17. September 2021 | 12:42 CET
Desert Gold, Barrick Gold, flatexDEGIRO - What is next after the correction?
Not always does an equation work out when investing in the short term. Patience and a longer-term investment horizon are not often emphasized for nothing. Investments in tangible assets such as stocks, commodities and real estate have been proven to protect against a loss of purchasing power. Precious metals are also suitable as crisis currencies over more extended periods. Setbacks offer opportunities! Who has the best cards?
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ISIN: DESERT GOLD VENTURES | CA25039N4084 , BARRICK GOLD CORP. | CA0679011084 , FLATEX AG NA O.N. | DE000FTG1111
"[...] I wouldn't be surprised if the project ends up showing more than 5 million ounces. [...]" Gary Cope, President and CEO, Barsele Minerals
DESERT GOLD VENTURES INC - Strategically advantageous acquisition
Desert Gold focuses on deposits in the West African nations of Mali, Ghana and Rwanda. The Company's key asset is the SMSZ project in southern Mali on the border with Guinea. Mali is Africa's fourth-largest gold producer. The SMSZ project is named after the Shear Zone between Senegal and Mali and covers 410 sq km. As such, the property is the most extensive contiguous non-producing land package in the region. Several Tier 1 gold producing mines are geographically close; these include B2 Gold's Fekola mine, Barrick Gold's Gounkoto and Loulo mines, and Allied Gold's Sadiola and Yatela mines.
Desert Gold recently increased the acreage of the SMSZ property by acquiring the 30.6 sq km Kolomba concession associated with SMSZ. The acquisition features two prospective gold zones. Highlights from past drilling include up to 16.03 g/t gold over 7m, 7.78 g/t gold over 19m and 3.51 g/t gold over 29m at the Linguekoto West zone. At the second zone, Mogoyafara, past drilling has revealed 2.04 g/t gold over 41m, 20.87 g/t gold over 6m and 1.40 g/t gold over 55m.
The strategic logic behind the acquisition is that additional mineral resources can be added to the SMSZ project. Modeling on the two new zones is expected to take place soon. The Company announced drill testing, geological mapping, geophysical IP and magnetic surveys for early 2022.
President and CEO of Desert Gold, Jared Scharf, commented, "The acquisition of the Kolomba property aligns perfectly with our strategy to acquire high quality, underdeveloped gold concessions along the Senegal-Mali shear zone. With the strategic location of the Kolomba concession and the quality of the exploration targets within its boundaries, Kolomba will be a high-priority target in our upcoming exploration season. It is interesting to note that the last time this property was worked was in 2003 when gold prices averaged USD 363 per ounce!" Indeed, with the acquisition, Desert Gold's prospects have once again improved, which will undoubtedly be reflected in the share price in the future.
BARRICK GOLD CORPORATION - Correction mode
The share price of the second-largest global gold producer has continued to plummet due to a weaker gold price below the USD 1,800 mark. Since the beginning of the year, the shares of the Canadian Company have already fallen by around 20%. The price development of the share is largely dependent on the price levels of gold and copper. Even though many experts forecast higher price levels for the precious and industrial metal in the medium term, declines are currently being recorded.
The Group recently allowed its shareholders to participate in the Company's success with an announced dividend of USD 0.09 and a special dividend of USD 0.14. In addition, Barrick confirmed its forecast for the full year. Thus, the weaker commodity prices should rather be understood as an entry opportunity. Analysts formulate, on average, a price target of about CAD 34.50 for the title. This results in an upside potential of more than 40%!
FLATEXDEGIRO AG - Increased insider purchases
The share certificates of the online broker have also weakened significantly recently. The share price has fallen in the last 6 weeks about one third. And this even though the Company recently reported the best half-year in the Company's history. Investors were partly bothered by the declining momentum in customer acquisition at a high level.
The recent 1:4 stock split also failed to provide any positive impetus. Analysts predominantly rate the title as a "buy" and formulate an average price potential of 77%. The 2022 P/E ratio is around 13. Executive Board member Frank Niehage has recently taken advantage of the depressed share price level to buy shares in the Company, whose stock is valued at EUR 2.2 billion.
Investing in tangible assets such as shares offers investors adequate protection against inflation. In addition, precious metals are considered a crisis currency. Investors can profit from rising precious metal prices, for example, with the major player Barrick Gold. Those who like it a little more speculative should take a closer look at Desert Gold, which has an even larger land package in a promising region after the recent acquisition. In an environment of rising stock markets, the flatexDEGIRO share should also recover soon.