Connect with us

Articles

Best Copper Stocks To Watch For January 2022

Hot copper stocks to watch in January 2022
The post Best Copper Stocks To Watch For January 2022 appeared first on Gold Stocks to Buy, Picks, News and…

Published

on

This article was originally published by GoldStocks

There’s a good chance that if you’re excited by the electric vehicle industry’s growth, copper stocks will be on your 2022 watch list. In the stock market today, EV stocks like Tesla (NASDAQ: TSLA) are bouncing. With that bounce has come some added optimism to a potential rebirth of market momentum. EV stocks were some of the hottest in 2021. The IPO or Rivian (NASDAQ: RIVN) helped give a nice boost.


Gold Stocks 30-Second Article Overview

  • Copper is one of the key metals used in EV manufacturing and electrical components
  • The growth of the EV market could become a boon to copper demand
  • This year saw a surge of new interest for electric vehicles
  • Should this trend persist in 2022, copper demand could move in kind
  • Today we look at copper stocks to watch for the start of 2022

While fast-money bets were placed on the manufacturers and ancillary service providers like charging stations, some investors have looked elsewhere. That initial speculation has come to the forefront heading into 2022. I’m talking about copper. According to Jon Lynch of CME Group, electric vehicles use more than double the copper of an internal combustion engine automobile. The metal is also used heavily in EV infrastructure. With sales of electric and hybrid vehicles in the U.S., Europe, and China increasing over the last ten years, expectations are that this trend will persist.

“The acceleration towards lowering carbon output through alternative energy sources has become a top priority around the world, particularly in the transportation sector. The Biden administration is set to introduce a green infrastructure and clean energy plan which was initially estimated at $3 trillion. First revealed last year, the plan is likely to include upgrades to municipal transit networks, expansion of broadband/wireless broadband to all Americans, as well as investment in electric vehicle infrastructure,” says Lynch.

Not A Time To Overlook Copper

Raw materials are the fabric of the EV movement. It should seem obvious, but without certain metals and minerals, the batteries, motors, and even electronics for automatic mirrors wouldn’t be able to operate.

What’s more, metals like copper are in high demand not only for EVs but also for hybrid vehicles. Then you’ve got to consider that ancillary platforms (I.E., charging stations) will also increase copper demand. Wood Mackenzie estimates by 2030, there will be over 20 million EV charging points globally, consuming 250% more copper than in 2019.

Copper Stocks To Watch For January 2022

Southern Copper Corporation (NYSE: SCCO)

mining stocks to watch Southern Copper Corporation (SCCO stock)

As one of the largest copper producers in the world, Southern Copper could be one of the top copper stocks to watch. Aside from copper, the company also produces molybdenum, zinc, lead, coal, and silver via its facilities in Preu and Mexico.

Southern has reported strong growth this year, and all you need to do is look at the most recent third-quarter results to see why. The company realized a net income of $867.6 million, up 71.5% compared to last year’s quarter. Furthermore, net margins were 32.4%, up from Q3 20202’s 23.8%. Thanks to higher sales and cost controls implemented, Souther Copper said on a year-over-year basis, net income soared 161.6% higher than 2020.

Read: Top Mining Stocks To Watch Today As Growth Stocks Take a Breather

What do analysts think about this copper stock? Both Wolfe Research and Morgan Stanley have high hopes for the company. This quarter, Wolfe started the copper company at Peer Perform with a $62 price target. Meanwhile, Morgan Stanley boosted its Underweight rating to Equalweight and kept its $55 price target.

Freeport McMoRan (NYSE:FCX)

mining stocks to watch Freeport-McMoRan Copper & Gold (FCX)

Shares of Freeport have had a banner quarter. After dropping to lows of $30.02 in Q3, FCX stock has managed to reach new H2 highs of $42.77 this week. While the company is a more diversified miner, it does produce significant amounts of copper at more than 1 billion pounds annually in the US. In its last quarterly report, the company also said that the market outlook for the metal is “extraordinarily positive.”

Aside from its mining performance, investors may want to consider Freeport’s recent “up to $3 billion” share repurchase program. It also declared quarterly dividends for 2022 of $0.15 per share.

