Steinhoff International, Blackrock Gold, Halo Labs - Watch out: Something is up with these penny stocks!

STEINHOFF INTERNATIONAL - Goldman Sachs gets involved, a settlement in sight?

Steinhoff is a global holding company with interests in various retail companies that distribute, source and manufacture household and general merchandise in multiple markets. The Group focuses on price-conscious consumers. In Germany, the Company was known, among other things, from the Poco furniture chain, but this was sold to a competitor.

Steinhoff has been embroiled in a massive accounting scandal since 2017, during which fictitious bookings of more than EUR 6 billion had to be admitted. Last summer, the South African Company, which in 2017 still had a valuation of several billion euros and was listed on the MDAX, offered plaintiffs a settlement. That settlement contains a variety of components and includes a total payment of USD 1 billion in cash and shares in fashion retailer Pepkor, in which Steinhoff holds a majority stake. According to Company statements, the proposal included the majority of the 90 ongoing lawsuits with a volume of more than USD 8 billion.

So far, however, no agreement has been reached. In other respects, too, the information available about the Company is rather scanty. What is clear is that losses have once again increased significantly in the wake of the Corona Crisis. On February 26, the Group will publish a trading update for the first quarter and the figures for the past fiscal year. The share price increased in recent weeks from around EUR 0.05 to EUR 0.07, which means that Steinhoff is currently valued at EUR 310 million. A good week ago, information was published that further strengthened the dynamic share price increase. Goldman Sachs reported that it had secured a stake in the Company of up to 2.8% in several transactions. We see this as an indication that an agreement in the legal dispute and a necessary balance sheet restructuring of the Group could occur soon. This constellation could then easily be the basis for a real share price explosion.

BLACKROCK GOLD CORP - latest drill results confirm huge potential

The Canadian exploration Company focuses on two gold and silver projects in the US state of Nevada. Due to famous silver discoveries in the late 19th and early 20th centuries, Nevada is also known as the "Silver State" and is now one of the world's top mining jurisdictions.

These well-known and significant silver discoveries included the Comstock Lode and Tonopah Silver District in western Nevada, known as the Walker Lane Trend. The Company's larger "Tonopah West" project covers a large area west of the Tonopah Silver District. Blackrock Gold's goal is to prove the District's western extension and restore the Tonopah Silver District to a significant producing area. To achieve this, 40,000 meters of drilling is expected to be completed this year. Mid-month, the Company reported results from test drilling of "Victor Target," a zone within the Tonopah West Project. The results show high-grade deposits and thus prove the geological model, according to the Company.

The aim is to produce a resource estimate in the fourth quarter of 2021 based on the aforementioned drilling program. But the advancement of the Silver Cloud project in the northern part of the state is also exciting. To date, 14 drill holes covering 3,500m have been drilled. The project is at a very early stage but has high upside potential due to its sheer size of 42 sq km.

Blackrock Gold owns two world-class projects. The published data of the "Victor Target" suggests a great success of the announced drilling program of 40,000m this year. If so, the stock should quickly end its consolidation. With a market value of around CAD 100 million, the valuation is moderate.

HALO LABS INC - an excellent start to the year

Halo Labs is a Canadian-based cannabis extraction Company. The Company cultivates, extracts, and processes cannabis flowers, oils, and concentrates. It sells several categories of products with its own brands and in the form of white labels.

The Company operates in the US in California, Oregon and Nevada. Through a subsidiary, Halo Labs is involved in the cultivation of cannabis for medicinal purposes on 200 hectares in Lesotho, Africa.

Like many cannabis companies, Halo Labs' stock price has taken a hit in recent months. Last week, the Company reported a solid start to the year and high demand. To ensure sufficient working capital for production, it secured an expansion of its financing facility of up to CAD 10 million.