ASX Speculative Shares News and Tips
Gold Shares to Buy: Azimuth Resources (AZH)
Azimuth Resources (ASX:AZH) is a junior gold and uranium explorer, with projects based in Guyana and South America. The group holds approximately 8000km2 of gold tenements in Guyana, and its main asset is the West Omai gold project, which it is currently exploring. AZH’s other interests are the East Omai gold project, the Amakura uranium project, and the Pandanus West uranium project in Australia. The company is an exciting prospect that has produced encouraging drilling results at West Omai. There is growing hope that the group’s maiden resource discovery will be significant enough to help underpin the start of production. Go Guyana The West Omai project is AZH’s flagship project, and which may contain the discovery of significant gold resources. West Omai is part of the same corridor that hosts the Omai gold mine, which is the biggest gold mine in South America, having so far produced 3.7 million ounces of gold. Azimuth Resources is expected to release a maiden resource estimate from the project sometime this quarter. Given West Omai’s proximity to the Omai gold mine and the encouraging drilling results thus far, a significant resource discovery could be on the cards. Gold shoots higher Being an explorer, AZH is tightly leveraged to gold prices. Although gold was sold-off heavily in September, the precious metal has bounced back strongly in recent weeks amid global economic uncertainty. The spot price of gold is back above US$1750 an ounce after crashing to just above US$1500 in late September. Europe’s debt crisis and the potential for another round of bond purchases by the Fed is likely to lure more nervous investors back into gold, which is likely to support prices further. Such an outcome would be very beneficial for AZH. Balanced out AZH completed a $19.4 million capital raising on 31 October, giving it the balance sheet strength to pursue its Guyana exploration program well into 2012. The raising has come at an ideal time for AZH, which has smartly taken advantage of its strong share price to shore up its finances. The group also announced plans in April 2011 to list on the Toronto Stock Exchange. The listing is expected to boost AZH’s global profile, which will come in handy when the group looks at future capital raisings. Outlook AZH an exciting prospect that has produced encouraging drilling results at its West Omai project. The group is expected to release a maiden resource estimate from the project sometime this quarter, and there is hope the estimate will be significant enough to help underpin the start of production. AZH’s fortunes are closely linked to the price of gold, and with the precious metal on track for continued gains, we believe this will translate into continued strength for AZH’s share price. This is one of the hot stocks of the year, rising from 25 cent in June to currently be trading beyond 50 cents. For further FREE Trading Recommendations Click Here.
Gold Shares to Watch: Northern Star Resources (NST)
Northern Star Resources (ASX:NST) explores and develops mineral resources in the highly prospective Kimberley region. NST is an emerging gold producer and explorer with a market capitalisation of around $180 million. Its main project is the Paulsens gold mine which it purchased for $40 million. The miner expects to release a resource upgrade later this month and a new mine plan for Paulsens this year. NST recently acquired the 668,000 ounce (oz) Ashburton Gold Project which is close to the Paulsens mine. Precious metal speed hump We saw gold and silver futures slide recently as investors reacted to hikes in margin requirements for the contracts. The CME Group raised margin requirements for both initial and existing positions in gold, copper and silver. Margins are money investors must put up to be able to trade and hold futures contracts. Gold lost more than US$100/oz on the announcement, printing a low of around US$1533/oz. However, gold prices have since recovered from that low and are currently hanging at around US$1665/oz. The fact of the matter is, the underlying fundamentals behind the gold price rally over the past year are still intact and we are likely to see gold continue to rise. Ashburton acquisition NST agreed to purchase the Ashburton Gold Project from Sipa Resources which will be paid for via a royalty on future production. The deal includes 668,000oz resource and the Mt Olympus Gold Mine, which has previously produced 340,000oz. This puts NST in a prime position to increase production rates, project life and create shareholder wealth through exploration. Ashburton is a strategic asset for Northern Star Resources as it provides an immediate resource boost to the miner’s resource base. High grade drilling results from Ashburton announced last week show NST is on track to grow production to 200,000ozpa. Results NST recently posted FY11 profit before tax of $20 million. This profit came after deducting $22 million for the acquisition of Paulsens gold mine and $24 million in depreciation and amortisation expenditure. The result was aided by record production at Paulsens of 87,069oz at $588/oz cash cost. NST has $30 million in cash on hand as at 27 September 2011 and is on track to exceed calendar 2011 forecast of $40 million surplus cash, 75,000oz production. A resource upgrade is set for early 2012 with increases in mine life, production and cashflow expected. The miner repaid the $40 million acquisition of Paulsens in just seven months. Being unhedged, NST has maximum exposure to the strong gold prices and as a result it was one of the hot stocks over the course of 2011. With strong cashflow and a robust balance sheet, NST is in a good position to grow. Outlook Gold is set to recover after recently suffering a setback from the CME’s decision to raise margin requirements. NST’s strong financial position leaves it well placed for further acquisitions in line with its objective of building a major mining house. With the potential for further acquisitions and strong gold prices backing the unhedged miner, we feel NST will be one of the stocks to watch in coming months. Recent weakness presents an excellent opportunity for fresh entries. Receive FREE Trading Recommendations for the next 7 Days, Click Here!