“With the recent achievement of our net debt target, strong execution of operating plans, and favorable market conditions for our products, we are pleased to commence implementation of our performance-based payout framework.”

Chairman and Chief Executive Officer Richard Adkerson in comments from November.

What do analysts think about Freeport? This month Morgan Stanley and Stifel both weighed in on Freeport. Morgan Stanely’s analysts maintain Equal-Weight; Stifel started the mining company with a Buy. The firms also maintain price targets between $34 and $48.

Vale S.A. (NYSE: VALE)

gold stocks to watch Vale SA (VALE)

Shares of Vale continue reclaimed losses from earlier in the year. Ever since the summer, VALE stock has gotten demolished. The miner’s shares dropped from over $20 to nearly $11 during the year’s second half. But recent interest in electric vehicles and raw material producers has helped bring back some life.

Vale has its copper mining operations in Brazil and Canada. However, the last quarter was disrupted by labor issues at its Sudbury location. That ultimately impacted total copper production for the quarter. The company also halted copper concentration at its Salobo site due to a fire in October.

Read: Top Mining Stocks On Robinhood To Buy For Under $1

Regardless, Vale expects to produce 75,000 – 80,000 t of copper during the 4th quarter. That would bring yearly production into a range of 295k-300k tons of the year. What may be more important to look at is expectations for copper production over 2023-2026. The company anticipates 390-420 kt and is expected to trend above 450 kt after that.

Copper Stocks To Watch In 2022

Thanks to the rise in popularity of electric vehicles, certain raw materials have obtained a much brighter spotlight heading into the near year. With that, mining stocks will likely play an integral role. As 2021 comes to the finish line, we look ahead at potential emerging trends in the New Year, and copper could easily be one of these.

The post Best Copper Stocks To Watch For January 2022 appeared first on Gold Stocks to Buy, Picks, News and Information | GoldStocks.com.

nyse
nasdaq
gold
copper
zinc
molybdenum

Author: Adam Lawrence

Precious Metals

7 Bear Market Stocks to Buy If You See Trouble Ahead

With the markets in the early stage of 2022, the stage seems set for some degree of uncertainty. The good news is that the pandemic might soon become endemic….

With the markets in the early stage of 2022, the stage seems set for some degree of uncertainty. The good news is that the pandemic might soon become endemic. This is likely to help in accelerating global economic recovery. The worrying news is that there is a case for at least four interest rate hikes in 2022. In these market conditions, it’s a good idea to hold some bear market stocks.

I would define bear market stocks as low-beta stocks that are relatively immune to economic or liquidity tightening. These stocks are good for capital preservation. When market sentiments are bullish, it makes sense to go overweight on high-beta stocks. However, in uncertain or bear market conditions, I would be overweight on low-beta stocks.

I must also mention that even with four interest rate hikes, real interest rates are likely to remain negative. Investors will therefore continue to pursue exposure to risky asset classes. While I am talking about bear market stocks, I believe that a big correction is unlikely.

However, profit taking in expensive stocks is a good idea and these profits can be parked in bear market stocks.

So, let’s looks at seven stocks that that also have a healthy dividend yield.

  • Walmart (NYSE:WMT)
  • AstraZeneca (NASDAQ:AZN)
  • Newmont Mining (NYSE:NEM)
  • JPMorgan Chase (NYSE:JPM)
  • Starbucks (NASDAQ:SBUX)
  • Equinor (NYSE:EQNR)
  • Microsoft (NASDAQ:MSFT)

Bear Market Stocks to Buy: Walmart (WMT)

Source: Jonathan Weiss / Shutterstock.com

WMT stock is among the top picks in the list of bear market stocks. The first reason is a low-beta, which will ensure capital preservation even in a market correction. Further, WMT stock has a dividend yield of 1.53% and considering the company’s balance sheet, dividends are secure.

It’s also important to note that the U.S. is a consumption driven economy. A key part of consumption expenditure is retail spending. Even in a bear market, the company’s financial performance is likely to remain robust.

