Possible trigger for breaking the $5 glass ceiling...?
(Altho long time holders and watchers are well aware of the intense buildup and many big district-scale projects all over the place, which have arguably made this current rise into the $5.20's somewhat overdue... last year, before the big boys got involved during the 100m CR, many of us normal little retailers could already foresee value above $10 as drilling results become available for other parts of Julimar, or for Thor in the South West Project, which is the JV with Venture Minerals over their "Julimar Lookalike"..)
3 days ago, when the price was still hovering in the $4.90's, a leading Fund Manager for superfunds was interviewed for an online newsletter... and drumroll please... he listed Chalice in his top picks, with an estimation that it could rise over 500%..
No, that is not a typo. A 5 with two zeros...
and that's for mining industry in general. Then he goes on to say why he believes Chalice deserves his top rankings;
I think the link may get moderated but the interview title is: "Phil King’s next three big plays"
In part it says: Phil King is a gold mine of new ideas and they tend to pay off... In the current market King sees no signs of a bursting bubble, in fact, he sees the opposite.
"Certainly on our analysis, the market is not over-extended. Returns in the market, over the last five years - of around 5.1% in capital appreciation - have been well below the 100-year average of 5.6%... That means the risk of a large correction is low.
"Most crashes in the market occur after the market becomes overextended and after the returns, on a rolling five-year basis, are a long way above average," says King.
He posits the COVID-recovery as a sound case study for this market philosophy. One of the reasons the market was able to bounce back so quickly, he said, was because the market was not over-extended at the time...
... and his strategy remains unwavering. With one eye on the market, the other staring intently at company records, King's strategy has paid off. According to his keen eye, there are three definitive plays moving forward.
#1 The mining bull market could go up 500%
"Many people underestimate both the duration and the leverage of the mining bull market. Mining markets last, on average, at least five years and they go up around 500%, on average.
"We think the current bull market in the mining sector is only just starting...
Since the commodity prices collapsed we've seen a huge hangover in the mining sector, he said. There has been very little re-investment in the mining sector and the big mining companies have avoided large acquisitions and new mine openings.
"... we think that this underinvestment in supply is going to lead to a period of very strong commodity prices," he said.
The surge of global fiscal stimulus will be the cure to this underinvestment.
"After World War Two's fiscal stimulus we saw the longest bull market in mining stocks in Australia, and we think we're going to see something similar going forward. This global fiscal stimulus has meant that economic growth over the next five years will be almost twice what has been over the last five years, and we'll get back to the levels that we saw in the 2000s," he said.
"We're bullish both bottom-up reasons just because of the supply and demand dynamics, but also for top-down reasons. And as bond yields trend higher over the next few years, that usually leads to mining stocks outperforming the broader market," said King... (who) is extremely bullish on copper because of the global trends towards electrification and decarbonisation.
In his top 2 picks he says: Chalice (ASX:CHN), which owns 100% of the Julimar project, a tier-one ore body which could produce as much as 15 to 20 tonnes per annum - "one of the best discoveries we've seen in a decade," said Regal's head of mining, Tim Elliott.
End of extracts. But worth googling the rest of the interview too, albeit less relevant to this thread.
CHN Price at posting:
$5.30 Sentiment: Buy Disclosure: Held
(20min delay)