20. April 2021 | 11:53 CET
Silver Viper Minerals, Coinbase, SAP - There are always winners!
It is once again time to look at the precious metals, as the week started yesterday with slightly weaker stock prices and a rather battered crypto world. Its main protagonist, the Bitcoin, had made a jump to almost USD 65,000 in the last 5 days - but the euphoria was now abruptly curbed when it slid down by over USD 12,000. Not a good day for those who entered recently, but given the tenfold increase since the beginning of 2020, probably bearable for most. Where does this volatility come from? Market technicians speak of an incipient nervousness due to the sharp rise in stock and crypto prices in the last 3 years. Whatever the outcome, precious metals have profited in any case. Gold & silver plus 1-3% at the peak. We look at selected opportunity stocks.
time to read: 4 minutes by André Will-Laudien
"[...] In our experience, the local communities are supportive and friendly. [...]" Steve Cope, President, CEO and Director, Silver Viper
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.
Silver Viper Minerals - First resource estimates from Mexico
Times of uncertainty play into the precious metals' cards because no investor wants high volatility in his portfolio. Stabilizers here are usually the gold and silver stocks because they are, by definition, not dependent on the current economic cycle. Even on the contrary, in cases of upheavals or political shock waves, they provide necessary confidence. After all, whatever happens to the major monetary systems, gold and silver (including platinum) have historically shown themselves to be value-preserving assets in most shaky market periods.
Silver Viper Minerals' gold-silver project is located in Mexico, specifically in northern Sonora, the leading gold-producing state. The "La Virginia" property operated there had previously belonged to Pan American Silver. Silver Viper's management had a suitable offer ready near the lowest silver spot prices and bought the asset equipped with good historical drilling.
The Company has now provided good first quarter exploration data in early April. It reports that it has invested quite a bit in working conditions at the site to meet the highest health requirements during the pandemic. Drilling continues to progress at La Virginia along known mineralized trends, with the El Rubi zone also returning good to very good results. Preparations are now underway for the first resource estimate.
Several mineralized intercepts have been discovered in recent months, not least the extremely high-grade zone from hole LV21-289 with a best intercept of 19.30 meters averaging 363 g/t silver and 21.2 g/t gold. Before the high grade hit, the same hole also intersected a broad zone of mineralization, averaging 18 g/t silver and 0.69 g/t gold over a 130 m hole length. NI 43-101 indications are expected to be released in the coming months.
With the current strengthening of the silver price around USD 26, Silver Viper is excellently positioned in the market segment. The share currently costs CAD 0.56, which results in a moderate capitalization of CAD 45 million. With the resource estimate, life will come into the share price.
Coinbase - 5 billion cash for existing shareholders
That was probably the "IPO 2021" - and actually not one after all. We are talking about Coinbase, the largest crypto trading platform in the world. Strictly speaking, it was only a listing because there were no new shares, which could have been acquired via a subscription. For Coinbase, it was only a listing in favor of already invested existing shareholders. Anyone who wants to put the hope stock in their portfolio must now pay the current price of USD 332. This brings Coinbase's valuation from a standing start to USD 65 billion; they even set the mark above USD 100 billion in the course.
It is not necessarily a good sign for future developments when the CEO and co-founder of a company exits his shares in a big way. However, this is precisely what has happened now. CEO Brian Armstrong sold USD 292 million worth of Coinbase shares in the first few days. Does he himself not believe his story, or does he have a more significant tax debt to settle? Whatever the reasoning, it does not matter. NASDAQ provides the capital because liquidity has never been higher.
As reported by the Reuters news agency, the trade is said to have taken place on the first day of trading. Thus, a total of 749,499 Coinbase shares were dumped. The price per share ranged from USD 381 to USD 410, figures from the SEC regulator show. Armstrong sold and other investors from the Friends and Family environment used the positive mood to close out. A whopping USD 5 billion could be cashed out in this way, the high was marked at USD 428, but since then, it has been going down. Caution at the platform edge!
SAP - Spin-off of the financial software division
SAP recently founded a company out of an investment company to support banks and insurance companies in digitalization. The strategic decision, which the stock market had been speculating about for weeks, has thus been made. SAP wants to finally spin off its financial services business from the group.
In order to expand SAP's banking and insurance portfolio and develop new industry-specific solutions, a joint venture with private equity firm Dediq will be formed in the coming weeks. As other companies have already shown, the splitting of issues within a group is often associated with significantly higher valuations of the individual components. The so-called conglomerate discount is reduced. Siemens has impressively demonstrated this with EPCOS, Infineon, Osram as well as Siemens Healthineers. The goal of the spun-off SAP company is to quickly establish a new unit as a permanent fixture in the IT market.
According to "Handelsblatt," Dediq will invest more than EUR 500 million in the new Company, giving it an 80% stake. In return, SAP will contribute its products and organizational units to the Company and retain the remaining 20%. The transaction is expected to close in the third quarter, pending approval from the antitrust authorities. With these steps, SAP is demonstrating a far-sighted portfolio orientation and is making itself leaner. On the timeline forward, this will lead to an increase in assets. At prices around EUR 116, SAP is still close to the depressed level after the profit warning in October 2020. Opportunities should increase if the share can climb the EUR 120 mark.