Oversold? Kostolany Buy Signals Emerge for Rheinmetall, Lahontan Gold and Coinbase

Rheinmetall: Bad News, Rising Prices

Rheinmetall's share price has nearly halved since its high of more than EUR 2,000. But the decline has stopped. In theory, at least, a defence stock should actually give ground on days when tensions ease. The ceasefire in Iran was compounded by a second setback: China placed the company on an export control list for so-called dual-use goods—that is, goods with both civilian and military applications. This is Beijing's response to the EU's latest package of sanctions. The sticking point is rare earths. China controls about two-thirds of global production and nearly 90% of processing in this sector. However, the measure does not constitute an immediate halt to shipments; rather, it creates legal uncertainty. According to the company's own statements, it secured its supply of these raw materials early on by building up inventories.

The share price has risen by nearly 10% over the past week—despite easing tensions in the Middle East and news from Beijing. A classic Kostolany signal. This may also be due to the valuation, based on the price-to-earnings (P/E) ratio for the coming year, having returned to more realistic levels. For 2027, the analyst consensus expects earnings of EUR 54.84 per share. At the current price of EUR 1,093, this translates to a P/E ratio of just under 20—not a bargain, but given that the German government's sharply rising defence spending almost automatically ensures growth for the coming years, it provides a healthy foundation for prices to rise again.

Additional support comes from a recent analysis by the AI tool Warren Wise, developed by the Wiesbaden-based company CPT GmbH, which analyzed 40 of Germany's largest companies from the perspective of a long-term value investor. With a rating of "Strong", Rheinmetall ranks among the 14 highest-rated stocks in terms of business model, balance sheet quality, transparency, and numerous other criteria. What is more, the Düsseldorf-based company is one of seven corporations that meet all quality criteria and whose free cash flow fully covers reported profits. The freely distributable earnings (also known in technical jargon as "owner earnings") actually exceed net income. The result is therefore calculated on a rather conservative basis.

Lahontan Gold: Lawsuit Resolved, Revaluation Ahead

Lahontan Gold has also declined along with precious metal prices since its highs above CAD 0.50, falling by about 30% since March. Since then, a solid floor has been forming just above CAD 0.30 (~EUR 0.20), regardless of the gold price. The negative news came on July 21. The commodities investor Vox Royalty filed a lawsuit against two subsidiaries. The dispute centers on a supply contract dating back to 2018. Management considers the lawsuit unfounded and does not expect any significant consequences for the business. The share price remained stable—so here, too, there is no new selling pressure, which, according to Kostolany's principle, is a good sign. The fact that Vox Royalty wants to cash in right now is, strictly speaking, also a positive sign, as the start of production at the flagship Santa Fe project in Nevada is drawing ever closer. The company is therefore expected to earn enough money to settle old bills, whether they are justified or not. By the end of 2027, the experienced management team led by CEO Kimberly Ann and geological mastermind Brian Maher aims to hold the first self-cast bars in their hands. The company's flagship Santa Fe project is a former producing mine with existing infrastructure. Between 1988 and 1995, 359,202 ounces of gold and 702,067 ounces of silver were already mined there. Such mine restarts, known in the industry as brownfield projects, are typically less costly and faster to develop than greenfield projects. According to previous technical studies, the project hosts an estimated resource of 1.95 million gold-equivalent ounces.

Most recently, the drilling results were encouraging. A historic tailings pile yielded 9.9 m grading 2.4 g/t gold and 50.7 g/t silver, significantly more than expected. By way of comparison: in Nevada, thanks to the cost-effective heap leaching process, which involves dousing the rock with a dilute cyanide solution, mining is considered highly profitable starting at a gold grade of just 0.21 g/t. The material in Santa Fe is already at surface and can therefore be processed particularly cost-effectively. In addition, high-grade deposits, such as those in the West Santa Fe satellite project located just 13 km away, can be developed using the main mine's infrastructure with minimal additional investment. CEO Kimberly Ann explains this in more detail in an interview with IIF host Lyndsay Malchuk.

https://youtu.be/QGRV7IfTWec

The Canadian company has so far focused its activities almost exclusively on Nevada in the neighbouring United States—which it describes as the safest and most mining-friendly region on Earth. Lahontan has several other projects in the pipeline there that are not even remotely factored into its current market capitalization of approximately USD 100 million. An older preliminary economic assessment (PEA) estimated the project value of the main mine alone at USD 200 million—based on an assumed gold price of USD 2,705, which is significantly below the precious metal's current price of USD 4,045 per ounce. In a few weeks, an updated resource estimate and a revised PEA will be published, which are likely to yield very different results. The 200,000 ounces lying freely on the old heap leach pads alone currently have a market value of over USD 800 million.

