18. February 2021 | 10:11 CET
Osino Resources, Barrick Gold, Aurora Cannabis - Please watch closely!
Bitcoin reached a new all-time high of USD 51,500 yesterday. Bitcoin's great companion is gold. With an interim high at USD 1,870 at the beginning of the month, another correction wave has now been initiated. Yesterday, the price was at a significantly lower USD 1,788. So, it feels like the alternative hedges are now flowing into the crypto market - but for how much longer? Bitcoin is too small to absorb all the hedges against market dislocations. Consequently, gold would have to turn again when the sell-off is over. Therefore, position now!
time to read: 4 minutes by André Will-Laudien
"[...] We quickly learned that the tailings are high-grade, often as high as 20 grams of gold per tonne; because they are produced by artisanal miners, local miners who use outdated technology for gold production. [...]" Ryan Jackson, CEO, Newlox Gold Ventures Corp.
Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
Osino Resources - Valuable resource in Namibia
Those who think that gold will become a worthwhile investment again - and the charts speak for it, by the way - should take a closer look at Osino Resources. The Twin Hills project is the leading property and is located in north-central Namibia, where Osino maintains a tidy 7,000sq km tract of land. The large-scale, sedimentary and structurally controlled Twin Hills gold system was discovered by Osino in 2019 and is now being developed.
Late in the year, the Canadians reported high-grade drill results obtained from a total of 108 holes. A full 25,000 meters were examined in more detail. Dave Underwood, responsible for exploration, comments as follows: "Resource drilling at THC is on schedule for the targeted first resource release at the end of Q1 2021 and assay results continue to indicate excellent continuity with higher grades concentrated in the fold joints. Some recent drilling has intersected mineralization over 350 m down dip and remains open. The discovery along strike to the east at Clouds is also developing positively."
The second phase of work, which began in mid-January, is focused on Clouds and the Brownfields areas. Here is where it should be fascinating to see what resource estimates can be reported mid-year. We expect good news because, after all, none smaller than B2Gold is in the immediate vicinity and has been operating a thriving mine for years.
The analyst firm Echelon had recently announced a price target of CAD 2.30-2.45. If the resource estimates turn out above the expectation, this is too low, in our opinion. Gold fans grab!
Barrick Gold - The standard value is cheap again, but Buffett is out!
The large gold producers are left out of the techno rally. After the significant correction in March, there were sharp rises in the mining stocks, but a large part of the gains are gradually melting away. Barrick Gold Corp. shares have also been under pressure for months. Unfortunately, the gold bulls recently also had to abandon the USD 1,800 mark. The eyes are now directed in the direction of the chart support at USD 1,775. The precious metal price consolidated there yesterday. Barrick, however, had to give up a whole 3.4% to EUR 17.30. In the case of the share of the world's second-largest gold producer, there is another complicating circumstance: Berkshire Hathaway has said goodbye to its investment.
Berkshire's latest 13F report shows Warren Buffett's investment holding Company liquidated several positions in the fourth quarter. In addition to Pfizer and JPMorgan Chase, this includes the position of Barrick Gold, which Buffett's Company only established in the second quarter of 2020. Unfortunately, of course, there are no reasons in the report for the divestment decision. Still, one could speculate that Berkshire no longer expects high returns and therefore closed out the position. A cautious sign for precious metals fans, however, Warren Buffett had also turned to Tesla a few months ago, a parade tech title.
Within the mines, Barrick is now also deconsolidating Lagunas Norte. According to CEO Mark Bristow, the sale is part of Barrick's strategy of divesting non-core holdings. The group has already raised around USD 1.5 billion to focus on the highest quality assets. The share should stabilize between EUR 15 and EUR 17. The low in March was EUR 14.5. We advise you to accumulate slowly.
Aurora Cannabis - Trouble looms here
A prominent representative of the green gold "cannabis" is Aurora Cannabis Inc., which is just now showing its figures. The whole market has a long consolidation behind it, and just at the beginning of the new year, it went up again steeply. But can companies deliver on their promises? We look at Aurora's latest figures, which have now been presented as of December 31, 2020.
The Company reported revenue of CAD 67.7 million for the second quarter, which was roughly in line with the first fiscal quarter. Admittedly, compared to the same period last year, revenue grew 23%, but previous market estimates were over 30%. Meanwhile, medical cannabis sales increased 16% to CAD 38.9 million. The Company's bottom line was an EBITDA loss of CAD 16.8 million, an improvement of a hefty 76% over the same period last year, but still in the red. It will probably be rather challenging to break even in the current year.
New CEO Miguel Martin took the helm at Aurora in September 2020 and has since introduced some major cost-cutting measures, with unused growing facilities closed or put up for sale. The large Aurora Sky plant has also been closed; the cost burden is too high. The European assets in Portugal, Spain and Italy are to be consolidated as quickly as possible. Contrary to many market participants' hopes and unlike Canopy Growth a few days ago, Aurora Cannabis has not provided guidance on when it expects to break even. Previous estimates were conceded in the first fiscal quarter, as one sees significant uncertainties due to the pandemic. You hear that a lot!