Mercantile Investment Company Limited is a stock that has run from about $0.07 at the end of last month to an intraday high of $0.14 yesterday. Today the stock closed down $0.01 to $0.12.
The problem is that the stock is running on hype and not fundamentals. Those readers with a long memory will remember that I used to write about the stock when was under the guise of India Equities Fund. Whilst those still holding will have made good returns, it has been a long road that Im sure many have turned off sometime ago.
The company is an investment company holding listed stocks including CSE, TCQ, IFL, API and TJN. It has to be noted that listed investment companies nearly always trade at a discount to Net Tangible Assets (NTA) or NTA backing. The company has an NTA of $0.0734(31/01/2012) and recently completed a placement at $0.08.
So why does the stock has a premium share price compared to NTA? It is purely based on the fact that Sir Ron Brierley is on the board and is a renouned investor. The premium is way too high for my liking.
Tuesday, March 13, 2012
Tuesday, February 14, 2012
Exoma Energy (EXE)
Exoma Energy Limited (EXE) is definitely one to watch in short to medium term. The company ticks many boxes in the fundamental and technical department of analysis. The stock price has seen a nice steady increase in volume and price of late unlike many stocks which have overcooked and received ASX price queries.
Interest in CSG in the Galilee Basin is on the increase again. Today, Westside Corporation (WCL) received a unbinding takeover bid of $0.65 per share. This company has projects both in the Galilee and Bowen Basins. Exoma Energy in the meanwhile has appointed a corporate adviser to handle further growth and advise "on appropriate corporate strategies in light of the growing interest in Exoma's portfolio of prospective hydrocarbon resources, including conventional oil, shale oil and associated gas and coal seam gas" This statement is very suggestive. It suggests that other companies are taking a close look at their assets and have been making enquiries.
Considering that EXE already has China National Offshore Oil Corporation (“CNOOC”), a highly regarded department of the China government, providing $50 million in funding for a 50% share in its ATP's they must have receive quite a lot of interest to appoint a corporate adviser. After all, why would you make such an appointment when you are very much funded? Why the need to promote your company to instituitions when you are at such as early stage?
It must also be noted that EXE is awaiting Queensland government granting of further tenements which could provide positive newsflow.
The stock closed down $0.005 to $0.195 today.
Interest in CSG in the Galilee Basin is on the increase again. Today, Westside Corporation (WCL) received a unbinding takeover bid of $0.65 per share. This company has projects both in the Galilee and Bowen Basins. Exoma Energy in the meanwhile has appointed a corporate adviser to handle further growth and advise "on appropriate corporate strategies in light of the growing interest in Exoma's portfolio of prospective hydrocarbon resources, including conventional oil, shale oil and associated gas and coal seam gas" This statement is very suggestive. It suggests that other companies are taking a close look at their assets and have been making enquiries.
Considering that EXE already has China National Offshore Oil Corporation (“CNOOC”), a highly regarded department of the China government, providing $50 million in funding for a 50% share in its ATP's they must have receive quite a lot of interest to appoint a corporate adviser. After all, why would you make such an appointment when you are very much funded? Why the need to promote your company to instituitions when you are at such as early stage?
It must also be noted that EXE is awaiting Queensland government granting of further tenements which could provide positive newsflow.
The stock closed down $0.005 to $0.195 today.
Plenty of Action!
The ASX 200 was much weaker today with the indice down 1% or just over 42 points. Isn't it interesting now that the Greek bailout has been passed by their parliament that the negative headlines are once again coming out again? Today I read all the negatives such as the rioting in the streets of Athens and that Greece will still have an orderly default by the end of year.
Back in the small cap space there is still plenty happening! Confidence has definitely come back in this area.
Maverick Drilling (MAD) had its first down day in almost a week. The stock closed down $0.03 to $0.69 after shooting to a high of $0.835 earlier in the day after responding to an ASX price query. In what must have been the longest response I have ever seen (4 pages) the cites many reasons including broker research, publications and past announcements.
In the uranium sector Uranex Limited (UNX) was up 32.% to $0.45 on volume of 2.4 million units. The company is currently in discussions with unnamed Chinese parties regarding joint ventures for its Uranium project in Tanzania. Fellow uranium Alliance Resouces (AGS) was also strong and up $0.05 to $0.41.
