November 26th, 2021 | 14:06 CET
MAS Gold, K+S, Klöckner & Co. - For fans of real assets!
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"[...] We knew the world was rapidly electrifying and urbanising and needing significant amounts of copper to do so. [...]" Nick Mather, CEO, SolGold PLC
The native Rhineland-Palatinate has been a passionate market participant for more than 25 years. After studying business administration in Mannheim, he worked as a journalist, in equity sales and many years in equity research.
MAS Gold - Analysts see price doubling potential!
Recently, the experts of Couloir Capital Ltd. came to a very positive assessment in their initial analysis of the Company. The analysts rate the share as a "buy" with a price target of CAD 0.22. Thus, the share certificates have a doubling potential. MAS Gold focuses on gold exploration in Saskatchewan. The focus is on the La Ronge South Gold joint venture and the exploration of the Greywacke, Preview Lake and North Lake properties. The Company also holds interests in Henry Lake and Little Deer Lake.
The La Ronge Gold Belt has geology similar to rich gold mining areas in West Africa. MAS Gold is pursuing a hub-and-spoke model. That means that all smaller projects are to be connected to a central processing plant, which significantly reduces the capital expenditure measured against the individual project. Parallel to exploring existing deposits, the Canadians are also planning acquisitions of properties in the region.
The Preview Lake property covers an area of 10,041 hectares. The North Lake gold deposit is located about 5 km north of Point Prospect and about 24 km south of Golden Band's abandoned Roy Lloyd mine. The Company's goal is to report a resource estimate of 1 million ounces of gold soon. Currently, MAS Gold is valued at only CAD 15 million. Project progress and rising precious metal prices should give the shares a tailwind in the medium term.
K+S - Strong figures and positive outlook, write-downs still on BaFin's mind
Operationally, things have been going well for the fertilizer producer in recent months. K+S is benefiting from rising prices for agricultural raw materials. In addition, the sale of the American salt business in May 2021 has resulted in a significant reduction in debt and a strengthening of the balance sheet. On balance, K+S earned just under EUR 1.3 billion from continuing operations in the third quarter, following a loss of almost EUR 1.8 billion.
The Kassel-based Company is forecasting an operating profit of about EUR 630 million for the current fiscal year. A previously expected contribution of EUR 200 million from the establishment of the Reks joint venture by K+S and Remondis subsidiary Remex is now no longer included in the guidance, as the review of the transaction by antitrust regulators is dragging on too long. As the Group also expects good prospects for the agricultural market in 2022, CEO Lohr held out the prospect of operating earnings of around EUR 1 billion for the fertilizer producer in the next fiscal year.
However, BaFin has again been a source of irritation. The latter is still examining a billion-euro write-down in 2020, and the case is still being reviewed by the German Financial Reporting Enforcement Panel (FREP). There are still suspicions that K+S had overstated assets. The write-down had become necessary because the Kassel-based Company had previously been too optimistic about potash prices. Investors should look ahead and see price setbacks as an opportunity.
Klöckner & Co. - High dividend planned: 9 to 11%
According to the industry association Wirtschaftsvereinigung Stahl, crude steel production in Germany increased by 7% YOY to around 3.7 million tons in October 2021. From January to October 2021, crude steel production even increased by about 15%. The recovery is thus continuing after steel production in Germany in the Corona year 2020 fell to its lowest volume since 2009.
High prices helped the Group achieve a jump in profits in the third quarter. Adjusted EBITDA rose to EUR 277 million from EUR 40 million in the weak prior-year quarter. At the end of September, the Company raised its forecast for the current fiscal year. Shareholders are now to benefit significantly from the Company's success. The Company announced a dividend of between EUR 0.90 and EUR 1.10, thus exceeding market expectations by around half. That means a dividend yield of around 9% to 11%! In the last two years, shareholders had to forego a dividend payment altogether. For 2017 and 2018, EUR 0.30 per share was paid out in each case.
Inflation can be controlled with the shares presented. In the case of Klöckner & Co., a dividend yield of up to almost 11% beckons! K+S benefits from the price boom for agricultural commodities. If you want to bet on a rising gold price, MAS Gold is attractive. Exploration companies usually outperform in phases of rising precious metal prices.
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