BSG - Bolnisi Gold

[Out Too Soon]

Hi Kennas, I suppose you were way to busy at the cantinas on those beautiful beaches to go visit Bolnisi. (You could have claimed your trip as an expense!!)
Hope you had fun anyway, I'll have to check your Blog again.

 

[Sean K]

Hi Kennas, I suppose you were way to busy at the cantinas on those beautiful beaches to go visit Bolnisi. (You could have claimed your trip as an expense!!)
Hope you had fun anyway, I'll have to check your Blog again.

I could still probably claim it, but I went on FF points anyway. Just had to pay the taxes....Great trip. Will certainly be back again.

 

[Rafa]

from DJ News

1151 [Dow Jones] Bolnisi Gold (BSG.AU) up 6.8% at A$3.14, hits 2-month high of A$3.16 amid strength in gold prices and takeover speculation on Lihir Gold (LHG.AU). Merril Lynch and Tolhurst recently reiterated buy recommendations, with price targets of A$3.75 and A$4.00 respectively. Chart shows near perfect bull flag pattern with conservative target of A$3.25, aggressive target of A$3.40. Resistance A$3.15. Support A$3.03. (DWR)


Kennas, does any of this make sense...?

 

[Sean K]

from DJ News

1151 [Dow Jones] Bolnisi Gold (BSG.AU) up 6.8% at A$3.14, hits 2-month high of A$3.16 amid strength in gold prices and takeover speculation on Lihir Gold (LHG.AU). Merril Lynch and Tolhurst recently reiterated buy recommendations, with price targets of A$3.75 and A$4.00 respectively. Chart shows near perfect bull flag pattern with conservative target of A$3.25, aggressive target of A$3.40. Resistance A$3.15. Support A$3.03. (DWR)

Kennas, does any of this make sense...?

It's poorly worded isn't it.

Price target:
BSG $3.75
LHG $4.00

I don't know how they've plucked those. Pretty sketchy extentions of the rapid rises to consolidation. Works better for LHG than BSG. Odd.

The last sentance is about BSG I think. There will be some resistance at $3.15 and then all time $3.25 ish. Support may be established at $3.00 ish, but I thought that last time it went through in Nov 06. It failed obviously. $3 needs to be tested and proved to be validated.

 

[Rafa]

Shot thru 3.15 with ease...
Now for the all time high close of 3.34, and the all time intraday high of 3.43....

 

[Rafa]

Holding 3.15 so far...
This may need to turn into a solid base in the next few days before it can continue on.

 

[Sean K]

Bolnisi Looks Attractive
FN Arena News - March 01 2007

By Greg Peel

While projects may be scarce in Australia, Australian (and Canadian) listed gold and silver miner Bolnisi Gold (BSG) is sitting on significant reserves in Mexico – specifically at Palmarejo in Chihuahua, but also in other sites. First production at the 74% owned Palermejo site is expected in early 2008.

Bolnisi has underperformed precious metal prices in the recent run-up which analysts at Shaw Stockbroking attribute to Palermejo being only in the construction phase. "However, we believe that the resource base will continue to grow with a resource upgrade expected around mid-2007".

There is also interest in Bolnisi's Guadalupe mine from both Shaw and Merrill Lynch (being the only broker in the FNArena database to cover the stock).

Shaw notes geological indicators at Guadalupe suggest drilling to date has only tested the upper levels of the mineralised system. This strongly indicates Guadalupe has the potential to grow considerably with deeper drilling which is currently under way. A resource in excess of 1Moz is "quite likely", says Shaw.

Bolnisi reported a loss yesterday, as was expected of a company pursuing development. While Merrill Lynch pared back their FY08 profit forecast by 14% due to higher costs, the analysts note that at 1.4x NPV Bolnisi is cheap compared to US peers at 2.0x or more.

Merrills expects earnings growth to be significant in the coming years with further upside provided by exploration. While Bolnisi may need more funds down the track the company is virtually debt free.

Merrills rates the company as a Buy (high risk) with a target of $3.75. It closed today at $2.83. Merrills also notes Bolnisi's "strong corporate appeal".

