SDL - Sundance Resources
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Jono, at 3.38pm there were 7,500,000 shares purchased at 15c in the space of 4 seconds. This equates to an outlay of $1,125,000.
No announcements!
I don’t think SDL has any announcement for the short term as the drilling result in Congo won’t be available till at least second half of 2010 as there are only to rigs on the ground.
Although the D bank will inform them the potential partners in late March or early April, I don’t think the short listed will be final, and they will probably conduct more due diligence…who knows how long it will take….
Really wish they can update/inform the market with more details on their timeline….Well….the only update due soon will be the quarterly update in April…hope there will be some encouraging news…
Btw, anyone aware the recent deal with DMM. DMM has target of 1b tons in Congo, but with a market cap only 20m ….is it make SDL over valued?
For SDL to move back into uptrend territory needs to have 0.175 trade and cannot go below 0.12
As it is now SDL is in retracement from recent 0.215 high
What put SDL on my radar, is that there was 61% retracement from 0.215 high and technically stock can go up.
Just in case have 0.135 stop should SDL go lower, I can always have another trade later.
As it is now SDL is in retracement from recent 0.215 high
What put SDL on my radar, is that there was 61% retracement from 0.215 high and technically stock can go up.
Just in case have 0.135 stop should SDL go lower, I can always have another trade later.
Don’t you think SDL will be mainly news driven? The 0.215 high was before the large capital raise. Now the share has been diluted by 1/3, the ex high of 0.125 should be equivalent to about 0.145-1.50 which is the current price.
I am not into the technical analysis, maybe I am wrong and the dilution shouldn’t be taken into consideration for this purpose. Hope u can explain.
Also, if they announcement a positive finance term and partners agreements, don’t you think the price will go up regardless of what trend it is currently at?
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G'day Bleach8
There was an announcement made yesterday. Well it was more of a presentation that SDL had made in Singapore. Not alot that we hadnt seen before or didnt already know.
They have been drilling since November, albeit they only started with one rig, however they now have the second up and running and the third should be just about up and running, if it isnt already. With three drill rigs soon to be up and running I am anticipating that we could start to see some results in the next couple of months.
Don Lewis has said that DB will make a reccomendation of strategic partners by about March / April, and that they intend to announce partners around June/July.
There was an announcement made yesterday. Well it was more of a presentation that SDL had made in Singapore. Not alot that we hadnt seen before or didnt already know.
They have been drilling since November, albeit they only started with one rig, however they now have the second up and running and the third should be just about up and running, if it isnt already. With three drill rigs soon to be up and running I am anticipating that we could start to see some results in the next couple of months.
Don Lewis has said that DB will make a reccomendation of strategic partners by about March / April, and that they intend to announce partners around June/July.
I thought there will only be two rigs in Congo, and one rig will remain in Cameroon. I could be wrong.
Wish they can spree the news evenly through the rest of the year, rather than compact all the good news(Hope so) within the second half.
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Correct Bleach, there will be two in Congo and one in Cameroon, however all 3 of them will be working towards proving up resources in order to reach the target.
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Interesting Deutsch Bank becoming a substantial shareholder. Their analysts must think it's a good thing.
Correct me if I'm wrong but it looks like they have been buying up small parcels since Nov last year and have managed to acquire 5% without pushing the price up past 15.5c
Correct me if I'm wrong but it looks like they have been buying up small parcels since Nov last year and have managed to acquire 5% without pushing the price up past 15.5c
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G'day Richomania.
It appears they started accumulating on the 26th of November 2009 with their most recent purchase on 25th of March.
During this time, they accumulated 135,600,969 shares. During this period there was a low of 12.5c and a high of 16.5c.
In saying that though, I am questioning the detailed list of transactions provided in the announcement, as things just don't seem to add up.
On the 11th of December, they claim to have accumulated about 20 million shares, however my records for the 11th of December only show a total volume of 6,447,863
It appears they started accumulating on the 26th of November 2009 with their most recent purchase on 25th of March.
During this time, they accumulated 135,600,969 shares. During this period there was a low of 12.5c and a high of 16.5c.
In saying that though, I am questioning the detailed list of transactions provided in the announcement, as things just don't seem to add up.