Australian Shares News Karoon Gas Australia (KAR)
Karoon Gas Australia (ASX:KAR) is focused on identifying, exploring and developing acreage that is highly prospective for oil and gas. The company currently has three focus areas - the Browse Basin (Western Australia), Tumbes Basin (Peru) and the Santos Basin (Brazil). KAR holds a 49% interest in oil and gas exploration permits WA-314-P and WA-315-P in the offshore Browse Basin located 350 km offshore from the North-Western Australian coastline. The company’s joint venture partner and operator in these projects is ConocoPhillips, the world’s fifth-largest refiner. Gas gas gas KAR was one of the best performers of the day, rallying over 6% after receiving environmental approvals to start drilling on its Browse Basin projects. The company will move on to phase two of its drilling program in the region. The program will start in the fourth quarter of the year and run for 18 months to two years. Click for Daily Trading Recommendations
Rare Earth Shares News Lynas Corporation (LYC)
Lynas Corporation (ASX:LYC) is involved in the exploration and development of rare earth minerals. LYC owns the richest deposit of Rare Earths in the world at Mt Weld (Western Australia), 35km south of Laverton in Western Australia. Mt Weld is also the world’s largest deposit outside China, with supply due to begin in 3Q11. Though Rare Earths demand dipped in 2009, prices are now recovering and current resources are struggling to maintain production. LYC benefits from its strong ties to Rare Earths resources (whilst potential competitors face Rare Earths mineral scarcity) and as growth forecasts surpass new supply coming to the market. Rare loss LYC shares plunged on Friday after its Malaysia plant suffered a setback. Malaysia’s government has put restrictions on the plant until the company complies with recommendations in a report commissioned by the International Atomic Energy Agency. LYC came out with a statement denying any unusual construction difficulties and claiming its plant is being built to international standards. A selloff by spooked investors saw the stock finish the session down over 11%. Free Trading Recommendations
Shares to Buy News Regis Resources Limited (RRL)
Regis Resources Limited (ASX:RRL) is an emerging Australian gold production and exploration company. Its management team has a successful track record of developing mid sized gold operations within Australia and Africa. RRL’s flagship is the 100% owned Duketon Gold Project, 130km north of Laverton in WA. Operations commenced in August 2010 following the construction of the Moolart Well Gold Mine and the mine boasts a JORC reserve of 603,000 ounces (oz). Average production is expected to be 90,000oz over a six year mine life. Regis Resources is confident that Moolart Well offers further reserve and resource growth potential from continued exploration programmes. RRL also has the Garden Well project which is located 30km south of Moolart. A maiden ore reserve at the Garden Well deposit highlights the potential of the region. Returning to profit The commencement of operations at the Moolart Well Gold Mine saw RRL report a profit after tax of $13.52 million for the half year ended 31 December. This equates to an earnings per share of 3.23 cents. The result was a huge improvement from a loss of $17 million the previous year. Gold sales for the period came in at $42.481 million. This was from the sale of 24,207 oz at an average delivery price of $1,408 per oz. RRL has cash and gold bullion holdings of $21.5 million. Gold production for its first full quarter of operation (up to December 2010) was 23,851 oz. A pre-royalty cash cost of $450 per oz was achieved. Resource update RRL recently announced a reserve increase at Garden Well to 1.66 million ounces (moz) contained gold. Even more impressive is the fact that 90% of the reserve at Garden Well is within 200 metres of surface and 99% of the reserve is within 250 metres of the surface. This update increases RRL’s total JORC compliant reserves to 2.5 moz of gold. RRL believes the updated 2.14 moz resource at Garden Well confirms the likelihood of further reserve upgrades at the project. The miner expects Garden Well to produce approximately 180,000oz of gold per annum. Successful development of the Garden Well deposit should lift RRL’s gold production to around 270,000 oz per annum commencing FY13. Should it achieve that production rate, RRL would