And this is probably the real driver of Bolnisi's value. A quality asset such as Palmerejo in a stable country like Mexico is like…well…gold. With very few significant projects left in the world, gold miners are scrambling to acquire anything to secure future growth.

Shaw notes that "history has shown that large medium/high grade precious metal projects are usually taken over by the global majors". As a comparison, Shaw refers to the takeovers of Plutonic Resources and Normandy NFM at A$1.2 billion and A$1.4 billion. Their reserves were of similar grade and size as Bolnisi, and those takeovers occurred when gold was half the price it is now and silver one third.

Yet Bolnisi's current enterprise value is A$857m and Shaw is only attributing A$1.2 billion as a valuation which it suggests "looks quite conservative". Shaw rates Bolnisi as a Buy (L/T Outperform) with a target of $4.00.

 

[Rafa]

makes for good reading...
i quite like this stock, but i think patience may be the key... espcially after the 'global' events of the last few days

 

[Out Too Soon]

makes for good reading...
i quite like this stock, but i think patience may be the key... espcially after the 'global' events of the last few days

Must admit to taking profits at 3.24 but got back in yesty morn, wish I'd waited a little longer now. What gos round comes round though. The main thing is I'm back in for when the gold & silver starts to flow.

 

[Out Too Soon]

Anyone know why Bolnisi has been hit so hard? Doesn't make sense to me, I'm thinking of putting my last few pennies into BSG at this sp, is there something I missed?

 

[Rafa]

yeah, been thinking the same thing,
but everywhere i look, i can't seem to find a reason...

maybe cause its not a producer yet...

 

[Sean K]

I sold out on what I thought was the market dead cat 2 days ago. Sold just about everything actually. Waiting for some direction now.

 

[Freeballinginawetsuit]

Anyone know why Bolnisi has been hit so hard? Doesn't make sense to me, I'm thinking of putting my last few pennies into BSG at this sp, is there something I missed?

I got taken up at $2.66 today OTS, lets see what pans out.....BSG is a great gold play IMO and a fast mover amongst the goldies when it gets up a bit of momentum!.
Seems to have found a bit of support around $2.60 ish this time around

 

[Out Too Soon]

Well I'm still holding but I'm down almost 10% , I can't see why it's been punished, I just glanced through the half yearly report - 31 pages ASX release on 28th & all looks very exciting, nearly ready to start, no hidden nasties that I can find. Seems ridiculous when a glowing report sent the sp up to 3.25 just over a week ago. Just watching now I think I'll have to get some more.

Ours is not to reason why, ours is just to invest & profit!

 

[Freeballinginawetsuit]

Thats not a bad position taken up by a BSG Director off market.......1.3 mil>500,000 shares@ approx $2.60 SP!.

 

[Out Too Soon]

Thats not a bad position taken up by a BSG Director off market.......1.3 mil>500,000 shares@ approx $2.60 SP!.

SHHH!

 

[Rafa]

yeah, this could be one of the hidden gems...
macquarie is in too...

i'm down 10% as well, but i am holding,
should really increase my stake, but i am not sure on this market at the moment...

they say falls come in three's so maybe there is another fall to come...
and then i can add at a lower price, but i think your right in that there is some support at 2.60!

 

[Jadefox]

Anyone know why Bolnisi has been hit so hard? Doesn't make sense to me, I'm thinking of putting my last few pennies into BSG at this sp, is there something I missed?

Perhaps it's due to the failure of gold and silver to break higher/subsequent decline - sentiment damaged and PM's expected to remain weak for a while.
Just my 2 cents.

 

[Out Too Soon]

Not fair that a bloke with a million laying around spare can grab it 10c cheaper than me but anyway, that's the haves & have nots.
Just bought my biggest parcel of anything ever $8k, wish me luck or the wife will kill me. .

 

[Sean K]

Just bought my biggest parcel of anything ever $8k, wish me luck or the wife will kill me. .

Good luck OTS! Medium to long term it's a good stock. You still might get some short term volatility, but concensus seems to be that gold is heading further north.