From a business perspective, Walmart has built omni-channel sales capabilities. This is one key factor that will ensure healthy comparable store sales growth. For Q3 2022, the company reported e-commerce sales growth of 8%. On a two-year stack basis, e-commerce sales growth was 87%.

International presence is another driver of long-term growth. While divestitures impacted international sales growth in Q3 2022, Walmart reported strong e-commerce growth in India, China and Mexico.

Walmart reported free cash flow of $7.7 billion for the first nine months of the current financial year. This gives the company ample flexibility for dividends and share repurchase. At the same time, the company can continue investing in high-growth international markets.

AstraZeneca (AZN)

Exterior of the AstraZeneca's manufacturing facility at SnackvikenSource: Roland Magnusson / Shutterstock.com

The pharmaceutical sector is another defensive sector to consider for bear market stocks. AZN stock is a quality pick with a five-year (monthly) beta of 0.19. Additionally, the stock has a dividend yield of 2.35%.

One reason to like AstraZeneca is the company’s healthy growth trajectory. For Q3 2021, revenue growth on a year-over-year basis was 28% to $25.4 billion. Excluding the impact of the vaccine, revenue growth was 17%. I believe that strong top-line growth is likely to sustain in the next few years.

One reason is the impact of the Covid-19 vaccine. With the Omicron variant, revenue is likely to be robust even for 2022. Additionally, there is a case for annual booster doses of the vaccine in the coming years.

Another reason to be bullish is the fact that the company has a deep pipeline of candidates. The current pipeline includes 175 projects in various stages. As more drugs are commercialized for different conditions, revenue growth will sustain. It’s also worth noting that the company is expanding its bio-pharmaceutical product presence in emerging markets with significant growth potential.

For the first nine months of 2021, AstraZeneca reported operating cash flow of $4.5 billion. This implies an annualized cash flow potential of $6.0 billion. Considering the product pipeline and global reach, it’s likely that cash flows will continue to swell in the coming years.

Overall, AZN stock is among the quality names to hold in a bear market. The stock is also worth considering for the core portfolio.

Bear Market Stocks to Buy: Newmont Mining (NEM)

Newmont (NEM) logo on a mobile phone screenSource: Piotr Swat/Shutterstock

NEM stock has been sideways for the last 12-months. The 3.39% dividend yield stock with a beta of 0.28 is worth considering among bear market stocks.

Investors will be wary of rate hikes in 2022 and its impact on gold price. However, there are two important points to note.

First and foremost, even with three or four rate hikes, real interest rates are likely to remain negative. Gold is therefore likely to remain firm at current levels.

Furthermore, in a possible bear market, investors will move funds away from risky asset classes to relatively low-risk asset classes. Gold is likely to witness fund inflow if there is a meaningful correction in equities.

These factors make NEM stock worth considering. Specific to the business, the company has a robust asset base (94 million oz. of gold reserves) and expects steady production through 2040. This provides clear cash flow visibility.

Important, Newmont expects the all-in-sustaining-cost to decline to $800 to $900 an ounce in the coming years. Even if gold trades in the range of $1,800 to $2,000 an ounce, EBITDA margin will remain robust.

For the first nine months of 2021, Newmont reported free cash flow of $1.8 billion. With an annual FCF potential of $2.5 billion, the company is positioned to increase dividends and pursue share repurchase.

JPMorgan Chase (JPM)

JPMorgan Chase (JPM) lettering on a corporate office in New York City.Source: Roman Tiraspolsky / Shutterstock.com

Banking stocks has been under-performers in the last 12-months. JPM stock has trended higher by 8% during this period. I believe that the 2.69% dividend yield stock is worth considering in a bear-market scenario.

One reason to be bullish on the banking sector in 2022 is the guidance for rate hikes. With interest rates remaining artificially low, the banks have witnessed growth primarily from non-core banking activities.

However, when interest rates trend higher, the cost of borrowing will increase for businesses and consumers. However, deposit rates are much slower to respond to rate hikes. The result will be a net interest income expansion for the banking sector.

Therefore, even if the broad markets trend lower, JPM stock might remain resilient. In particular, with the stock trading at an attractive forward price-to-earnings-ratio of 13.4.

