 12:15

Gladstone historically has never been loved by market makers so i hope that changed too.

[spacedust] 15/6/2020 12:14

It is now a producer rather than a explorer

[gasman10] 15/6/2020 12:02

Well Emma did say it was a totally different company now.

[spacedust] 15/6/2020 10:01

Ggp is infected with rumours. Grl had a partner like the mighty randgold resources and when that news was announced the share price saw no change.

I'll live in hope 99% and 1% expectation when it comes to grl.

Not bashing but from over a decade of direct experience invested in grl