October 2nd, 2020 | 10:45 CEST
SIEMENS, NEL, BLACKROCK GOLD: Gold before the next buying wave!
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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
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.
SIEMENS - separation of the energy sector successful
The spin-off of the Siemens energy division must be regarded as successful. The former division became independent at the end of September. With just under 730 million shares and a current share price of EUR 22.74, the market capitalization is still EUR 16.6 billion. That would even be enough for the DAX, although the parent company is already listed there. The new MDAX aspirant has 90,000 employees and achieved a turnover of EUR 29 billion at last count.
Siemens shareholders were able to profit twice over because the long-standing conglomerate discount has now been reversed to some extent, for the better, as a result of the corporate splitting. On the one hand, they now hold an additional share in their securities account, which will pay regular dividends, and the spin-off effect of around EUR 11 billion was significantly less than the new share is now worth. This is how we work in the interests of our shareholders - thank you, Siemens!
NEL ASA - Share price cooling after the Nikola-beating
The scandal about the alleged fraud at Nikola also dragged the hydrogen company NEL ASA into the depths. Since the beginning of September, the price went down by 33%, which had previously reached an annual high of EUR 2.17. The reason was doubts that the network of hydrogen filling stations in North America, which was already believed to be "sold", would not make it into NEL's books so quickly after all.
Nevertheless, the figures which were presented at the end of August were not that bad. The turnover in the second quarter increased by 21% to NOK 149 million compared to the previous year - which, converted to Euro, only amounts to 13.6 million. With the level of awareness of the stock exchange, the order backlog at least increased by 75% to a good NOK 1 billion. However, the North American order must be considered a blockbuster given the still low turnover. The loss of this order is therefore likely to harm the NEL share for long term.
BLACKROCK GOLD - spin-off fantasy also driving the price of gold mines
The Board of Directors of Blackrock Gold Corp. is currently evaluating a proposal to transfer the company's Silver Cloud property located in northern Nevada, to a newly formed subsidiary (SpinCo). Following the financing of SpinCo, the shares will be distributed to Blackrock shareholders. Similar to Siemens, different issues are separated from each other, as the separate valuation is usually above the price for the group. Blackrock Gold will focus in the future on the Tonopah West property, also in the US state of Nevada. Five weeks ago, a 1.5 metre interval of approximately 3,600 grams silver equivalent per tonne was identified in drill hole TW 20-001. This is excellent mineralization that makes a mine look profitable.
Andrew Pollard, President and Chief Executive Officer, stated, "With gold hovering near all-time highs and our Tonopah West property dominating the show, we see this as the perfect backdrop to unlock value for investors by spinning out what was once our flagship property, Silver Cloud, into a separate, discovery-oriented public company. (...)."
The company's management is currently considering granting Blackrock shareholders one SpinCo share for every three common shares of Blackrock. Blackrock's share price has increased sevenfold in 2020 and is currently consolidating at a high level. If the spin-off goes smoothly without objections, a significant price increase is still possible with a tailwind from the precious metals front.
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