July 30th, 2021 | 10:12 CEST
CureVac, Desert Gold, Steinhoff: Here, gamblers get their money's worth
Where can speculative investors still find returns today? Are they bankruptcy candidates? Companies deeply entangled in legal disputes? Or fallen angels? Or are they small companies with a clear vision and experience in growth projects? We do the check and present three stocks.
time to read: 3 minutes
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Author:
Nico Popp
ISIN:
CUREVAC N.V. O.N. | NL0015436031 , DESERT GOLD VENTURES | CA25039N4084 , STEINHOFF INT.HLDG.EO-_50 | NL0011375019
Table of contents:
"[...] We knew the world was rapidly electrifying and urbanising and needing significant amounts of copper to do so. [...]" Nick Mather, CEO, SolGold PLC
Author
Nico Popp
At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.
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CureVac: What could happen next?
For many months in 2020, CureVac, based in Tübingen, Germany, was seen as Germany's vaccine hopeful. In public perception, CureVac even traded ahead of BioNTech, the competitor from Mainz. But then everything turned out differently. BioNTech pushed through its clinical trials and benefited from the fact that there were still no significant virus variants at the end of 2020. CureVac waited, wanted to make everything perfect and thus wasted necessary time. In the end, the vaccine against Covid-19 from Tübingen achieved an efficiency of only 48%. That led to a crash on the stock market. Since then, the shares of CureVac and BioNTech have been acting as if they came from different industries.
BioNTech is rising after the announcement of a malaria vaccine, and CureVac is bobbing along. But is CureVac really that much worse? Because of the vaccine disaster, CureVac is missing out on some sales that the market had priced in over the past few months. That has caused share price losses of around 54% in the last three months. However, if you take a long-term view of the stock, it is currently trading at the level of early November 2020, which is when the big vaccination hype started. Since CureVac has a lot of experience with the promising mRNA technology, the Company should not be written off. But the Tübingen-based Company gambled away trust. CureVac should show that it can put its horsepower on the road.
Desert Gold: Growth stock still on course
The Canadian Company Desert Gold has already convinced the market. In 2020, the share was one of the most dynamic in the entire gold sector, climbing from CAD 0.09 to CAD 0.33 within a few months. Desert Gold operates in Mali and is advancing the SMSZ project there. The name stands for Senegal-Mali-Shear Zone and represents a promising gold belt where Desert Gold holds a 410 km² land package. Surrounding it are already producing mines with an output of about 600,000 ounces of gold annually.
Desert Gold's drill results read impressively: 3.65 g/t gold over 42 meters and 6.28 g/t gold over 13 meters speak a clear language. The SMSZ property is considered an advanced exploration project as large sections have already been drilled. In 2021, Desert Gold plans to drill a total of more than 20,000 meters and has already funded this drill program. A resource report is expected to be prepared in the fourth quarter in accordance with international mining standards. Mining giants such as Ross Beaty and Leede Jones, among others, believe in the project. In addition, other institutions are also involved. The share has fallen back significantly in recent months and must be considered speculative, but the Company is still on course and offers the opportunity for momentum.
Steinhoff: Does anyone still see through here?
Steinhoff has also been dynamic in recent months - but in both directions. Years ago, the South African furniture group was involved in an accounting scandal. The Company is still involved in legal disputes. It has been going back and forth for months. Hopes of a settlement that would give the Company a little more leeway again alternate with setbacks. In the meantime, even the auditor at the time has become the focus of legal disputes. While investors still had hope a few months ago, no one at Steinhoff seems to be able to see through the situation anymore. The flood of legal proceedings makes any speculation seem crude. The share has recently lost ground and is now trading below EUR 0.10. The value is only for lawyers or hardcore investors. But even they should wait for the risk buffer to become somewhat bigger.
No matter how you turn it around: The Steinhoff share is a gamble. CureVac, on the other hand, looks better. The Company understands mRNA technology but was recently punished and has lost confidence. Desert Gold is entirely on course, and here, the cyclicality is part of the story. The promising SMSZ project continues to be explored, and the renowned major investors continue to keep their feet still. Since the share has not yet risen sharply, experienced investors can gradually seize opportunities here.
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