For 2022, JPMorgan Chase set guidance for net-interest income of $50 billion as compared to $44.5 billion in 2021. A potential bear-market can impact trading or wealth management income. However, that’s likely to be offset by core banking business gains.

Overall, JPMorgan has a strong balance sheet and healthy cash flows. JPM stock seems positioned for a rally in 2022 and is worth holding in the portfolio.

Bear Market Stocks to Buy: Starbucks (SBUX)

Starbucks (SBUX) coffee cup on a counterSource: Natee Meepian / Shutterstock.com

SBUX is another low-beta stock that has been sideways in the last 12-months. The downside risk seems to be capped for this 2.02% dividend yield stock.

For Q4 2021, Starbucks reported revenue growth of 31% to $8.1 billion. For the same period, the company’s global comparable store sales increased by 17%. For the full year, global comparable stores sales increased by 20%. Considering the growth momentum, the stock seems to be attractively valued.

It’s also worth noting that Starbucks opened 538 new stores in Q4 2021. The rate of store opening has been robust. Further, stores in U.S. and China comprised 62% of the overall portfolio. However, in the coming years, it’s likely that Starbucks will be more diversified. There is significant untapped potential in countries like India.

Starbucks is also well positioned from a financial perspective. As of Q4 2021, the company reported $6.5 billion in cash and equivalents. Additionally, for the last financial year, operating cash flows were $5.9 billion.

Financial flexibility will ensure that store openings remain robust through 2022. On the flip-side, inflation is a concern as it might impact operating margins. However, it seems that the inflation factor is discounted in the stock price.

Equinor (EQNR)

Illustrative editorial of EQUINOR (EQNR) website homepage, with EQUINOR logo visible on display screen. ISource: II.studio / Shutterstock.com

In general, oil and gas stocks have a high-beta. However, there are exceptions and EQNR stock is among the quality names with a low-beta. A key reason for low stock volatility is a strong balance sheet and low break-even assets.

With Brent trending higher, EQNR stock has seen bullish momentum with an upside of 45% in 12-months. However, at a forward P/E of less than 10, the stock looks attractive. EQNR stock also comes with an attractive dividend yield of 2.48%.

In the next few years, the company’s Johan Sverdrup asset is likely to be a cash flow machine. The asset has a full-field break-even of $15 per barrel.

Even besides this asset, Equinor is positioned to deliver healthy cash flows. Between 2021 and 2026, the company expects free cash flow of $45 billion. With Brent trading near $80 per barrel, the FCF visibility is higher than guided.

Another reason to like Equinor is the big push towards renewable energy. Over the next five-years, the company expects to invest $23 billion in renewable assets.

It’s also worth noting that as of Q3 2021, Equinor reported net-debt ratio of 13.2%. A strong balance sheet and robust cash flows allow ample scope for dividend upside. In addition, Equinor has been aggressive on the share repurchase front.

Overall, EQNR stock is a quality stock to hold in a possible bear market. Furthermore, the stock is also worth considering for the long-term.

Bear Market Stocks to Buy: Microsoft (MSFT)

The Microsoft logo outside a building representing MSFT stock.Source: Asif Islam / Shutterstock.com

MSFT stock is another name to consider among bear market stocks. The stock has delivered healthy upside of 40% in the last 12-months. Even with a relatively unattractive dividend yield of 0.82%, the low-beta stock is worth adding to the portfolio.

Recently, investment firm Bernstein opined that Microsoft is likely to be among the big winners in the metaverse space. Bernstein has a price target of $364 for the stock. This would imply an upside potential of 19% from current levels of $306.

Microsoft has also been reporting strong quarterly numbers. For Q1 2022, the company’s revenue increased by 22% to $45.3 billion. The cloud business remains a key growth driver. For the last quarter, cloud revenue was higher by 36% to $20.7 billion.

It’s also worth noting that for Q1 2022, Microsoft reported cash flow of $19.1 billion. With an annualized cash flow potential of $80 billion, the business is a cash flow machine. This also allows Microsoft to invest in emerging technologies through the organic and inorganic route.