Back in the small cap space there is still plenty happening! Confidence has definitely come back in this area.
Maverick Drilling (MAD) had its first down day in almost a week. The stock closed down $0.03 to $0.69 after shooting to a high of $0.835 earlier in the day after responding to an ASX price query. In what must have been the longest response I have ever seen (4 pages) the cites many reasons including broker research, publications and past announcements.
In the uranium sector Uranex Limited (UNX) was up 32.% to $0.45 on volume of 2.4 million units. The company is currently in discussions with unnamed Chinese parties regarding joint ventures for its Uranium project in Tanzania. Fellow uranium Alliance Resouces (AGS) was also strong and up $0.05 to $0.41.
Saturday, February 11, 2012
Hastings Rare Metals Research Report
- RM Research has released a research report on Hastings Rare Metals (HAS)
- Research report dated 06/02/2012
- Rated as Speculative Buy
- HAS last trade: $0.17 (10/02/2012)
- Research link
Thursday, February 9, 2012
Balamara Resources - 'Nearology Play'
Balamara Resources (BMR) is a stock that I have been monitoring over the past week. There hasn't been a massive volume day that has caught my attention like some of the other stocks I have been posting about lately. The rise has been a consistent one with increasing volumes.
The ASX is on the ball. Today the company received a price query asking why the stock has moved from $0.01 on 03/02/2012 to $0.016 today. Balamara Resources had no explanation and referred the ASX to recent announcements.
The company used to go by the name of Sultan Corporation (SSC) however has now rebranded itself. It depends on how you are playing a stock that will determine if this speeding ticket is a positive or negative. Those that took a position as a daytrade will probably be disappointed as inevitably a stock will experience weakness after a speeding ticket. There is the perception that a company cannot announce any price sensitive news for a little while after responding. If you dont fit into the above category then I think it's a positive...
The stock may be weak for a day or so which could be a good chance for those wishing to open a position before it's next upward move. I do think that there is a bit of news flow for this company to look forward to. For a starter, the company is about to commence drilling at it's base metals project in Poland. For those that like to take a punt on 'nearology' plays then it may be worth researching further. The company claims it's project lays immediately adjacent to Europes biggest Copper producee (KGHM).
On another front the company is in good communications with the Togo government regarding the tender process for a phosphate deposit. This news, however, could be months away.
The ASX is on the ball. Today the company received a price query asking why the stock has moved from $0.01 on 03/02/2012 to $0.016 today. Balamara Resources had no explanation and referred the ASX to recent announcements.
The company used to go by the name of Sultan Corporation (SSC) however has now rebranded itself. It depends on how you are playing a stock that will determine if this speeding ticket is a positive or negative. Those that took a position as a daytrade will probably be disappointed as inevitably a stock will experience weakness after a speeding ticket. There is the perception that a company cannot announce any price sensitive news for a little while after responding. If you dont fit into the above category then I think it's a positive...
The stock may be weak for a day or so which could be a good chance for those wishing to open a position before it's next upward move. I do think that there is a bit of news flow for this company to look forward to. For a starter, the company is about to commence drilling at it's base metals project in Poland. For those that like to take a punt on 'nearology' plays then it may be worth researching further. The company claims it's project lays immediately adjacent to Europes biggest Copper producee (KGHM).
On another front the company is in good communications with the Togo government regarding the tender process for a phosphate deposit. This news, however, could be months away.
Tuesday, February 7, 2012
Bandanna Energy - Bidders back?
I was alerted to Bandanna Energy (BND) recently when the stock had a massive volume day of over 26.2 million units Thursday last week (02/02/2012). The stock surged up $0.105 to $0.76 on that day. Considering the stock hasn't seen that much of a daily volume for years it went on my watchlist.
I've been looking further into the stock over the last few days. Last year the company effectively put itself up for sale with potential acquirers running the ruler over the company. Bandanna Energy also had employed corporate advisors to assist in the process.
Unfortunately the bidders evaporated and the company put that down to deteriorating and/or poor conditions on equity and credit markets. In the end BND raised $100 million in funds from Insto investors at a price of $1 per share plus a further $1.1 million from retail investors. The insto entitlement offer was oversubscribed however the retail entitlements were poorly subscribed to as the market price dipped below $1 issue price.
