AMI - Aurelia Metals

[Zaxon]

Does a CEO exit warrant a 18% drop in the stock ? I am confused ! All comments / discussions appreciated. I hold the AMI stock and trying to work out whether to hold or fold...

It could be assumed by the wording of the announcement that he was forced out, or at the least, an irreconcilable difference happened between the CEO and the board. So you're now left with a company that has disarray at the top.

Jim Simpson to an extent, had a "cult of personality". A lot of shareholders held him in very high regard. Consider if Elon Musk left Tesla, what would happen to the share price? JS leaving AMI is a softer version of that.

Because of the way this was done, a lot of AMI shareholders are very angry. They feel blindsided. There was never a hint that JS wouldn't be the CEO of AMI for years to come.

Personally, when I saw the announcement at 8:54 this morning I put a sell order in straight away. Yesterday AMI closed at 74.5. I sold out on opening at 65c. The stock is now 61c.

So what's my assessment of AMI? It's possibly a good hold for the long term. They have good mining assets, and are reasonably profitability. I think a lot of fundamental investors will stick with the stock despite JS leaving. In the short term, however, sentiment has left his stock. The stock probably won't return to previous highs for some time.

For me the question became: are there better places that my money can be growing where management isn't in disarray?

 

[aus_trader]

It could be assumed by the wording of the announcement that he was forced out, or at the least, an irreconcilable difference happened between the CEO and the board. So you're now left with a company that has disarray at the top.

Jim Simpson to an extent, had a "cult of personality". A lot of shareholders held him in very high regard. Consider if Elon Musk left Tesla, what would happen to the share price? JS leaving AMI is a softer version of that.

Because of the way this was done, a lot of AMI shareholders are very angry. They feel blindsided. There was never a hint that JS wouldn't be the CEO of AMI for years to come.

Personally, when I saw the announcement at 8:54 this morning I put a sell order in straight away. Yesterday AMI closed at 74.5. I sold out on opening at 65c. The stock is now 61c.

So what's my assessment of AMI? It's possibly a good hold for the long term. They have good mining assets, and are reasonably profitability. I think a lot of fundamental investors will stick with the stock despite JS leaving. In the short term, however, sentiment has left his stock. The stock probably won't return to previous highs for some time.

For me the question became: are there better places that my money can be growing where management isn't in disarray?

Somethings to consider... As you said looks like there was a lot of angry shareholders who took it out on the stock itself by dumping it. Hopefully the anger has dissipated today with this massive slide and all the angry birds have exited the stock. Let's see what happens tomorrow...

 

[Miner]

Somethings to consider... As you said looks like there was a lot of angry shareholders who took it out on the stock itself by dumping it. Hopefully the anger has dissipated today with this massive slide and all the angry birds have exited the stock. Let's see what happens tomorrow...

Looking from left field, could JS actually found /did something alarming which market will feel in a couple of months. Remember Aus Drill issue - theft of $10 M by an employee? A person with a status of Elton Musk does not leave or create the situation to leave overnight - there must be something more there. Either way, if there is no material breach (who knows), then currently AMI creates an opportunity. What do the charts say?
DNH - luckily withdraw as I put a buy order at 71 cents couple of days back and cancelled that just by hunch.

 

[peter2]

All trends come to an end. AMI has had a great run. If you look at the top panel of the weekly chart AMI started going up faster than the XAO in Dec18. It continued to do this until March19. We don't know why people sold and stopped this run. It could be due to natural reasons. Businesses need time to complete projects. Investors need to wait for progress reports to feel comfortable paying more.

Clearly a sudden change in leader (CEO) that's been responsible for the past performance isn't good. AMI started to be sold off one month before this news. Insiders know what's happening within every company and rumours are hard to stop. We may find out in the future if anything is amiss. Chart traders, seeing all the down bars have had the opportunity to reduce their downside exposure without waiting for the reason. Right now the chart is ugly. Sellers are still in control.

