In my very humble view, on first reading GDO stands up well. The market movements, (and yes the charts do reflect same), suggest to me that the recent sp retrace has seen a softening of the downward pressure after a strong surge and retrace. Indications are that a reversal of these short-term downward moves is picking up on the longer-term upward trend. This report reinforces such a position with guidance approx 20% above the close on Friday.
This (undated?) report points to very strong earnings growth, despite providing for higher inflationary/cost expectations and adopts a low ($1000/oz) basis for evaluation.
Investec has also reiterated the M&A activity in the sector along with the fact that they have yet to adjudge the merits or otherwize of the RAND acquisition. With Uranium hardly the flavour of the month, and global pressures, this Gold producer with assets and profits looks good value to me, particularly as we factor in the 17% stake at 53cents taken out recently.
My chartist friends tell me that the positive finish above the opening on Friday, suggests a clear reversal signal when placed in context with other indicators (including candle-stick formations). My view on charts is very rudimentary, however I deliberately avoid over-complications (read Simple-Is).
This is just my personal as a small retail investor with a SMSF view who has written to reinforce my sentiment and to read opinions.
Cheers, esp.
GDO Price at posting:
41.5¢ Sentiment: Buy Disclosure: Held