be a well established mid tier gold miner. Gold boom and outlook RRL is moving towards commencement of a second stand alone mining operation at Garden Well in the September 2011 quarter. Gold has gained significantly this year, reaching fresh record highs last month as global economic uncertainty, natural disasters and tension in North Africa and the Middle East pushes investors towards the safety of the shiny metal. The metal printed highs of around US$1577 last month and continues to hold its ground well above US$1500. With plenty in the reserve growth pipeline and rising gold prices, we feel RRL has plenty of upside potential. Click for more Shares to Buy Advice
Top Stocks News Resolute Mining (RSG)
Resolute Mining (RSG) is a gold mining and exploration company, operating primarily in Africa and Australia. The group’s portfolio focus is on Africa, but the miner also has projects in Australia, Mali and Tanzania. RSG has three operating mines: Golden Pride in Tanzania, Ravenswood in Queensland, and the newly re-developed Syama in Mali, which was once a BHP Billiton operation. RSG’s operations are well-placed, and exploration is likely to lead to further resource discoveries, underground, and in nearby pits. The company continues to benefit from a boom in gold prices. Golden update RSG this week provided its Group gold production and cash cost guidance for FY12. Gold production in the coming year is forecast to increase to 410,000 ounces at a cash cost of $730 per ounce. This cements RSG’s position as the second largest primary listed gold producer on the ASX. It also represents a substantial increase in production and reduction in cash costs. RSG’s continued improvement in outlook is underpinned by ongoing progress being achieved at the Syama operation in Mali. Resolute mining shares surged 7.6% on the back of the news. Click for Daily Top Stocks Advice
Rare Earths Shares to Buy Alkane Resources (ALK)
Alkane Resources (ALK) is a multi-commodity explorer and miner focussed in the Central West of New South Wales. Its Dubbo Zirconia Project is a world class resource of zirconium, hafnium, niobium, tantalum, yttrium and rare earths. ALK also has a new gold development planned at Tomingley based upon an 800,000 ounce (oz) resource. Additionally, ALK made a major gold discovery at McPhillamys (3 million oz) with its joint venture partner Newmont. ALK aims to develop multiple operations within a tight geographic area over the next five years. Rare metals and rare earths are a unique proposition given their use in green technology. Demand for many of the metals is being driven by environmental legislation to ensure emissions minimisation and energy consumption efficiency. Demand looking strong Rare Earths have long been considered a strategic resource for China, with LYC the nation’s only major competitor. China controls more than 90% of the accessible resources of rare earth metals. Over the last few years, there has been a trend in Chinese Government policy decisions supportive of government control of the Rare Earths industry in China. ALK shares have soared over the past year following news the Chinese Ministry of Commerce announced restrictions on Rare Earth exports. The total export quota for 2010 (30,259 tonnes) is 40% less than the total export quota for 2009 (50,145 tonnes). In addition, the export quota for 2H10 (7,976 tonnes) is 72% less than the export quota for 2H09 (28,417 tonnes). With China deciding to keep most of the world’s supply to itself, it leaves Alkane Resources and its peers in a good position to cater for buyers elsewhere. China is expected to continue reducing export quotas for rare earths in the coming years. A reduction in the order of 5%-10% is anticipated next year. The trend will likely continue until the Chinese government achieves its strategy of restructuring its rare earths industry, addressing environmental issues and preserving its resources for the long term. Free Shares to Buy Advice Quarterly update In February, ALK completed a $21 million capital raising. The funds will be used to complete its current projects and for further resource evaluations. According to ALK, the potential revenues from DZP products continue to increase assisted by escalating zircon prices, the Chinese Government classification of zirconium as a strategic metals and an indication of future preferences for value added zirconium products, and further restriction of their rare