The forward earnings are below 11 PE. The entire December run up is erased. Daily RSI just 30. Getting seriously oversold. No other gold or silver miner getting hit as bad as this one on zero negative news. Rouble rate above 56.3.
The company production is to grow by 21% over two years. The rise in the gold price over 12 months in 2017 was partly off set by the rise in costs but still at a consistently good margin. The company is significantly reducing debt with half the profit awarded as divis. The profit margin in 2017 was a good $450 per ounce over AISC. It is projected to be similar this year on the current gold price but on 10% higher production yet the market has responded with a big drop in its share price.
For the first time I have got it wrong on polymetal and I can not understand why. Hopefully more informed opinion will emerge after the conference call. Welcome more views from others here.
Allowing for debts, gold reserves and resources and a parallel breakdown of costs Polymetal would be 918p if it was running similar to Randgold metrics and 943p when corrected against Centamin (which has no debt but far less gold equivalence).
Shanghai gold buying yesterday was 240% above usual volumes for high purity gold bars. Some gold left Comex in New York to probably help meet high demand. Still the net effect was gold to decline which is odd. Over many years the data would suggest a big uplift in gold price. Of course the crypto bitcoin dropped a shed load and this may affect observations.
Whether Polymetal has acted in advance of something before its report in 5 trading days time, we shall have to wait and see. The company is certainly likely to meet its production target. The higher oil price and value of rouble is mainly off set by higher gold price for that time of year and also when compared with H1. A similar disruptive pull back pattern on Centamin SP before its report arose and the shares bounced back plus more. Interesting to see if the result proves similar.
In 2 days the stock is worth less than the rally over an entire month with no RNS news. Gold and silver doing fine. Pull back is with little volume. Dollar has also rallied against rouble. Company is on a 16% growth pathway in 2018. I added at 885 as oversold indicators were appearing. Fresnillo was pulled back as well but not as hard as Polymetal. Oil price also slipping which favours gold and silver miners.
That's quite a graph. Might be just technical selling but rather harsh on anyone who bought over GBP10......Why don't we see the same fluctuations with GOLD given its the same product in the same industry?
CEY has also underperformed badly compared to Randgold and the silver miners, but is starting to go today whilst Poly continues its decline, so my money has gone over there today with gold starting to break out after the non farm payrolls disappointed, and Poly having a broker downgrade.
Last I looked, POLY was about 950p. Now with gold at or over $1,300 it is at a much lower 864p. Perhaps those more knowledgeable of the company know why this share is falling while gold is generally rising? Randgold, on the other hand, has continued rising in line with gold from 700p to 790p.
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