One has to wonder if a bidder is revisiting BND. After all, market conditions are a lot brighter. The ASX trading band has tightened to 4200 - 4300, there are excellent signs coming out of the US and a Greek debt default appears slimmer. Interestingly enough the RBA decided today to keep the cash rate on hold citing these reasons, which startled the market. The ASX 200 dropped after the news whilst the Australian Dollar surged.
The volume on 02/02/2012 could be a very good signal. Should a bidder come for BND you would expect that it would have to exceed the recent raising completed at $1 which leaves a lot of upside. You've also got to remember that even if a bidder doesn't appear the stock was over $2 only six months ago. There's recovery in it at least.
I've been looking further into the stock over the last few days. Last year the company effectively put itself up for sale with potential acquirers running the ruler over the company. Bandanna Energy also had employed corporate advisors to assist in the process.
Unfortunately the bidders evaporated and the company put that down to deteriorating and/or poor conditions on equity and credit markets. In the end BND raised $100 million in funds from Insto investors at a price of $1 per share plus a further $1.1 million from retail investors. The insto entitlement offer was oversubscribed however the retail entitlements were poorly subscribed to as the market price dipped below $1 issue price.
One has to wonder if a bidder is revisiting BND. After all, market conditions are a lot brighter. The ASX trading band has tightened to 4200 - 4300, there are excellent signs coming out of the US and a Greek debt default appears slimmer. Interestingly enough the RBA decided today to keep the cash rate on hold citing these reasons, which startled the market. The ASX 200 dropped after the news whilst the Australian Dollar surged.
The volume on 02/02/2012 could be a very good signal. Should a bidder come for BND you would expect that it would have to exceed the recent raising completed at $1 which leaves a lot of upside. You've also got to remember that even if a bidder doesn't appear the stock was over $2 only six months ago. There's recovery in it at least.
Sunday, February 5, 2012
Jacka Resources & Pancontinental Oil & Gas Link
Pancontinental Oil & Gas (PCL) is a stock I mentioned on Thursday night as one to watch on Friday after it came up on my scan. The stock managed to hold it's strong gains from Thursday and finish even at $0.11 on Friday (03/03/2012), again on good volume. The stock hasn't gone unnoticed with the ASX as after market a price and volume query was issued and responded to. The company advised there was nothing that needed to be announced to the market.
Hartley's issued a research note on the company earlier in the week which may have prompted more interest in the stock. Hartley's rates the stock as a Speculative Buy and has a six month target price of $0.23 due to a number of catalysts.
It is interesting to note that Jacka Resources (JKA), a stock first mentioned in a July post last year (also $0.11 at the time), had it's shares up $0.01 to $0.165 on Friday on good volume. So the link? Both companies have a joint venture to pool resources to evaluate petroluem acreage opportunities in East Africa. I am wondering if JKA has started running as a result of PCL running and the market is simply guessing that they may have finalised an application for an onshore asset.
Considering PCL received a 'please explain' from the ASX on Friday it will probably take the wind out of it's sails. If JKA continues to rise there may be some news directly and only related to JKA around the corner. If JKA backs off then we know the market was only speculating on joint venture.
One thing is for sure, JKA technically looks great so if the rise is not broken then definitely keep an eye on it!
Hartley's issued a research note on the company earlier in the week which may have prompted more interest in the stock. Hartley's rates the stock as a Speculative Buy and has a six month target price of $0.23 due to a number of catalysts.
It is interesting to note that Jacka Resources (JKA), a stock first mentioned in a July post last year (also $0.11 at the time), had it's shares up $0.01 to $0.165 on Friday on good volume. So the link? Both companies have a joint venture to pool resources to evaluate petroluem acreage opportunities in East Africa. I am wondering if JKA has started running as a result of PCL running and the market is simply guessing that they may have finalised an application for an onshore asset.
Considering PCL received a 'please explain' from the ASX on Friday it will probably take the wind out of it's sails. If JKA continues to rise there may be some news directly and only related to JKA around the corner. If JKA backs off then we know the market was only speculating on joint venture.
One thing is for sure, JKA technically looks great so if the rise is not broken then definitely keep an eye on it!
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