Overall, MSFT stock is likely to remain resilient in a broad market correction scenario. The stock is also worth holding for the medium to long-term as the metaverse trend continues to grow.

On the date of publication, Faisal Humayun did not hold (either directly or indirectly) any positions in any of the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modelling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector.

More From InvestorPlace

The post 7 Bear Market Stocks to Buy If You See Trouble Ahead appeared first on InvestorPlace.






interest rates

nasdaq

Author: Faisal Humayun

Continue Reading

Base Metals

Three Valley Copper’s (TSXV:TVC) Comprehensive ESG Plan Makes it an Industry Leader

Three Valley Copper (TSXV:TVC) is a company committed to environmental compliance with ESG criteria at the highest levels of compliance. TVC carries out…

Source: Three Valley Copper

Three Valley Copper (TSXV:TVC) is a company committed to environmental compliance with ESG criteria at the highest levels of compliance. TVC carries out best environmental practices in its operations, thus providing great value to shareholders in the long term. At the same time, the company is committed to maintaining strong community relations through actions that reduce environmental impact. 

Three Valley Copper builds strong relationships with the community under the policy of an open and permanent dialogue based on generating results that bring benefits to those involved. In this way, TVC achieves conflict resolution in an efficient manner. 

In May 2021, The Valley Copper received some neighbors from the community to show them the protocols in an in situ controlled blasting event. During the visit, community members were able to verify that the protocols required by regulatory authorities are applied on a daily basis at the operations. The event took place in an atmosphere of mutual respect and concern with the Sustainability Manager and other TVC executives.  

These are some of the points that visitors and members of the community confirmed:

  • Compliance with the protocols and procedures required for blasting to reduce dust emissions as much as possible. 
  • TVC’s commitment to the measures in place to control dust from the Don Gabriel mine and the Manquehua road. 
  • It was agreed with the community to maintain an open and constructive dialogue. 
  • It was communicated that an on-site inspection of the shock monitoring station will be carried out by an expert in order to verify and inform the community of the station’s operating methodology. 

The contributions made by TVS are based on emphasizing the ability to work in community. This method not only helps to establish relationships with the community but also favors community involvement, resulting in better project management and, therefore, better results. This synergy allows the development of the territory to be boosted. 

Social Responsibility, and a Foundation to Back it Up

The Three Valley Foundation was created in 2014 and its main distinctive feature is that it is made up of members of the community, representing the valleys of Chalinga, Cárcamo and Chuchiñi. It is through this foundation that Three Valley Copper channels its investment and carries out the financing of various social projects related to education, social infrastructure, rural health posts and more. 

The Environmental Aspect

Three Valley Copper is in a continuous search for process improvement and total openness of its operations to the external community. It is also committed to caring for the environment through strict compliance with environmental legislation. 

Three Valley has had a comprehensive Environmental Qualification Resolution in place for its operations since 2009. The Environmental Qualification Resolution provides companies with the fundamental instructions and permits necessary to execute operations in a sustainable manner in order to guarantee respect for the environment in a physical and social way. 

Some of the environmental obligations that Three Valley Copper has in the EQR are:

  • Uninterrupted monitoring of air and water quality.
  • Reforestation of 250 hectares with native species.
  • Construction of a petroglyph park at Quimenco. 

The Minera Tres Valles project operates with renewable biomass energy that was contracted to reduce the carbon footprint, as one of its priorities is the constant care of the environment. As another measure for environmental care, Three Valley Copper keeps its water consumption to a minimum, which has earned it several awards for its efficient use of this invaluable resource. 

Cultural Appreciation and Protection

Three Valley Copper’s project territory is characterized by its social and cultural heritage. As its name indicates, it is located in the heart of three surrounding valleys called Chalinga, Chuchiñi and Cárcamo.

The value of its social and cultural heritage is reflected in the traditions coming from this land.

One of the typical traditions of the region is the transhumance which is a type of seasonal grazing in continuous movement where cattle are taken from the valleys and lowlands to the Andes mountains and vice versa. 

Pilgrims celebrate the Virgin Mary with dances, songs and praises, which is one of the most important religious festivities in the Chuchiñí and Manquehua valleys.