On the 11th of December, they claim to have accumulated about 20 million shares, however my records for the 11th of December only show a total volume of 6,447,863
oh well...as long as DB has 5% now ..i think its a positive sign ... DB knows more than we do for sure...
however, is it an issue of conflict of interest ?! or the 'china wall" thing makes it possible ?or it is ok as long as there is no big transaction before any major announcement? not so sure ....
but its postive i guess
also GBG announced this 70Billion offtake agreement ...they are going to produce 12mt to start with ..with potential up to 30mt pa...their maket cap is around 850m (they only own 50% of the project)
give me an impression that SDL should worth 1.2-1.5 b(for 50%) based on the production etc
If you take this deal (top) then 50% of Mbarga etc. should be worth around 1.5bn (SP 50c). I would have thought that makes SDL somewhat undervalued
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Facts are:
1. Experienced management personnel (who probably wish to retain their credibility) have been attracted.
2. Resource has been proven up to recognised standards.
3. SDL describe their project development as "advanced".
4. Resource is very substantial even by world standards ( I think in the top ten?).
5. Ther are two very large economies and some smaller ones that wish to bring the illusion of wealth to their citizens. Probably they will need steel to accomplish this. My own opinion is that demand will increase at an exponential rate. It is an opinion only and is not based on any official figures.
6. It is difficult to imagine a bank such as DB investing clients funds in SDL (especially after the Lehman Bros fiasco) if they think it is a lemon. After all, they can see SDL's situation from the point of view of both the company and potential investors/offtake partners.
Personally, I think there will be a lot of people who will "miss the boat" and will wonder why they thought that 15 cents was "too expensive". My personal feeling is that this phenomenon will occur before the end of 2010.
I am a long term holder of SDL and these are my own personal beliefs, not based on any other evidence than I have outlined here.
Having said all this, I think it will be possible to buy SDL shares in the 11 - 12 cent range (as many as you want!) in about the year 2043 when the mine is absolutely depleted of all resource. Even then, Lake Mbarga might be worth a little more.:bowser:
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Iron ore prices are seeing substantial rises and the Chinese want to boycott the big three. I assume therefore that they will be seriously looking for alternatives. What more could we SH's ask for?
Iron ore prices are seeing substantial rises and the Chinese want to boycott the big three. I assume therefore that they will be seriously looking for alternatives. What more could we SH's ask for?
big volumes pushed the price back down to 14.5 c again....waiting on the qurtarly activities update which is due at end of the month. I really hope they annoucnment something in May, or at least first half....
also the management needs to do some serious media marketing ....a number of discussion in major papers lately about potential iron ore players which didint mentain SDL at all ....
btw, the price drop to 14-14.5c, i will buy more
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Some interesting developments of late, all in SDL's favour:
- Deutsche Bank becomes a substaintial shareholder, either themselves or on behalf of a client.
- UBS becomes a substaintial shareholder, either themselves or on behalf of the same client of DB.
- Iron Ore Prices continue to head North
- China continue to fight against big 3 miners
- China to place a ban on the import of low quality Iron Ore
- Deutsche Bank becomes a substaintial shareholder, either themselves or on behalf of a client.
- UBS becomes a substaintial shareholder, either themselves or on behalf of the same client of DB.
- Iron Ore Prices continue to head North
- China continue to fight against big 3 miners
- China to place a ban on the import of low quality Iron Ore
Almost year ago I posted
How it looks now ??
1. Outstanding shares increased from 2.1 to 2.8 bln (35% up)
2. $ is weaker (from 1.2 -> 1.07 USD/AUD (10% down)
3. price for iron ore substantially increase (60% up)
And how looks calculation now ?
let assume 30 MT @ 137.75 FOB (162$-24.25$ see http://www.mbironoreindex.com/ )
=4132 mln$ /year
Pre production 3.3 bln$ -> c.a. 660 mln$/year cc
- 660 mln$ year capital cost
- 590 mln$ operation (19.65$/T)
- 295 mln$ amortyzator
------------------------------
1545 mln$ yearly
4132 mln$ (revenue)
-1545 mln$ (costs )
--------------------
2587 mln$ EBIT
now assume that we will have only 50%
2587 mln$ EBIT * 50% = 1293.5 mln$
from other hand 2.8 bln outstanding shares and options.
EPS = 1293mln$/2.8bln shares = .46$ -> PE ratio = 0.33
let assume in production PE retion in area 10 (think not to much)
it leads us to .15*10/0.33 = 4.55AUD price per share.
Taking into account that year ago I made mistake in calculation
(target price shall be 2.94AUD instead of 4.4AUD) current target 4.55AUD
look much, much better better.
Pls take into account that current calculation was done with assumption
that SDL will take only 50% of gain....
As result I'm still in.
In last year I substantially increase my position.
What about you ??
And I think lake of Mbarga in 2043 will be worth much more than .15AUD/share
Technical signals, in one day
1.Price Crosses Moving Average (200-week)
2.Commodity Channel Index
3.Momentum
4.MACD
and of course still.....big fundamental perspectives.
