Solgold Share Discussion Threads

[rougepierre] 13/10/2020 10:53

OK so I took some off the table yesterday at 42.7p for a stinking profit but...

Yes it does happen occasionally when two MMs are different ways on the book...

I was quoted 37.75p to sell 200,000 and 37.75 to buy 10,000...so I bought back 77,443 at under 38p...

We shall see....

GLA

[mam fach] 13/10/2020 10:02

Very true. Easy to panic people who are in for a fast buck.
They soon move on to another share.
Nice that we are mostly long term holders.
Next RNS will make or break us.
GLA Solgers.

[lowtrawler] 13/10/2020 10:02

There is always the danger that a tree shake is actually preempting bad news. In this case, I doubt it. If we don't climb back over 40p by close today, I'll be slightly more concerned.

[bogotatrader] 13/10/2020 09:58

Traders and weak holders out....onwards and upwards...

[lowtrawler] 13/10/2020 09:55

Mam Fach, tree shakes are going to be a regular feature for a few months. They always are when factual information is scarce. It's a lot easier to scare people when they are trading on gut instinct than when they have hard facts.

[mam fach] 13/10/2020 09:51

If there is such a thing as a 'tree shake'
I think we just had one.
Who'd have thought another buying opportunity.
Going to be a fun few days.

[lowtrawler] 13/10/2020 09:39

MK, as per yesterday, I just think news is being released for maximum effect. They likely could have made a Porvenir RNS but make a series of rapid announcements in the hours before CGP have to decide:PFSOutline fundingLa HuecaPorvenirTaking up the extra $50m FNV fundingIf all these are positive, 50p by close tomorrow?

[bettsspitefire] 13/10/2020 09:30

Lowtrader. You are not the only one who thinks the price is a buying opportunity looking at some huge buys that are going through. My instinct says there is more to come, and this instinct was perhaps why I bought shares initially in solg at below 3p.

[mknight] 13/10/2020 09:26

Lowtrawler

I think many including myself was expecting some news yesterday on Porvenir so when it has not come out many think the worst so with huge profits they have sold some which is normal . Not sure the Mm,s are taking advantage unless they know something we dont .

For what it is worth i have not sold any as there is too much going on at present to form an opinión one way or the other.

[arcadian] 13/10/2020 09:26

JL

Thank you for you lengthy contributions. The FNV price paid is a useful guide. The tricky bit for us investors is converting it into an assessment of risk and how much to take on the information we have,

This is where Lowtrawler makes a sensible and valuable contribution given the information flow against the market backdrop and the potential for price movements up or down that will follow drilling announcements.

[lowtrawler] 13/10/2020 09:21

I could make the usual platitudes of this being a great buying opportunity or how it's healthy for some limited retracement. The reality is, hard facts are not yet available to us. We are trading on instinct.My instinct says good news is on the way and this is a tree shake. The MM's are very short on stock and need to scare some to be sold.

[dozyduck] 13/10/2020 09:20

FGS jL ! FNV did NOT value Solg. It valued what it estimated will be 1% of Alpala's (maybe also Cascabel's) NSR over its life. (In fact we don't know what its estimate was. It merely persuaded a cash strapped Solg to hand it over for $100m). You ought to be more precise in your reasoning.

[jlondon] 13/10/2020 08:48

PRICE PREDICTION:
Price predictions for stocks in general is seen on most forums and whether by experience or by charting, this is quite normally seen.

VALUATION:
That is where broker reports come in and the normal method will be via NPV etc.
This is an accepted method. On GKP, the complaints went to the FCA officially and the 1st thing asked was: What did the broker report say. This is due to the fact that the broker is licenced to be able to do the cals.

In particular, for Solgold, John Cronford has talked about the cost of the project and therefore, in reality the NPV will not be as high & he suggested that it should be 50p in a take-out {M & A dept would do cals]. However, he also ended his article by saying that should Solgold be able to emerge [para phrased], then the valuation could be US$2bn {£1.5n}


John Cronford, I believe was a former investment banker. In NORMAL CIRCUMSTANCES, I cannot disagree as the valuation of the potential sale price is compelling provided the prices of gold and copper does NOT rise from his cals.

