July 13th, 2020 | 11:00 CEST
Desert Gold, Tesla, wallstreet:online - high share price gains through scalability
Table of contents:
Born and raised in Hannover, Lower Saxony follows social and economic developments around the globe. As a passionate entrepreneur and columnist he explains and compares the most diverse business models as well as markets for interested stock traders.
Gold boom returns
Experts assume that in the year 2020 the production volume of gold will have reached its historic peak at around 118 million ounces. From 2021 onwards, the quantity of new gold will decrease. By 2029, production is expected to shrink by 45% to around 65 million ounces per year. The reason for this is obvious, as the major producers have seen their reserves shrink by around 34% since 2012, and on top of that it is becoming more and more costly to bring gold mines into production. The value drivers of the industry are therefore companies from the exploration sector, because they ensure that new gold is found.
The listed company Desert Gold Ventures focuses on exploration in West Africa. The company has secured projects with an area of more than 400 km2 and is collecting data on further gold reserves. In the past, geologists have repeatedly discovered gold in different structures and concentrations. The current drilling program is now aimed at defining the sizes of the deposits already discovered more precisely and also at discovering further structures containing gold. Above a certain amount of gold, it is expected that the company will be bought by a producer. In 2018, more than 200.00 USD per ounce in the ground has already been paid in Africa in takeovers. Desert Gold holds the expectation of being able to discover up to 6 million ounces in the areas. It is expected that the first results of the current drilling program will be published in the coming weeks.
Survivable without taxpayer money?
Tesla produces battery cars and collects a lot of data about the drivers' user behaviour to offer different services. Government grants and subsidies also provide buyers with incentives to purchase the vehicle. However, the use of batteries in cars is not without controversy, and the additional demand for electricity for electric cars means that more coal has to be burned in power plants.
The CO2 emissions of electric cars with batteries will then rise to 300g CO2 per kilometre driven. This figure is over 70% from modern diesel engines (Source: Institute for the World Economy, Kiel, June 2020). For this reason, the use of the term 'environmental bonus' is misleading advertising, as in Germany only 45% of the energy mix consists of renewable energies. In China, new internal combustion engines are already being developed because the production of batteries, charging and disposal are an unattractive environmental footprint.
Analysts recommend buying
Around 75% of investors in German-speaking countries use the portals of wallstreet:online AG. For this reason, the company can advertise its own products and has a correspondingly high hit rate. In the area of online brokerage, the company has been offering a solution that is tailored to the majority of customers for more than half a year: 'Smartbroker'. The focus of the offer is on low price and security as well as flexibility. Users of the company's websites can already find information in many areas about the low-cost option when trading in funds and stocks.
The success is noticeable. Last week, the experts at MM Warburg increased the company's price target from EUR 75.00 to EUR 80.00. The sales estimate for 2021 was increased from EUR 33.76 million to EUR 36.86 million. For 2022, EUR 42.30 million is now expected instead of the previous EUR 39.32 million. Against this backdrop, the analysts maintain their 'Buy' rating. For the current fiscal year, 65,000 customers are expected for Smartbroker. In 2021 already 110,000 customers are estimated to use the online broker.
Conflict of interest
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