Thursday, January 12, 2012

Guyana Goldfields

Hey, I dunno... I sold half my $7.92 GUY yesterday for $8.35... then they come out with news today that seems to suggest to me that they've revised the timeline for their Feasibility Study, or something, I dunno, don't follow it too much, so the stock pukes back down to $7.49 or so.

So, now I've broken my own rule yet again... instead of selling the rest of my GUY at cost or so, I've bought back yesterday's sold shares, and then some, for another $7.50 or so.

I'd interpret this as me saying "yes, GUY has puked below its EMA(8), but it did so only because people are teh morans". I mean really... is this the first time you've seen a deadline pushed back, guys?

It'll be worth more than $7.45 in a month or two. They apparently are going to mine gold, or something like that, and apparently gold is all the rage with the kids of today, like iPods or something. Plus I'm guessing there's still some other minor news coming. Basically, a 10% sidestep on bullshit non-harmful news is a buy, for me.

Maybe I'm wrong though and GUY is now worthless. Maybe I should just blindly follow my EMA(8) program for generating buy and sell signals. Like it says in my blog's kicker above, anarchist sociopath, dystopian future, wardroids and piles of human skulls, and so on.
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2 comments:

  1. Scotia blurb today re: GUY fwiw.

    Event
    Guyana provided an update on its Aurora gold project feasibility study,
    now expected in a few weeks. We have incorporated information from
    the latest corporate presentation as well.
    Implications
    We noted that capital cost ranges have increased in the company's
    marketing slides from Guyana's website and this is the biggest change
    to our model. We now assume initial capital costs of $840 million for
    the construction of the open pit and underground operations.
    Open pit mining is still expected in 2014, but underground production is
    now starting in 2019; we had thought 2018 previously.
    We raised our total cash cost forecast to $625/oz inclusive of the 8%
    royalty ($102/oz on average) from $592/oz.
    We incorporate a $120 million equity financing at $8.00 per share (up
    from $6.00) in our net asset valuation (NAV3%). This is 17% dilution.
    The result of our changes is a new NAV3% of $11.62 per share down
    13% from $13.34. Accordingly, our one-year target price is reduced to
    $13.00 from $15.00 per share.
    Recommendation
    We continue to rate Guyana 1-Sector Outperform.

    ReplyDelete

  2. I dunno if it can only be Scotia that tanked the price. Maybe it's just there was a bit of selling, so the momos who jumped on over the past week dumped when they saw the weakness?

    Everyone knows capital costs are going up. Also, the marketing slides have been available for a few days.

    U/g production setting back a year hardly affects the DCF NPV, I think. And their equity financing is now at a higher assumed share price, meaning less dilution, yet their target drops?

    I think the real, unstated reason they have for the target drop is more along the lines of "the $HUI is down and gold is down".

    Anyway, thanks for the data though.

    ReplyDelete

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