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S32 - South32 Limited

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I've had S32 in my portfolio previously. Stayed out as the volatility increased at the start of the year. But looks like it's settling down again and starting to behave like it's old trending self...

Thanks for pointing out the technical picture of S32 guys, I'll be watching it with interest as to where it's heading.
 
Thanks for the TA all. This one came onto my radar this reporting season but I have not considered it yet. Glad to see the TA is positive.
 
Since my last comments price has fallen from the top of the range to the bottom. The daily chart is presenting a promising opportunity as price bounces off support (3.00). The RR is acceptable if price goes back to the old highs above 4.00. If price closes below 3.00 I'm not interested.

s321712.PNG
 
fwiw I'm getting more tempted by S32 which closed on its intraday low today.
I already hold 8,000, mostly from the BHP spin-off but am thinking of nibbling here.
The price has already met my crude measured target from the rounding top with a 'neckline' at $3
I like the (very) long term prospects of Hermosa and also the Trilogy jv. Meanwhile S32 is a cash positive big company in difficult times.
South Africa thermal coal is a downer and also I gather there are problems with S32's Manganese assets but S32 is trading well below book value and I see it as worth ~2x book value. Admittedly it's a mystery to me as to why it's trading so low, so maybe I am underestimating its problems - but long term I tend not to think so.
So anyway, I should be getting a few more if it dips towards 1.50. Depends a bit on other opportunities competing for my limited cash.

S32 4 Year Wkly
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I entered S32 today after the pullback signal on the 25/5 and funds coming available so paid a few cents more than the original signal but will watch to if we can break the $2.02 mark and run up to +$2.15.

upload_2020-5-28_19-20-47.png
 
finicky said:
fwiw I'm getting more tempted by S32 which closed on its intraday low today.
I already hold 8,000, mostly from the BHP spin-off but am thinking of nibbling here.
The price has already met my crude measured target from the rounding top with a 'neckline' at $3
I like the (very) long term prospects of Hermosa and also the Trilogy jv. Meanwhile S32 is a cash positive big company in difficult times.
South Africa thermal coal is a downer and also I gather there are problems with S32's Manganese assets but S32 is trading well below book value and I see it as worth ~2x book value. Admittedly it's a mystery to me as to why it's trading so low, so maybe I am underestimating its problems - but long term I tend not to think so.
So anyway, I should be getting a few more if it dips towards 1.50. Depends a bit on other opportunities competing for my limited cash.

S32 4 Year Wkly
View attachment 103197
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S 32 is having some structural problem with management structure right from mid level up.
Decision makings are poor. Good people have left. It is running on momentum. Short term success but long term disaster. I met few ex South 32 guys who remained from BHP and got disillusioned and rejoined BHP.
Unfortunately though hold having bought a low price with a net positive.
 
Yes I've changed my mind about S32. Partly because I will be trying to build up some cash after fy20 ends - will be selling stocks in July/Aug, but not S32 at these prices. I believe there'll be another market crash. When I do start buying again, S32 is not high on my wishlist, maybe later for Hermosa in a silver bull market. Thanks for the inside goss.
 
S32 gapped down on Friday to finish at $2.10 so I will be watching to see if it tests support @ $2.02 and then possibly re-enter for another trade as it was looking surprisingly strong having reached a high of $2.34 on the 9/6.
 
The main reason I do look to South32 for a long term investment is its stellar development path: the Hermosa project in Arizona and its 50/50 jv with Trilogy metals in the Ambler project, Alaska. No cash will flow from either for maybe another 4-5 years but obviously the market will start to account for this well beforehand - and what commodity prices, including Au, Ag, will it be figuring in by then?

Hermosa in Arizona has two deposits, Taylor and Clark, which are still being drilled out but the resources so far are great, especially if you're a silver bug - there's over 400 million ozs of silver resource:

Taylor deposit, from S32 website:

The Taylor deposit is a greenfield development option that has a reported resource of 155 million tonnes, averaging 3.39% zinc, 3.67% lead and 69 g/t silver. The resource remains open at depth and laterally, with multiple targets to be tested as we continue our extensive surface drilling program.

Clark deposit, 12 May 2020 ann:

"South32 is pleased to report for the first time a Mineral Resource estimate for the Clark Deposit which forms part of its 100% owned Hermosa project located in Arizona, USA

The Clark Mineral Resource estimate is reported in accordance with the JORC Code (2012) at 55 million tonnes, averaging 2.31% zinc (Zn), 9.08% manganese (Mn) and 78g/t silver (Ag)."

The Ambler jv in Alaska also has two deposits: Arctic and Bornite.

Arctic deposit:

The main mineral here is copper but jv partner, Trilogy, has a pre-feas out for Arctic that is saying that all in costs (including credits for other metals) should be US 98c/lb of payable Copper. But get this, they are factoring in only US $1300/oz for gold and $18/oz for silver over the project's lifetime.

From the recent Arctic pre-feas:
"Average annual payable production projected to be more than 155 million pounds of copper, 192 million pounds of zinc, 32 million pounds of lead, 32,000 ounces of gold and 3.4 million ounces of silver for life of mine" - 12 years LOM.

Arctic Deposit

trilogymetals.com trilogymetals.com

Bornite deposit, from jv Partner Trilogy's presentation:

Copper 6 billion lbs, Cobalt 77 million lbs
Screenshot_20201018-132731_Drive.jpg
 
The big miners' dash for more climate-friendly commodities will make it harder for mid-tier miners to muscle their way into deals or snap up assets, South32 CEO Graham Kerr has warned.
"We all like those commodities that are more green-facing, that actually have more application in that energy transformation - which means there’s greater degrees of competition," Mr Kerr told a conference in London. In emerging markets, South32 would be competing for those projects, assets or companies against China. And in developed countries, "you’re probably competing against some of the bigger miners who probably have their bigger balance sheet and are inclined to spend more money".
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Mr Kerr said the company was coming to the end of its first five-year plan to reduce carbon emissions and was now "in the next phase of thinking about our next carbon targets and climate change action plan", which would include scope 3 (downstream emissions by customers or clients). The push to be more carbon-conscious was "getting more intense, but there is no substitution for metallurgical coal today in the steelmaking process". Still, a scope 3 emission-reduction plan should in theory mean working with steelmakers to wean them off coking coal.
"We’re 3 per cent of the metallurgical coal market, so our ability to actually influence steelmakers is probably not as large as some of our competitors ... who are very big producers," Mr Kerr said. "But ... I think we can continue to work in some of the different associations and with some of the customer groups about investing in some of the technology that we think will help with scope 3 emissions as well."
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WOWEE , really quiet on this thread

( i hold S32 )

any views on S32 today since the quarterly is out today

am only started glancing at it but so far so good
and with many commodity prices higher than usual is this part of the mining cycle

take care this is a crazy volatile market

DYOR
 
JohnDe said:
I came to the party late but very happy so far :)

From my readings, the next year is going to be mostly positive.

Anyone have any other news?

View attachment 134722
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Enjoy the team collaboration at ASF and Merry Christmas @JohnDe .
I am cautiously optimistic for 2022. Corona is a gamble.
I am now 60 pc cash today from 38 pc cash . Could be a fatal error . Time will tell me in 2022.
 

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