In this region you can also find petroglyph art made by the pre-Columbian cultures that inhabited the valleys, generally following the watercourses.

The people have left traces of their culture that later generations will have the opportunity to know and continue to enjoy. 

 

The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a licensed professional for investment advice. The author is not an insider or shareholder of any of the companies mentioned above.

The post Three Valley Copper’s (TSXV:TVC) Comprehensive ESG Plan Makes it an Industry Leader appeared first on MiningFeeds.

tsxv

tsxv-tvc
three-valley-copper-corp

Author: Matthew Evanoff

Continue Reading

Articles

Guy on Rocks: True wealth in 2022 – happy days ahead, or heading down the toilet?

2021 set the scene for high levels of price volatility with inventories of all base metals falling over last year. … Read More
The post Guy on Rocks:…

Guy on Rocks is a Stockhead series looking at the significant happenings of the resources market each week. Former geologist and experienced stockbroker Guy Le Page, director, and responsible executive at Perth-based financial services provider RM Corporate Finance, shares his high conviction views on the market and his “hot stocks to watch”.

Market Ructions: Commodities 2022 – buckle up!

An unusual start to the year here in the West where wealth is no longer measured in your stores of gold bullion, property or cash but how many rolls of toilet paper and Panadol you have stashed away as the countdown to the border opening looms in early February 2022.

There is more discussion on the street about various types of face masks and their efficacy rather than the splendid performance of the Australian cricket team in the recent Ashes series. The one thing that is certain is that WA is about as well prepared for the border opening as England’s middle order batters were for the Ashes…

2021 set the scene for high levels of price volatility with inventories of all base metals falling over last year.

Tin was the best performing metal with a meteoric rise of 90% average, just over US$32,500 tonne, last year while the largest inventory fall was nickel, dropping 220,000 over the year or 8% of annual global consumption.

The good news however is that nickel prices (figure 1) have started the year with a bang and LME spot prices have risen to over $22,000/t, their highest level in 12 years, while LME stockpiles (figure 2) have been rapidly diminishing.

The strong price move has been spurred by positive sentiment towards nickel’s use in EV batteries. At the same time there has been plenty of activity in the exploration scene with BHP announcing a $50 million placement in Kabanga Nickel (Tanzania). The company is proposing to produce 40ktpa of Ni, 6ktpa of Cu and 3ktpa of Co from 2025.

Figure 1: 5-year nickel price (Source: www.kitcometals.com.au)
Figure 2: 5-year nickel LME stocks (Source: www.kitcometals.com.au)

Iron ore (figure 3) has also staged a comeback after dipping below US$90/tonne (62% fines) last year and is trading around US$124/tonne (after reaching highs around US$130/tonne in early January), representing a 6% rise last week.

Figure 3: Iron ore price chart (Source: https://markets.businessinsider.com/commodities/iron-ore-price)

Speculative buying and winter re-stocking have seen China add around 156 million tonnes at its ports, up 920,000 tonnes last week (figure 4). At the same time Chinese steel mills have increased production (and inventories – figure 5) with steel mill inventories falling 2.2% last week. Shipping out of Western Australia (Rio, BHP and FMG) has been off 7% from December average shipping rates.

Figure 4: Iron ore port stocks (Source: Macquarie Strategy, January 2022)
Figure 5: Chinese steel mill iron ore inventory, days use (Source: Macquarie Strategy, January 2022)

I have talked extensively about copper in the past and the red metal appears to be holding steady around US$4.41/lb despite the weakening economic outlook in China.

Not surprisingly the PBoC vice governor said the bank will roll out more policy measures to stabilise growth as downward pressures persist. In addition to this, the PBoC’s vice governor indicated that the bank will increase cross-cyclical policy adjustments this year with “relatively big” room for macro policies with more policy tools in reserve.

The PBoc lowered its one-year loan prime rate by five basis points to 3.8%, its first interest rate cut since April 2020.

Zinc came out of nowhere last year and is expected by many analysts to reach around US$3,700/tonne over CY 2022 with the global deficit equal to LME stocks. Battery metals such as lithium and cobalt have also been strong.