 

[Zaxon]

All trends come to an end. AMI has had a great run. If you look at the top panel of the weekly chart AMI started going up faster than the XAO in Dec18. It continued to do this until March19.

Yes, it was a wonderful stock to own.

Clearly a sudden change in leader (CEO) that's been responsible for the past performance isn't good. AMI started to be sold off one month before this news. Insiders know what's happening within every company and rumours are hard to stop.

This is precisely what happened. As shareholders, we knew insider info was being leaked, but not given to the market. Some even knew who the leaker was. Shareholders had become very unhappy during the last month, and felt continuous disclosure rules weren't being followed.

This is precisely why when the news finally did come through, I sold. It felt like dating someone who had been lying to you.

 

[aus_trader]

This is precisely why when the news finally did come through, I sold. It felt like dating someone who had been lying to you.

Agree with all of you. You've been spared Miner !
I knew I was buying into a stock that was having some downward force (selling), but there seemed to be some short term reversal signs and perhaps stock finding some support. Either way as per your comment above Zaxon, I feel cheated too !

 

[peter2]

There's been no additional explanation for the leadership transition released to the market. However the daily chart indicates that a bottom may be in place. There's an acceptable RR (for me) reversal setup on the daily chart. I would prefer to see the POG rising as well.

 

[aus_trader]

Interesting how it had a down day today because I thought it would have followed through after the gap-up day yesterday with a bullish finish.

I believe HL-HH setup would have more weight to a reversal to the strong down-trend than a V-shaped reversal.

 

[peter2]

Fancy investor presentation released on the 12/6/19. Investors aren't buying what the CEO is trying to sell. AMI continues to be one of the unloved "dogs" of the ASX.

 

[aus_trader]

Fancy investor presentation released on the 12/6/19. Investors aren't buying what the CEO is trying to sell. AMI continues to be one of the unloved "dogs" of the ASX.

View attachment 95427

I've been a fan of AMI, but have to Agree on your view. There must be something tainted that they are not telling us (reporting) about. As you said, the rosy picture they paint (which looks sexy for someone who looks at the fundamentals) is not reflected in the price. AMI is going against the grain while most of it's Gold mining peers are going the other way e.g. SAR, SLR, PRU and even the leader of the pack NCM who broke to the upside after 3 years of sideways grind.

 

[frugal.rock]

Am surprised this one hasn't had much attention for 6 months.
Another stock that popped up on my radar yesterday. I didn't buy.
That's all I can say apart from Van Eck group became a substantial holder on Friday for a 5% stake...
Was going to cull ARQ from the yearly comp to change to this one.
But decided to stick with my convictions. Cheers.
F.Rock
PS, did anything else come of the Director leaving as mentioned in above posts?

 

[Clansman]

I have a watch on it for an entry point as it could be shaping as a cheap takeover target in the coming year.

 

[rederob]

Looking to buy a gold equity this week?
AMI has just spent millions upgrading plant and will be operating at nameplate by end FY.
In the current half AMI will produce about 50koz of gold at an AISC under AUD$1000/oz.
Of these 50koz, some 18koz will be sold into hedges at $1911. That leaves about 30koz selling into the market at over $2400 (presently spot being $2480). It appears AMI has no not hedged gold output beyond FY 2020, so they will thereafter be fully exposed to gold's upside.
In FY2021 AMI hopes to target some gold output from its high margin Kairos (aka Peak Deeps) decline, eg. 16m at 71.6g/t Au & 8.5% Pb+Zn.
Last October AMI paid out a ff dividend of 2cps. That payment reflected approximately 50% of net profit and net cash generation in FY2019. While AMI has made no commitment to a 2020 dividend, the amount needed to match last year's 2cps is found wholly in gold sales which will no longer be hedged.
More importantly, AMI's major spend on plant upgrade is behind them, so going forward they will be processing a lot more ore a lot more profitably.
Note that AMI is a polymetallic producer and that changes to base metal prices can significantly affect its profitability.
The downsides to AMI relate to water costs for their Hera mine, and the company's mineral assets which will see them through the next 4 years but not much more until they can show conversions of exploration success.
The upside to AMI is the mineral region it operates in which has already shown some good results.