Lahontan's leadership duo, Ann and Maher, proved some time ago that they can lead projects to success—as seen with Prodigy Gold. There, resources were estimated at 1.6 million ounces in 2010. By the time Argonaut Gold acquired the project 26 months later, the figure had more than quadrupled. This was the result of an aggressive drilling program, Maher's geological intuition, and Ann's financing and negotiation skills. Once regulatory approval for Santa Fe is secured and production begins next year, the gold lying in plain sight will initially provide the necessary cash flow to finance further activities. The stock's revaluation therefore depends very little on the daily gold price. It is project-specific—and thus represents the longer-term leverage.

Coinbase: Base Formation Taking Shape Around USD 150

Shares of the crypto trading platform Coinbase have fallen from over USD 400 to around USD 163 in just over a year, dragged down by Bitcoin. Here, too, the Kostolany pattern is clearly evident. In February, the share price slipped briefly below USD 150 twice. Since then, however, this level has withstood every bearish attack—even though Bitcoin continued to decline, particularly in May and June. The price, therefore, no longer reacted to the bad news. Long-term investors are building positions. Laetitia-Zarah Gerbes of the Frankfurt-based fund management company Acatis, for example, explains in the latest investment report for July: "With an eye toward the next Bitcoin halving in 2028, we have already established an initial, smaller position in Coinbase." A halving cuts the reward for newly mined Bitcoins in half—an event that many investors view as a price driver. Those who are already preparing for this are looking far beyond the current ups and downs.

Risks remain. US authorities transferred seized Bitcoin to the Coinbase Prime platform, which could put further short-term pressure on the cryptocurrency's price. At the same time, however, it shows that the authorities are relying on Coinbase for custody. The US Securities and Exchange Commission (SEC) has declared the crypto market one of its top regulatory priorities for 2026. It intends, among other things, to revise the guidelines for custody, trading, and registration of digital assets—a shift away from the litigious approach of the previous administration under Gary Gensler, which had also subjected Coinbase to numerous legal proceedings. Clearer regulation is generally seen as benefiting established trading platforms. However, with the proposals still subject to the usual consultation process, analysts remain divided on their long-term impact, and price targets differ dramatically.

Now It Is All About Numbers, Outlooks, and Analyst Reports

Rheinmetall, Lahontan Gold, and Coinbase fit perfectly into Kostolany's investment profile. All three have recently shaken off news that could have further weighed on their share prices—a sign that selling pressure has subsided. Rheinmetall will report its second-quarter results on August 6; the consensus expects earnings of about EUR 6.06 per share. Analysts have recently become somewhat more cautious amid falling share prices. However, the price targets published since early July average around EUR 1,700, with the range extending from EUR 1,300 (Jefferies) to EUR 2,000 (Barclays). The resulting upside potential ranges between 20% and 80%.

Coinbase is expected to release its quarterly results as early as this Thursday, July 30, after the US market closes. Then we will see whether the bulls or the bears are right. Expectations are low; current estimates project a loss of USD 0.41 per share. The median price target among analysts is USD 216, which is about one-third above the current price; however, the range extends from USD 99 to USD 330—from a steep loss to a doubling of the share price. In this regard, CEO Brian Armstrong's outlook is likely to be particularly decisive.

Naturally, there are no consensus estimates for Lahontan Gold yet, even though the start of production is already in sight. The company's fortunes therefore depend neither on a quarterly report nor on the gold price on any single day. The roadmap is set, and the countdown to revaluation is underway, with the updated resource estimate and PEA expected in a few weeks. If major investment firms then take notice of the company, a small, still largely overlooked explorer could become the next big success story in the gold mining sector.