CRITERION Ramelius Resources (RMS) 47c The mid-tier WA gold...

CRITERION



Ramelius Resources (RMS) 47c
The mid-tier WA gold producer exemplifies the value exuding from the local sector after the global bullion bashing of the last few weeks.
Ramelius yesterday reported record September quarter output of 36,179 ounces, above guidance of 31,000-35,000oz and putting the digger on track for 2016-17 output of 135,000 oz.
The all-in cost of production for the quarter was tipped to come in at less than $A1100/oz, compared with the current Aussie dollar gold price of $1662/oz. “The bottom line cash generation is undeniable at current Aussie dollar gold price levels,’’ says Ramelius chief Mark Zeptner.
Ramelius poses execution risks as it shuts down the smaller Kathleen Valley facility and opens two more: the underground Water Tank Hill and the Blackmans open pit (both part of the Mt Magnet project).
Broadly, the latest weaker than expected US job numbers douses expectations of a rates rise — until the next economic data, that is — and eases the recent pressure on the gold price.
On a less supportive note for the safe harbour commodity, Hillary Clinton would seem to have the presidency done up like pussy’s bow after Donald’s Trump’s latest indiscretions.
But as Evolution Mining’s Jake Klein remarked last week, no-one gave Brexit a chance either. Ramelius’s $250m market worth is backed by $88m of cash. On locker room banter that makes it a speculative buy.
The Australian accepts no responsibility for stock recommendations. Readers should contact a licensed financial adviser. The author does not own shares in the companies mentioned.