earth exports. Base case revenues at the rate of 400,000 tonnes per annum ore processed are now estimated at US$180Mpa with project open pit life of at least 200 years. The expanded case of 1Mtpa could generate revenues of US$450Mpa. The base case development for its Tomingley gold project confirmed a production of 370,000 oz of gold over a seven and half year life. Operating cash flows for this project are estimated to be $155 million with a capital cost of $95 million. Looking ahead ALK has built a substantial resource base and is proceeding towards several developments. Following the capital raising, the company is well funded to pursue its projects. Alkane Resources is prospecting and mining key commodities at the moment which are experiencing increasing demand and prices. Peers such as Lynas Corp (rare earths) and Iluka (mineral sands) have experienced strong gains over the past few months as investors acknowledge the value of their minerals. Click for more Shares to Buy advice.
Shares to Buy Base Resources (BSE)
Base Resources (BSE) is an exploration company developing the world-class Kwale Mineral Sands Project in Kenya, East Africa. BSE also boasts a portfolio of early stage exploration projects in Western Australia’s Mid West region, with established targets for iron ore, gold, base metals and uranium. An updated and enhanced definitive feasibility study (DFS) for Kwale will be completed in the June quarter of 2011 with off-take and financing arrangements slated for the third quarter of 2011. BSE is looking strong on a forecast supply shortfall for mineral sands – including ilmenite, rutile and zircon – in 2013 – therefore it will be one of the stocks to watch over the medium term. In the same year Kwale will come into production and Base Resources is poised to meet this supply shortfall. The company released its Quarterly Activities Report at the end of last week, detailing its progress at its key projects. Kwale coup Kwale is an advanced and highly competitive project in a sector with a significant forecast supply shortfall widely expected to emerge in the medium term. The project enjoys a high level of support from the Government of Kenya and is located just 50km from Mombasa, Kenya’s principal port facility. Importantly, two pilot plant operations at Kwale provide confidence in processing behaviour and indicate a suite of readily marketable products. The project’s high value mineral assemblage and low stripping ratio result in a projected revenue to cash cost ratio that would place Kwale in the top quartile of world producers. Minerals sands supply Kwale is being developed via Base Titanium, a subsidiary of BSE. The object of the project is for BSE to capitalise on a forecast sustained opportunity in the mineral sands market. A mineral sands market supply shortfall is slated by 2013, creating upward pressure on prices to motivate sufficient supply, as China is the new driver of world demand growth. Mineral sands include ilmenite, rutile and zircon – essentially the basis of “lifestyle products” via their primary end-uses. All three products are set to face a supply deficit in 2013 – ironically coinciding with the date of Kwale’s first production. Mineral sands demand growth is slated at around 3% per annum as part of a long-term trend. Quarter ramp-up Late last week BSE released its quarterly activities report for the three months of 2011. The quarter’s highlight was the updated JORC-compliant resource estimate of the Kwale project, which we had foreshadowed in our previous coverage of BSE. The miner made good progress on its Enhanced Definitive Feasibility Study (EDFS), which is on schedule to be completed next month. BSE has also made progress in attracting financing for the project, with a lead manager appointed to arrange a syndicated loan of $150 million and combined indicative commitment levels already reaching the $150 million threshold. Outlook BSE is working towards taking advantage of Chinese demand for mineral sands via Kwale, which has the full support of the local government and is close to existing infrastructure. Funding for the project is expected to be in place by the September quarter this year. Base Resource’s current timeline has the Kwale Project in production in mid-2013. This is the same year that a supply shortfall for mineral sands is forecast, creating upward pressure on prices to motivate sufficient supply. Click here for more Shares to Buy Tips.
