Alacer Gold – Further Detail…

Posted on | by Leon Hinde

Alacer Gold provides an interesting growth opportunity. The company holds a significant portfolio of highly prospective exploration land holdings across Turkey (totaling approximately 125,000 hectares), some of which are progressively advancing to prospective projects.

The release of the CY19 financials show NPAT beat on a one-off tax adjustment, whilst revenue was in line. EBIT of US$171m was also broadly in line with market expectations.

The company has recent exploration success at Çakmaktepe & Ardich sites. We see scope for a material pickup in earnings from FY21. 

CIMIC – Dividends Set to Resume

Posted on | by Leon Hinde

We continue to see long-term value in CIMIC, supported by structural tailwinds within the infrastructure sector. The company recently announced they’re writing off 1.8bn and exiting their Middle East business to focus on Aust, NZ, and Asia.

Yesterday’s profit release was in line with guidance at $800m of underlying NPAT. FY20 is forecast to see between 1 – 6% growth and a new guidance range of $810-850m has been provided.

Dividends are expected to resume in FY20 and investors should be positive on the strong Q4 cash flow. CIM is trading on 11x forward earnings and a forward dividend yield of almost 6%.

 

ORG & BHP – Opportunity Approaches

Posted on | by Leon Hinde

Chinese energy importers are considering force majeure declarations as the short-term demand for energy is impacted by recent events.

A combination of weaker demand and lower prices sets up an opportunity for investors. Our preference is ORG & BHP and investors should average into any exposure by controlling the position size.

It’s still possible that a second wave of Coronavirus impact may materialize and markets may once again be under pressure.