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Un1qu3Nam3

6,266 Posts.

1199

04/01/16

14:22

Post #: 16722956
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Originally posted by rosencrantz ↑

what explains the rush for SBM shares in the middle of the usual holiday season torpor to push SBM stock within a whisker of its 2015 high ?
Short covering ?
At $1.47 ( 2 cents shy of its 2015 high) St Barbara has an enterprise value at $727M ( market cap ) + $210 (net debt) = $937m
A closer look at The presentation to the 2015 AGM reveals just how disconnected from the fundamentals of its peers the SBM share price has become .
I mean how many Aussie gold producers can now claim:
guidance achieved
cost reductions
debt reductions
Plenty..in fact most of the companies owning the gold mines in slide 44 of said presentation.
Companies such as Resolute, Silver Lake, Ramelius, Independence Group and Saracen .
But "St Barbara has strong cash generation relative to its peers"says the company in said presentation.
Well in respect of the above 5 it's inferior cash generation when measured against most metrics such as market capitalisation and reported profits . Then again St Barbara - so the rhetoric goes- has the ""technical and operational ability of its Gwalia team"" to improve upon a world class asset of 1.6 million ounzes in Reserves .
But most of the above 5 alternatives can boast similar such assets .
For a stock that is approaching $1bn in enterprise value I can find precious little insights in this forum on what justifies it .

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Thank you. I got in at 55c and got out at a $1.20 and now see it rising even higher to 1.40, 1.50... I'm not sorry. One Geo I spoke to in SBM told me he couldn't see any reason for why the price should exceed 1.20. And he was a pretty active investor in stocks generally, himself.

SBM Price at posting: $1.45 Sentiment: Sell Disclosure: Not Held
1 Upvote

0 Great analysis

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