Michael Gable, Fairmont Equities
Western Areas (WSA)
We expect strong support for WSA shares around current levels and believe it’s time to buy back in. Also, nickel prices remain well supported. If the stock can breach $4, then we would be looking for levels back up between $4.50 and $5. The shares closed at $3.38 on May 31.
Mayne Pharma Group (MYX)
A speculative buy, in our view, as this pharmaceutical company has previously disappointed us several times. However, it looks like a low is in place on the chart. Recent price action has been bullish and MYX looks ready to jump higher from these low levels. The shares finished at 77.5 cents on May 31.
ANZ Bank (ANZ)
During the past several weeks, ANZ, in our view, has looked the strongest of the big four banks. ANZ has bounced off several key technical levels and we’re confident a low is in place. It now appears ready to trade higher again. The shares closed at $27.21 on May 31.
Origin Energy (ORG)
Shares continue to trend well and we don’t see any signs this uptrend will soon end. If investors can tolerate the recent share price swings and hold on, then we expect ORG to head towards a key resistance level near $11.50. The shares finished at $9.60 on May 31.
Caltex Australia (CTX)
CTX peaked this year at more than $36, but the selling since then has been brutal. Based on this price action, we would expect further downside back towards support near $27. The stock closed at $29.42 on May 31.
The shares are back to levels last seen five years ago. In that time, the company has experienced stiffer competition, and this technical level will offer strong resistance. In our view, the share price is likely to head south from here. The stock closed at $45.56 on May 31.
Simon Herrmann, wise-owl.com
BUY RECOMMENDATIONS Sun Resources NL (SUR)
In our view, the recent re-capitalisation, the joint acquisition of the Bowsprit Oil Project in the Gulf of Mexico and appointment of CEO Alex Parks are set to drive a revival at this oil and gas explorer. Drilling later this year is aimed at converting existing resources to reserves ahead of a field development at Bowsprit. The company has an immediate funding demand, which is weighing on the stock and may impact near term performance. Our valuation of 1.2 cents a share represents a significant price premium, so warrants a speculative buy recommendation. The shares finished at less than a cent on May 31. InvoCare (IVC)
Following a strong rally to an all time high in late 2017, a major pullback followed an earnings downgrade in early May. We acknowledge a volatile share price, but believe the current level represents a suitable entry point for this defensive stock. Our fundamental view remains largely unchanged and we retain our buy recommendation on this funeral operator. The shares finished at $13.20 on May 31. HOLD RECOMMENDATIONS Invitrocue (IVQ)
Invitrocue is a health care company focused on bioanalytics. The company has developed proprietary technology called Onco-PDO. It’s a personalised cell-based scaffolding technology that gathers patient-specific cancer information to guide oncologists in drug and therapy selection. Invitrocue has treated its first customers in Asia. Recently securing grant funding from Northern Ireland is validation of its intellectual property. If Invitrocue achieves key milestones, strategic interest may build up. Frontier Diamonds (FDX)
This diamond producer has a portfolio of revenue generating mines in South Africa. The company has invested heavily in refurbishing and upgrading its mine infrastructure and recently reaffirmed its prospectus guidance to deliver a maiden profit in fiscal year 2019. The Star and Sedibeng mines are on track to run at full capacity in the second half of calendar 2018, as sub level retreat mining techniques drive greater throughput at increased grades. Funding is currently being addressed and we’re watching Frontier for its turnaround potential. SELL RECOMMENDATIONS Ainsworth Game Technology (AGI)
The gaming company is in a long term downtrend and the recent earnings downgrade triggered a sharp sell-off. Stiffer competition and a tougher regulatory landscape have adversely impacted the company’s bottom line.
Oliver’s Real Food (OLI)
Since listing on the ASX in June 2017, this healthy fast food chain has downgraded earnings guidance several times. Some stores have failed to perform and delays in opening dates have impacted revenues. The company has a track record of missing its forecasts, so we prefer to invest our money elsewhere.
Gavin Wendt, MineLife
Orion Minerals (ORN)
Orion’s share price performance correlates with a significant advancement at its Prieska zinc-copper project in South Africa, including the release of a maiden mineral resource that’s exceeded expectations. There’s potential for a VMS (volcanogenic massive sulphide) body, and heightened anticipation surrounds the comprehensive bankable feasibility study that’s currently underway. Just recently, Independence Group (IGO) has increased its stake in Orion to 11.1 per cent as part of a collaborative working relationship in South Africa.
Sipa Resources (SRI)
Sipa has signed a landmark earn-in and joint venture agreement with Rio Tinto, which will see it acquire an interest in SRI’s Kitgum Pader base metals project in northern Uganda. Rio Tinto has the option to sole fund a three stage earn-in totalling up to $US57 million. The agreement encompasses Sipa’s entire Ugandan tenement package, forming a joint venture to explore, evaluate and, if feasible, develop one or more mines.
Highlands Pacific (HIG)
Highlands has always been a stock for the patient investor. That patience has been rewarded by the announcement of a $A15 million share placement and a $US113 million nickel and cobalt streaming agreement with Canadian battery metals company Cobalt 27 Capital Corp. The transactions represent a fundamental transformation for Highlands, which will emerge in a much stronger financial position, debt free and with enhanced access to cash flows from its Ramu nickel-cobalt mine in Papua New Guinea.
Vango Mining (VAN)
Vango is undertaking an extensive drilling program at its Plutonic Dome gold project in Western Australia. The plan is to expand the K2 resource base and the potential mine life of the proposed operation via targeted drilling programs. The programs are designed to expand the resource base, while simultaneously drilling to define and extend the high grade Trident gold deposit, with a view to stand alone underground mining and processing. The market has already responded to initial positive results.
Australian Vanadium (AVL)
The company is developing a vertically integrated VRFB (Vanadium Redox Flow Batteries) business. It’s built around AVL’s advanced Gabanintha deposit in Western Australia, comprising battery distribution, installation agreements and a proposed battery electrolyte production business. AVL’s previous tests have demonstrated excellent concentrate recovery, while providing defined inputs into the next phase of work. Investors might look to lock in some profits given the stock’s strong price run.
Gascoyne Resources (GCY)
A slow and steady performer over recent years, Gascoyne has methodically progressed towards first gold production at its Dalgaranga project in Western Australia. A further re-rating is possible once steady-state production is achieved. Project commissioning is almost complete, about six weeks ahead of schedule and under budget. The project boasts characteristics that have resulted in lower-than-normal capital and operating costs. Investors might look to lock in some profits given the stock’s strong price run.
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