I chanced on the FNV deal price for the $100m deal with Solgold in a broker report.
It came about as an exmple of M & A etc and was used to show the principle of benchmarking.

On the London South East, this was also stated on Sun, 11 Oct 2020 and therefore, it has "SLIPPED OUT" as I am quite sure this was under NDC as norm.

I posted this on this forum because DD talks about NPV and the realities shall we say of it coming to be realised - this is about Alpala [pre-funding].

FNV
I think that now the price of USD $ 3 b i l l i o n [£2.3bn = £1.0855p] is now firmly out in the open and therefore, this was an ACTUAL DEAL PRICE PAID.? Solgold has NOTHING except Alpala to offer at this time. NO ONE will put up money for 0 and therefore just as DGR*s fund manager lends, they want Solg/IRR stocks as security [per Hotcopper, Oz]. In return for the US$100m paid out to Solgold by FNV, they will now take 1% NSR. How FNV did the cals is up to their M & A team.

This is NOW REALITY as a benchmark for the Alpala project of being actually paid?
Hence, the OFF-TAKERS are ALSO GOING by this DEAL PRICE PAID although it is just under $3b from what I understand and which I have put past DD?

So, let*s be clear - this is NOT PRICE PREDICTION as above of price might do this or that as normally discussed in all stock chat forums.

This is AN ACTUAL DEAL BY FNV which somehow "got out" and publised by people who couldnt keep it in. NOW, OFF-TAKERS ARE THOUGHT to be following this although a bit lower??

MYSELF
I have Solgold stock and I have to have my feet on the ground for myself. Therefore, in this situation, the FNV benchmark is insightful. For others, they must go with their own insight etc and make their own decisions. The fact that this has come out into public domain can be only good for investors as it is not normally disclosed. I am happy to learn of this and that my stock has been valued by FNV, a $23bn listed co. More so, now that off-takers are following this valuation. So, without further adue, I have finished this topic which is to the BENEFIT of all investors, NOT JUST MYSELF. However, if anyone is not happy at £1.0855p that FNV paid and followed a bit lower by off-takers [US$3b], that is up to them. Caveat: The $3b deal price should be checked with the relevant ...as a safety measure. Thank you.



Tues, 13.10.20

[greenelf] 13/10/2020 08:41

Glad you have finally understood that there is no 'correct' valuation.

[dozyduck] 13/10/2020 08:39

jL There's no such thing as a 'fair' value in this life ! There's only what someone might pay at a particular moment. And a buyer will have a different view of what is 'fair' than a seller (or any other buyer or seller) Broker analysts use any 'metric' that will help them sell YOU a share and 'pretend' that its 'fair'. That is all. The stock market is a market for buying and selling shares. Not for buying and selling companies or for valuing them. Its no different to any penny market.

[greenelf] 13/10/2020 08:31

Could also be an RNS logged and MMs taking advantage? You never know, all is fair..

[greenelf] 13/10/2020 08:26

There will be some back testing of share price and profit taking. Quite normal and healthy. News going forward will determine the position and strength of new base level.

[oli12] 13/10/2020 08:18

Anyone selling because they expected an RNS to come out this morning is probably right to do so on the grounds that their investment case is likely speculative.

[mknight] 13/10/2020 08:12

Poor play by solgold this AM should have had an Rns out on Porvenir . Many selling off thinking its not as good as was previously thought .

No doubt we will get one this afternoon or tomorrow am .

[mam fach] 12/10/2020 23:52

None of us regulars are under any delusion that we can predict
future share price or events.
But this week will be pivotal.
Journey has been long but hopefully profitable.
GLA

[lowtrawler] 12/10/2020 23:36

We really need to stop pretending we can be remotely accurate with our price predictions. Any predictions, given the current state of uncertainty, are prone to personal bias and assessment. We have a slightly better chance of determining if the price is more likely to rise or fall. The news pipeline for SOLG points to an expected stream of good news and the current valuation barely represents fair value for Alpala on it's own. For these reasons, I believe the price is far more likely to rise than fall.