1. 2.45 Bln @32%
2. 0.30 Bln @64%
in price @75$ per 100% equivalent it is 77 bln$ resources.
let assume 30 mln T 100% equvalent @ 75 FOB
=2250 mln$ /year
Pre production 3.3 bln$ -> c.a. - 660 mln$ year capital cost
- 590 mln$ operation (19.65$/T)
- 295 mln$ amortyzator
------------------------------
705 mln$ yearly
75% = 529 mln$
from other hand 2.1 bln outstanding shares.
EPS = .25$ -> PE retio (in USD) = 0.68
let assume in production PE retion in area 10 (think not to much)
it leasd us to .25*10/(.68) = 3.67$ price per share (in USD).
3.67 * 1.2(echange rate) give us 4.4 AUD/share.
This is my target price
How it looks now ??
1. Outstanding shares increased from 2.1 to 2.8 bln (35% up)
2. $ is weaker (from 1.2 -> 1.07 USD/AUD (10% down)
3. price for iron ore substantially increase (60% up)
And how looks calculation now ?
let assume 30 MT @ 137.75 FOB (162$-24.25$ see http://www.mbironoreindex.com/ )
=4132 mln$ /year
Pre production 3.3 bln$ -> c.a. 660 mln$/year cc
- 660 mln$ year capital cost
- 590 mln$ operation (19.65$/T)
- 295 mln$ amortyzator
------------------------------
1545 mln$ yearly
4132 mln$ (revenue)
-1545 mln$ (costs )
--------------------
2587 mln$ EBIT
now assume that we will have only 50%
2587 mln$ EBIT * 50% = 1293.5 mln$
from other hand 2.8 bln outstanding shares and options.
EPS = 1293mln$/2.8bln shares = .46$ -> PE ratio = 0.33
let assume in production PE retion in area 10 (think not to much)
it leads us to .15*10/0.33 = 4.55AUD price per share.
Taking into account that year ago I made mistake in calculation
(target price shall be 2.94AUD instead of 4.4AUD) current target 4.55AUD
look much, much better better.
Pls take into account that current calculation was done with assumption
that SDL will take only 50% of gain....
As result I'm still in.
In last year I substantially increase my position.
What about you ??
And I think lake of Mbarga in 2043 will be worth much more than .15AUD/share
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Almost year ago I posted
How it looks now ??
1. Outstanding shares increased from 2.1 to 2.8 bln (35% up)
2. $ is weaker (from 1.2 -> 1.07 USD/AUD (10% down)
3. price for iron ore substantially increase (60% up)
And how looks calculation now ?
let assume 30 MT @ 137.75 FOB (162$-24.25$ see http://www.mbironoreindex.com/ )
=4132 mln$ /year
Pre production 3.3 bln$ -> c.a. 660 mln$/year cc
- 660 mln$ year capital cost
- 590 mln$ operation (19.65$/T)
- 295 mln$ amortyzator
------------------------------
1545 mln$ yearly
4132 mln$ (revenue)
-1545 mln$ (costs )
--------------------
2587 mln$ EBIT
now assume that we will have only 50%
2587 mln$ EBIT * 50% = 1293.5 mln$
from other hand 2.8 bln outstanding shares and options.
EPS = 1293mln$/2.8bln shares = .46$ -> PE ratio = 0.33
let assume in production PE retion in area 10 (think not to much)
it leads us to .15*10/0.33 = 4.55AUD price per share.
Taking into account that year ago I made mistake in calculation
(target price shall be 2.94AUD instead of 4.4AUD) current target 4.55AUD
look much, much better better.
Pls take into account that current calculation was done with assumption
that SDL will take only 50% of gain....
As result I'm still in.
In last year I substantially increase my position.
What about you ??
And I think lake of Mbarga in 2043 will be worth much more than .15AUD/share
Terrific analysis. Probably much better than we see in so called newsletter published by Hartley, UBS, Bell Potter or even Alan Kohler and company. I am not mentioning those Wise Owl, FAT, Intelligent Investor - as they to me are just surface scratcher.
Just one basic item probably you have missed out - all calculations of dollar value, iron prices are for mines producing today. SDL will not be able to start production 2013 and probably ramping up will take 12 months to attain name plate capacity. I am confident of 12 months if Worley Parsons is selected (My guess they will be) and as we could see how FMG took time in ramping up. My guess ( I am not good in doing maths like you did ) is in Africa ramping up time 12 months is fair and reasonable. We can predict the iron price but who knew the bubble of 2007 will burst
I am a holder and will hold until the situation tells me otherwise .
But I am trying to be rational than over optimistic.
Having said that current price is probably very reasonable compared to other iron ore would be producers. So DYOR.