Figure 6: Zinc five-year price chart (Source: www.kitcometals.com)

As for gold the underlying uncertainty around the pandemic, radical fiscal and monetary policies, have seen price support above US$1,800/ounce. With inflation out of control (7% annualised rise last month in the US), anything could happen from here…

As Joe Foster (Van Eck) pointed out in a receipt article for Kitco:

“There have only been two other inflationary periods in the last 50 years. The first was in the seventies, the second from 2003 to 2008. In each of these inflationary periods, gold underperformed commodities in the first half and outperformed in the second half. It seems that markets don’t take inflation (or gold) seriously until it proves to be intractable.”

 

Company News

Figure 7: NXM 12-month share price chart (Source: CMC Markets, 19 January 2022)

As forwarded in my last column of 2021, I ran into some of the Nexus Minerals (ASX:NXM) luminaries on Hay Street West Perth just before Christmas and was pleasantly surprised by the 5-minute pitch.

The company, led by geologist Andy Tudor (managing director) and former paper shuffler Paul Boyatzis (chairman), has a portfolio of projects in Western Australia (figure 8) of which the Wallbrook Project (figure 9) is showing itself to have +1Moz of JORC Resource potential this year with drilling outlining mineralisation for a strike length in excess of 1.6km.

The company claims to have around 50km strike of prospective lithologies.

NXM is around a third of the way through a 30,000m RC drilling campaign that is designed to infill between the Crusader and Templar Prospects (figure 10).

Figure 8: NXM Western Australian exploration portfolio (Source: NXM ASX Announcement, 12 December 2021)
Figure 9: NXM Wallbrook Project regional geology (Source: NXM ASX Announcement, 12 December 2021)
Figure 10: NXM Crusader – Templar Long Section (Source: NXM ASX Announcement, 12 December 2021)

Exploration over 2021 outlined three distinct mineralised zones (Supergene, Hanging Wall and Footwall lode) which should significantly increase ounces per vertical metre. The company released results of 28 drill holes which not only returned excellent grades and widths, but also showed the mineralisation was continuous across 1.6km of strike.

Better results released on 21 December 2021 at Crusader – Templar included:

  • 29m @ 4.60g/t Au (within 71m @ 2.06g/t Au from 25m);
  • 13m @ 5.17g/t Au (within 25m @ 2.95g/t Au from 109m);
  • 10m @ 4.45g/t Au (from 74m);
  • 16m @ 2.31g/t Au (within 68m @ 0.98g/t Au from 28m); and
  • 5m @ 4.93g/t Au (within 8m @ 3.31g/t Au from 115m).

Three RC drill rigs and two diamond rigs are due to start this month and with an EV of around $95 million with $24 million in the bank, I believe NXM is in an excellent position to outline a 1-1.5Moz JORC Resource of good grade this year.

I think gold plays that can deliver +1Moz of open pittable mineralisation of decent grade (+1.5g/t Au), close to infrastructure are definitely worth having in the portfolio.

Anyway, after watching Seasons 4 and 5 of Billions (Season 6 is due out on January 23) I am feeling re-invigorated with a moral compass that has been re-aligned in the right direction. Next week I will be publishing the performance of my 2021 recommendations to see if I have added any value, or in the alternative, sent some of the Stockhead faithful down the “S” bend.

 

At RM Corporate Finance, Guy Le Page is involved in a range of corporate initiatives from mergers and acquisitions, initial public offerings to valuations, consulting, and corporate advisory roles.

He was head of research at Morgan Stockbroking Limited (Perth) prior to joining Tolhurst Noall as a Corporate Advisor in July 1998. Prior to entering the stockbroking industry, he spent 10 years as an exploration and mining geologist in Australia, Canada, and the United States.

 

The views, information, or opinions expressed in the interview in this article are solely those of the interviewee and do not represent the views of Stockhead.

Stockhead has not provided, endorsed, or otherwise assumed responsibility for any financial product advice contained in this article.

The post Guy on Rocks: True wealth in 2022 – happy days ahead, or heading down the toilet? appeared first on Stockhead.






Author: Guy Le Page

Continue Reading

Trending