At what point would I start to lose confidence in the direction of travel? With the information currently available to us, I would start to waver around 60p. However, as more Porvenir holes are drilled and as we get better visibility of Rio, not to mention the PFS and potential outline financing, I expect the wavering point to increase fairly rapidly. If Porvenir and Rio can be confirmed as both open pit and with major resources, wavering point could even reach 100p over the next 3 months.

If Porvenir and Rio are both larger than Alpala, Open pit and have MRE's produced by Q2 next year, more accurate valuations could then start to be confidently applied over 100p. Until then, we need to be honest and say we are valuing based on gut instinct and our own imperfect models. Patience is still the name of the game, more information will be revealed in the next 6 months and will hopefully justify a 3 figure share price. Until then, we are still dreaming.

[jlondon] 12/10/2020 22:10

DD
I think there is a difference in opinion which is fine. As for the MM*s re-rating the stock to price discovery level, I am sure you are aware of practice. Yes, its buyer and seller but if the stock is bought up strongly, then it rises. I am also sure you are aware of the practice on ground level - say a stock has a good RNS, seems like no price can be quoted for anything above 1,000 at times. Sometimes, one whole morning one cant buy stock. Surely there must be sellers if the shares are marked up?


I am not new to investing. I am asking about the theory.

You are of the opinion that the $100m FNV deal was a ONE OFF? You did not DENY that the off-takers for Solgold are also pricing the deals at NEARISH the FNV $3b valuation?

In fact, you did not agree even at 55p fair value, if I understood you correctly - you talked of cost etc but you would NOT be drawn to the price level.

You said that $35/oz was wrong but now we find that $3bn for 85moz gold per Mather does work out to $35/oz?

Can you therefore CONFIRM that this new price discovery is NOT CORRECT as a VALUATION bench-mark?

At ARS, Liberum*s broker reports mention that the bench mark for BKZ etc is one in which an Australian co was taken out for?

As I said, I asked and I will check further on this. If what you say is correct, then the buy-out price if at 55p - then one can ask if this is "FAIR VALUE."?

That is my understanding of "FAIR VALUE" - once price discovery is known?

One thing I am sure of - if there is EVER A BID, we will then KNOW FOR SURE if "fair value" is established via the "price discovery" of the FNV deal and by EXTENSION, possibly the off-take.?

This is a subject for the specialists in "COMPLIANCE."

Thank you. I am off now.

12.10.20

[dozyduck] 12/10/2020 21:57

JL What are you talking about ? The $100m FNV deal was a one off. That's how FNV operates. It has no implication whatsoever for whatever anyone would pay for the whole of Alpala. All the rest of the market knows that. You seem very new to investing.(And its not the market makers who 'officially rate' a share. Its the buyers and sellers - and they invest or disinvest or trade acc to their own lights and timetables. Its why shares fluctuate - often wildly !)

[jlondon] 12/10/2020 21:46

MARKET MAKERS

The market makers will be also now be cognisant that FNV "officially valued" Solgold*s Alpala project at US$3 billion [equates to £1.0855p PER SHARE] in an actual deal. This valuation is inclusive of the funding risk?

The cat is now out of the bag per my last post?

Any suitor will be also aware of this as it is now "widely" known?

If any suitor wishes to tender 55p for Solgold shares a buy-out price, I think that it could be not looked upon favourably when there is now "PRICE DISCOVERY" in theory?
Investopedia: " Price discovery is the overall process, whether explicit or IMPLIEDLY, of SETTING the spot PRICE of an ASSET, SECURITY, commodity."

By extension, do the market makers now start to re-rate Solgold shares nearer to the "price discovery" level? After all, the off-takers could also be following this new price discovery level within a % variance?

If the Solgold shares are NOT re-rated as they should be [pre-funding price], then
there could be a "false" market? That is the theory? Anyone who is aware of the price discovery will then buy up the gap between 41p+ to £1.0855p as "abitrage"?

So, any MM - market care to comment relating to this rather unusual situation? I am asking because I have never encountered this before? Thank you.

12.10.20. @9:51pm

[lowtrawler] 12/10/2020 21:03

LF, they need to offer SOLG first refusal on their ENSA shares and so they can't just sell into the market. If they fail to accept on Wednesday, there is very little chance of them doing better in the future. The 15% holding is really only of value to the owner of the other 85%.