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August 9th, 2022 | 12:36 CEST

Buy after the price slide? Tocvan Ventures, Palantir, Bayer

  • Mining
  • Gold
  • Technology
  • Investments
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The stock markets have continued to move upwards since their lows in mid-June, with the DAX easily breaking the 13,600 mark. The precious metals and crypto markets also look sunnier in the hot August. One reason for the good mood, in addition to the pleasant temperatures, is the positive course of the reporting season for the second quarter. Still, there are outliers to the downside that represent a potential long-term buying opportunity despite below-forecast numbers.

time to read: 4 minutes | Author: Stefan Feulner

Table of contents:

    Dennis Karp, Executive Chairman, Manuka Resources Limited
    "[...] We will trigger indirect creation of 1,665 new jobs nationwide, while directly employing 300 staff - 270 operational and 30 administrative. [...]" Dennis Karp, Executive Chairman, Manuka Resources Limited

    Full interview


    Tocvan Ventures - Gold bottom found?

    In the case of gold exploration company Tocvan Ventures, the loss of around 60% is not due to missing any forecasts but rather to the fallen base price of gold. That smaller companies underperform in a longer falling overall market is the rule rather than the exception. On the other hand, it is precisely such stocks that are likely to outperform the gold price on several occasions and therefore act like a warrant compared to the overall market. On a fundamental level, things are going like clockwork for the Canadian gold and silver explorer, which owns two promising projects in the state of Sonora in Mexico. The Aztec state is one of the world's 10 largest gold producers with an annual production of around 102t and is the largest silver producer with about 6,120t per year.

    The Calgary-based company recently reported outstanding drill results at its flagship Pilar project. The property is located door to door with several of the largest producers, such as Fresnillo with its Mina La Herradura mine and Magna Gold's San Francisco mine. Following the completion of the last phase of drilling, a total of seven holes were drilled for a total length of 1,382m. Drilling focused on step-out targets along the 4-T Zone and a newly discovered trend between the Main Zone and the 4-T Zone. Initial metallurgical results were obtained from column leach tests suitable for analyzing potential gold recovery in various areas of the project. It resulted in an astonishing gold recovery of greater than 85% for all four samples. The grades of the ore samples ranged from 0.4 to 5.0 g/t AU, and the measured gold recovery ranged from 85% to 96%. TIn comparison, Argonaut Gold's adjacent profitable Colorado mine has a recovery rate of just 67.6%.

    In order to be financially equipped for the next drill program in the fall, the investment house Sorbie Bornholm was welcomed as a new anchor shareholder. The British company will pay CAD 5.125 million in 24 tranches over the next two years.

    For Tocvan CEO Brodie Sutherland, the entry of the strategic investor is a blessing. On the one hand, further dilution of the existing shareholders is now avoided for the foreseeable future. On the other hand, the drilling programs for the next two years and possibly beyond are now fully financed. Tocvan Ventures currently has a market capitalization of EUR 17.63 million. The quality of the two properties is promising. In the event of a sustained rise in the gold price, the Canadians could be among the outperformers.

    Palantir - The usual thing with earnings forecasts

    And from gold to data, which, as we all know, is the gold of the future. In the field of data analysis, Palantir is a company that sees itself as the market leader with the best platform. In addition to governments, the private sector also swears by the technology of the Denver-based company. With the announcement of the figures, the trend of the last quarters was continued. Like in the movie "and daily greets the groundhog", the stock sank into double digits after missing analysts' forecasts. At USD 9.80, the share is close to the upward trend formed in May. Should this be broken, an upward gap still to be closed from June 17 at USD 8.25 beckons.

    The team around the enterprising and controversial CEO Alex Karp missed the forecasts for earnings per share in the second quarter. The Denver-based company posted a loss of USD 0.01 per share. On the other hand, the analyst consensus puts the Company in the black with earnings per share of USD 0.031. Sales, on the other hand, climbed to USD 473 million compared with USD 375.6 million in the same quarter last year. Analysts were expecting sales of USD 465.8 million in advance.

    Another disappointment was Palantir's announcement of its forecasts for the current quarter. Here, the US company expects around USD 475 million, while the financial experts saw USD 498 million in revenues. The revenue estimate for the full year was revised to between USD 1.9 billion and USD 1.902 billion. However, it should be noted that major orders from the US government are not included in the forecasts. Given the uncertain geopolitical situation, Palantir's data analytics should gain more and more attention, and thus orders, not only from the US government. In the long term, the Company remains a potential multiple candidate despite the weaker than expected figures and the ambitious valuation.

    Bayer - Little confidence available

    Analysts praised Bayer AG for its strong quarterly results last week and for raising growth forecasts. However, litigation and provisions due to the glyphosate litigation still stand in the way.

    Also, additional approved use of Bayer's drug darolutamide in combination with docetaxel for metastatic hormone-sensitive prostate cancer (mHSPC) by the US Food and Drug Administration could work against the further falling quotations. Analysts at Berenberg Bank reiterated their "buy" rating on Bayer after quarterly results, with a price target of EUR 76. The results of the pharmaceutical and agrochemical group were mixed in light of the resolution of litigation and conglomerate discounts, respectively, analyst Sebastian Bray wrote.

    Following the quarterly results, data analytics specialist Palantir went into a dive and posted double-digit share price losses. In the long term, however, the title is just as interesting as the pharmaceutical giant Bayer. Due to a rising gold price, Tocvan Ventures has the potential to outperform.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Stefan Feulner

    The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
    He is passionate about analyzing a wide variety of business models and investigating new trends.

    About the author

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