Best Shares Biota Holdings (BTA)
Biota Holdings (BTA) is an Australian based, anti-infective drug development company. The group specialises in the discovery and development of pharmaceuticals, focusing on research for the treatment of viral respiratory diseases, particularly influenza (flu). It was one of the shares to sell from mid-February following a disappointing half year result. However, BTA surged on Friday after it was awarded a US$231 million contract for the advanced development of its laninamivir drug. Laninamivir is an influenza antiviral, which offers the ability to treat an influenza infection. The contract will be fully funded over five years and is dependent on Biota Holdings achieving key milestones throughout the period. BTA rocketed over 35% following the announcement, making it the best performer in the Australian share market. For FREE Best Shares and Biota Holdings advice, click here.
Stocks to Watch Prima BioMed (PRR)
Prima BioMed (PRR) is a biotechnology company focused on cancer immunotherapy, which stimulates the body’s own immune system to attack tumours. Its lead product is the CVac ovarian cancer immune therapeutic or known as therapeutic cancer vaccine. CVac has completed two successful clinical trials and is progressing toward eventual commercialisation in the US, Australia, Europe, and globally. This product is a maintenance therapy for patients with ovarian cancer administered post surgery and post chemotherapy to delay relapse and control metastases. The company’s strategy is to commercialise CVac into the multi-billion dollar global oncology therapeutic market. PRR has other products in the development pipeline like the Oral HPV vaccine created using dense gas technology. PRR plans to list on the Nasdaq Global Market in the United States. Subject to approval, the company will have a dual listing of its securities on both the ASX and Nasdaq. PRR has also been one of the hot stocks recently, with its share price surging more than 50% in the past few weeks. Projects progressing CVac results from phase I and phase IIa trials have been very promising. It has also been evaluated for a registration study in breast cancer. The global market size for ovarian cancer is estimated to grow to US$3.6 billion in the near future. CVac would be the first of its type in the market and would and would initially aim to take a conservative 10%-25% of the ovarian cancer treatment market. A conservative 10% market share equates to approximately US$360 million per annum. CVac also has potential indications in several additional cancers. Trial for ovarian cancer patients in remission is planned to commence by third quarter 2011. Financials Being in infancy, PRR’s financial record is yet to gain traction. The company recently announced the appointment of Ian Bangs as its new CFO to bolster its financial affairs. For the half ended 31 December, PRR reported a marked increase in revenue to $0.51 million. The company also saw its net loss narrow to $6.9 million (from $7.9 million) on year. With PRR progressing rapidly to commercialisation of world’s first ovarian cancer vaccine, we feel this result will be turned around soon. PRR is well funded with $40 million committed for current work. Looking ahead PRR’s CVac addresses a major global unmet medical need. The company has top tier scientific advisors and project managers with a track record of successful commercialisation. Its long term goal is to develop commercial cancer treatment technologies and programs for global markets. Successful results will see Prima BioMed capture a significant share of the multibillion dollar cancer vaccine market. Trials indicate CVac is a strong candidate for treatment of ovarian cancer patients in remission. Success will provide considerable investment return over the next 2 to 3 years therefore PRR will be one of the stocks to watch. For futher FREE stocks to watch and Prima BioMed advice, click here.
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Nov 2014 - Nov 2016
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DISCLAIMER: *Performance is derived from recommendations provided by Australian Stock Report’s Trading Report, opened on or after date of acquisition in Nov 2014 *Return figures are gross returns and do not take into account fees or brokerage costs. *Returns are calculated based on a $50,000 hypothetical portfolio, risking 2% of the overall portfolio balance ($1,000) as a starting point for each trade. *Due to slippage and gapping, losses can sometimes exceed $1,000 on an individual trade. *Opening and closing prices for trades (and therefore the prices used for determining aggregate profit/loss) will be those published on the Australian Stock Report website and will be determined by the price at which they could realistically be executed in the market at the time the recommendation is published. *ASX 200 Accumulation Index Return is calculated based upon the price of the index at the start of the session on the day the first ASX 200 trade was placed, i.e. 24.11.2015
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