I fully agree with you
Let me provide mix analyse (tell mi if you will have enough)
Let us calculate what would be theoretical price,
that will in future give us market price 0.15AUS.
.15/10 =.015EPS
.015*2.8Bln = 42mln * 2 = 84mln (EBIT)
EBIT = 84mln
+ COSTS = 1545mln
------------------
= Revenue = 1587mln
Revenue / production = 1584mln/30mln = 52.9 USD/mT
in this case as bubble explode cost of fracht will sink foom 24.2 to 20 (?)
Than we will have FOB CHINA 52.2+20 = 72.2 USD (and this price was last time in 2005 )
The price for Fines ore was in average:
2006 - 76.2
2007 - 83.4
2008 - 132 to 90
2009 - 68 to 110
2010 - ???
So there is chance that .15$/ share is to high (ore price should by lowet then 72.2USD/MT)
In my calculation there is position 660mln capex repaied.
I assume 3.3blm in 5 years (sorry was to lazy to include interest rate discount)
In consquence after repaying that bottom line for ore price would be
EBIT = 84mln$
+ COSTE = 1545mäl$
-CAPEX = -660mln$
----------------------------
= revenue 969mln$
969mln$/30mlnMT = 32.3$/MT + 20$ fracht = 52.3$/MT CIF China
Such price we recentyl saw in 2004
How it will look for last lower price (03.2009 - 68$) ?
68$ - 20$ fracht = 48$ FOB Africa
Revenue = 1440mln$ (48$*30mlnMT)
- Costs = 885mln$ (1545 - 660)
---------------------------------
EBIT = 555mln$
EPS = .1$ -> PE ratio = 1.4
in this monent theoretical price should be 1.07AUD (still not to bad).
From other hand I saw compatision to GBG..
Using same methodology
for GBG theoreticel price is 7.94 versus 1.335 current
( 4.95 ratio [7.94/1.335])
for SDL theoretical price is 5.83 versus .15 current
(37.92 ratio [5.83/.15])
If SDL will be in same position as GBG (partner, off take agreement e.t.c)
its price can grow to 0.15*37.92/4.95 = 1.14AUS
Of course it will depend on situation on the market,
so it might be in reallity 0.28AUS (ore @ 68$) to 1.14AUS (ore @162$)
And at the end.
Sure we do not know what future will bring us, but once, one wise man told me:
It is better to calculate something than not.
Let me provide mix analyse (tell mi if you will have enough)
Let us calculate what would be theoretical price,
that will in future give us market price 0.15AUS.
.15/10 =.015EPS
.015*2.8Bln = 42mln * 2 = 84mln (EBIT)
EBIT = 84mln
+ COSTS = 1545mln
------------------
= Revenue = 1587mln
Revenue / production = 1584mln/30mln = 52.9 USD/mT
in this case as bubble explode cost of fracht will sink foom 24.2 to 20 (?)
Than we will have FOB CHINA 52.2+20 = 72.2 USD (and this price was last time in 2005 )
The price for Fines ore was in average:
2006 - 76.2
2007 - 83.4
2008 - 132 to 90
2009 - 68 to 110
2010 - ???
So there is chance that .15$/ share is to high (ore price should by lowet then 72.2USD/MT)
In my calculation there is position 660mln capex repaied.
I assume 3.3blm in 5 years (sorry was to lazy to include interest rate discount)
In consquence after repaying that bottom line for ore price would be
EBIT = 84mln$
+ COSTE = 1545mäl$
-CAPEX = -660mln$
----------------------------
= revenue 969mln$
969mln$/30mlnMT = 32.3$/MT + 20$ fracht = 52.3$/MT CIF China
Such price we recentyl saw in 2004
How it will look for last lower price (03.2009 - 68$) ?
68$ - 20$ fracht = 48$ FOB Africa
Revenue = 1440mln$ (48$*30mlnMT)
- Costs = 885mln$ (1545 - 660)
---------------------------------
EBIT = 555mln$
EPS = .1$ -> PE ratio = 1.4
in this monent theoretical price should be 1.07AUD (still not to bad).
From other hand I saw compatision to GBG..
Using same methodology
for GBG theoreticel price is 7.94 versus 1.335 current
( 4.95 ratio [7.94/1.335])
for SDL theoretical price is 5.83 versus .15 current
(37.92 ratio [5.83/.15])
If SDL will be in same position as GBG (partner, off take agreement e.t.c)
its price can grow to 0.15*37.92/4.95 = 1.14AUS
Of course it will depend on situation on the market,
so it might be in reallity 0.28AUS (ore @ 68$) to 1.14AUS (ore @162$)
And at the end.
Sure we do not know what future will bring us, but once, one wise man told me:
It is better to calculate something than not.
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