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April 20th, 2023 | 08:00 CEST

Orestone Mining, Nikola, Volkswagen - Where solid work still counts for investors

  • Mining
  • Gold
  • Silver
  • Electromobility
Photo credits: Nikola Motor

The global demand for electric transport vehicles is increasing, and with it, the demand for precious metals such as gold and silver. Whether in cockpit electronics or as an application in luxury BEVs, companies like Orestone Mining Corporation are well-positioned to serve the global markets. In contrast, all that glitters is not gold at Nikola Motors. The share price continues to plummet as the management team seems good at only one thing: Burning money. One of the accused confessed this week on the subject of the combustion engine in the Volkswagen Group's Dieselgate scandal. Accordingly, the target price of VW shares has now been adjusted.

time to read: 4 minutes | Author: Juliane Zielonka
ISIN: ORESTONE MINING CORP. | CA6861543032 , NIKOLA CORP. | US6541101050 , VOLKSWAGEN AG VZO O.N. | DE0007664039

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    Orestone Mining Corp. - Precious metals for the electric vehicle industry

    Newly built cars and trucks contain precious metals such as gold and silver. Advanced electronics are a valuable component of modern vehicles. The technology monitors engine performance, controls onboard navigation, and automates numerous switches throughout the vehicle. It uses circuit boards equipped with silver and gold as components.

    Orestone Mining Corp. is a candidate for a permanent supply of these precious metals. The Canadian company is focused on advancing its 100%-owned, 105 sq km 'Captain' project in northern British Columbia.

    The site is located 41 km north of Fort St James and 30 km south of the Mount Milligan copper-gold mine. The area is characterized by excellent road infrastructure, making it easy to travel even in the Canadian winter.

    The exploration work that started in 2019 has been focused on locating the source of a high-grade calc potassium feldspar kspar-sericite monzonite porphyry inclusion in a post-mineral dyke in drill hole C13-03. This setting suggests the presence of a large gold-copper porphyry system, with the lower intersection in hole C21-02 indicating the potential for higher grades. An ambitious programme is in the pipeline for the current year, focusing on rock structure analysis.

    Two drill holes with a depth of 1,000 m are to be drilled. The work is particularly focused on the western area, which extends along a northwest-trending fault. Promising results have been obtained here in previous drilling: Gold-copper mineralization has been located. Orestone Mining is confident that its drilling and discoveries will continue to be positive for its shareholders.

    Nikola share in free fall, and the board is downsizing

    Although global demand for battery-powered vehicles is rising, the exact opposite is happening at electric van manufacturer Nikola. In the past few years, Nikola's share price has experienced a steep decline. For investors, this has so far been a loss in the billions. In April, the share price reached a new low of EUR 0.75, corresponding to a decline of more than 90% compared to the all-time high.

    The developer and manufacturer of zero-emission electric battery-powered vehicles (BEV) should have its finger on the pulse of the times with its business. But the Company has been suffering from a chronic lack of cash for some time now. The latest financial report reveals nothing good: Only USD 215.8 million in liquid funds and short-term investments are in the coffers. This a sobering comparison to the previous year, when a whopping USD 749.8 million were still available.

    Now, heads are rolling on the board of directors. And as always, it sounds formally sober: "Nikola is focused on delivering results in our core business areas of zero-emission trucking and energy infrastructure solutions," said Steve Girsky, Chairman of Nikola's Board of Directors. "**As the Company evolves, the size and composition of the Board of Directors will also change. We are grateful for Gerrit, Lynn and Mark's many contributions to Nikola over the years and wish them all the best."

    Volkswagen - White smoke in Dieselgate?

    The Volkswagen emissions scandal is slowly gaining momentum in the fraud trial of former Audi boss Rupert Stadler. On Wednesday, his lawyers and two other defendants negotiated behind closed doors with the judges and the prosecution about a possible ending of the trial through a deal. Stadler and Hatz have so far denied the charges, while a third defendant has already confessed. In the Dieselgate, or emissions scandal, several car companies - including Volkswagen - manipulated diesel levels in newly manufactured cars in order to circumvent the EU's new laws to protect the environment.

    Various parties to the lawsuit have confirmed that the conversation in the Munich Regional Court has been positive. However, details will not be made public until the next public court hearing on April 25. In the context of the events surrounding the court hearing and the results thereof, the Canadian bank RBC lowered the target price of the Volkswagen preferred share from EUR 221 to EUR 181.

    In the 2022 financial year, Volkswagen once again proved it is an economically strong company. Despite the difficult economic situation and the tense geopolitical environment, the operating profit before special items increased to EUR 2.6 billion. That corresponds to an operating return of 3.6% compared to the 2021 financial year, in which the operating profit was EUR 2.2 billion and the operating return was 3.2%. By 2030, Volkswagen expects an e-car share of around 80% in Europe. This a great opportunity for precious metal miners who focus on gold and silver.

    For investors, the commodity market is an excellent opportunity to reshuffle their portfolio now with precious metals such as gold and silver. Global demand is increasing, and with an eye on Canada as a democratic and ESG-compliant country, companies like Orestone Mining Corp. are of great interest. Investors who back electromobility should take a close look at the change in the Board of Directors at Nikola and weigh up whether personnel streamlining alone will be good for the share in the long run. Volkswagen, on the other hand, is still in the thick of the Dieselgate scandal. Only on April 25 will there be further details in the trial with the accused managers.

    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

    Juliane Zielonka

    Born in Bielefeld, she studied German, English and psychology. The emergence of the Internet in the early '90s led her from university to training in graphic design and marketing communications. After years of agency work in corporate branding, she switched to publishing and learned her editorial craft at Hubert Burda Media.

    About the author

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