The big volume traded last week seems to be have finished on Friday and there are no signs of big selling today. Maybe the selling has finished or it is just having a pause. Time will tell, but it appears to have finished for now.
All the signs were pointing to maybe one or more substantial holder selling last week. The most obvious candidate is Regal Funds who in late March ceased being a substantial holder. They lodged a substantial notice in Feb this year with 65,665,745 shares and then in March they ceased being a substantial holder after selling 18,230,735 shares. So that would mean they were still holding 47,435,010 shares as at late March. My guess is that they continued to sell down and last week may been Regal exiting the stock completely.
What I'm more interested in is the buyer(s) that appeared on Wednesday and soaked up the selling and interestingly in spite of the selling the share price closed the week at the same level it was on Tuesday. So, there were some positive signs there. Other than what I saw on the screen, I don't have any insight into who was buying but my spidey senses tell me there was a buyer quietly building a position. Not sure if it was a corporate player or simply a big investor but the conditions were textbook perfect for a buyer to get plenty of stock without pushing the price up. If someone has been waiting in the wings wanting to get a position, last week may have been go time. The stock has been on the nose, substantial holder selling, retail investors fleeing, and you have the perfect opportunity.
Sometimes when you have all the above conditions present in a stock and when everyone is negative on the outlook, a party will emerge with a stake and surprise the market. I stress that I'm not suggesting this is the case here, and it's based on nothing but previous experience and gut feel.
I'm not here to argue the fundamentals of the stock as everyone has their own views but the issue of AISC going up has been seen across most of the producers this quarter. The history with BLK is not good, based on how much capital has been pumped into this asset (previous owner included) so it's understandable that there are worries about the outlook. I'm not sure what share price reflects the true value for the asset but if we assume that the resource and reserves figures are true, and given the location of the asset and it's proximity to assets owned by other players, one might assume that BLK is worth more than the current $68-70m EV.
I guess time will tell but I'm keeping an open mind.
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