 

[rederob]

Sorry about a bad link above.
It's this one for the pdf file of good results.
Or read all their recent announcements here.

 

[rederob]

After Monday's stellar price rise on the back of a surge in the gold price I expect a few cents to fall off its share price today after POG dipped back to levels similar to last Friday's close.
I already hold AMI but did put in an unfilled order on Monday for more, and today will drop the bid to 43 cents.
Below is the recent price action of gold explaining the rationale of my bid.

 

[finicky]

Hmm, big announcement today and AMI barely down compared with most of the pure gold stocks.

I have to say with my primitive charting prowess that it's not a monthly chart that I would be comfortable buying yet - if I knew nothing about the company (instead of almost nothing) I would look at that chart and see a possibility of gfc lows around 10c. Not to be too silly, not predicting a stark fall like that for AMI, but just the low level of comfort I feel towards the naked chart. A thick line through 40c, going back years, shows it's a significant level of resistance/support to have been broken I think.
Against this we know the Peak ops and prospects have Gold and AMI should now be able to process it better. Ahead, that stunning drilling intercept from recently discovered Kairos prospect is promising . But in favour of the dodgy chart thus far is the question can management be trusted for full disclosure - as this thread has discussed. Also, currently, zinc and lead aren't too enticing right now are they?

Certainly be watching it, but have to mind my cash carefully through this period. My own plan is to preserve limited cash but cash up some gold stocks and PMs to exchange for a list of tech, finance, industrial stocks if /when the goldies pay off.

Disc: Not Held
Sentiment: Watch

COMMISSIONING OF PEAK PLANT UPGRADE COMPLETED
KEY POINTS:
• The $53M upgrade of the Peak ore processing circuit has been commissioned on
time and in-line with guidance.
• The upgraded plant is fully operational with the processing of high grade Chronos
Pb-Zn ore commencing in February 2020 and final project completion activities and
process optimisation to take place over coming months.
• With gold being the Company’s main revenue driver, contributing some 65% of
group revenue, the milestone allows for the maximisation of by-product revenue
and the lifting of overall throughput.

AMI All Data Monthly

 

[peter2]

AMI reports further good Pb-Zn drill results.

It's almost a valid 1st BB reversal setup (volume still low but day not over).

 

[rederob]

A great exploration update was issued by AMI today.
AMI had been floundering after the COV19 meltdown, but when it earlier in the week announced it had a minimal effect on production its price began to ramp up.

 

[rnr]

One could easily arrive at the conclusion that I am looking for shares that are in a similar state (trade wise) as my previous post in WAF.
The common denominator is that I am looking for securities that, to me, are looking to break to the upside.
Whilst there has recently been a bullish 5 wave higher we are now looking at a lower 3 wave (a-b-c) unfolding before prices start to move higher again.
To this end we have a lower wave a and higher wave b in place and a target price for a wave c at approximately $0.38.
Once again I get the impression that price is ready to move higher before moving as low as $0.38!
WE can only wait and see what happens from here.

[N.B. This is not a recommendation and I do not hold.]

 

[Chronos-Plutus]

View attachment 104943

One could easily arrive at the conclusion that I am looking for shares that are in a similar state (trade wise) as my previous post in WAF.
The common denominator is that I am looking for securities that, to me, are looking to break to the upside.
Whilst there has recently been a bullish 5 wave higher we are now looking at a lower 3 wave (a-b-c) unfolding before prices start to move higher again.
To this end we have a lower wave a and higher wave b in place and a target price for a wave c at approximately $0.38.
Once again I get the impression that price is ready to move higher before moving as low as $0.38!
WE can only wait and see what happens from here.

[N.B. This is not a recommendation and I do not hold.]

Recently I sold my holdings in AMI @ 44cents. I had bought in @ 35 cents. 25% return in a month or so, not bad.