Sunday 22 November 2015

Tuesday 10 November 2015

Jubilee Platinum - Technical Update (10/11/2015)

Disclaimer: I don't have a licence to give financial advice, don't therefore view this as such.


As you can see below there is a ginormous continuation pattern occurring in Jubilee Platinum right now. I would expect this to continue in line with the current weekly trend to the upside.



To calculate a target from an upside break of this pattern we do the following:


Find the first major high (August) = 5.45p

Find the first major low (September) = 2.8p

Find the mid point of the triangle (the two numbers above) = (5.45+2.8)/2 
                                                                                               = 4.125p

Difference between first major high and first major low = 2.65p

Price Target on upside break = Triangle mid point + major high major low difference

= 6.775p (implied upside of 78% from the current share price - 3.8p).










Here's the same image from a weekly perspective to give you a long term contextualised view:







 This weekly chart is very handy for showing the levels of support and resistance - good news should move us up to the 4p resistance and then after this it's a straight path to the 5-6p range.



Here is a fundamental look at the company that I put together:

http://themaskedstocktrader.blogspot.co.uk/2015/11/jubilee-platinum-short-analysis.html




Enjoy,

The Masked Stock Trader

Jubilee Platinum - Short Analysis

Disclaimer: I hold a long position here and the following piece should not be viewed as financial advice.


Company Overview:


Jubilee Platinum Plc is a platinum focused mining exploration and development company with a focus on platinum group elements (PGE) and nickel. The Company has added PGE, ferro-alloy smelting and refining to its capabilities. 

Jubilee’s 63% owned Tjate project on the Bushveld Complex covers 5,140 hectares on three farms and contains a potential net 65 million ounces of platinum group elements (PGEs) and gold (1).




Company Data:


Market Capitalisation (as of 10/11/2015): £32.26 million

Shares in issue: 893.16 million



Expected Short-term News-Flow:


1. The completion of debt financing (2).
2. The granting of a mining licence for Tjate (3).




Valuing Jubilee Platinum:


I like cash, and as a result of the sale and Disposal of the Middelburg Operations, Jubilee Platinum have received £5.42 million to add to the £424,000 of cash they had as of their interim results (4). This in combination with the £2.422 million raised in the 05/08/2015 placing (5) means that Jubilee Platinum should have (not accounting for cash burn) ~ £8.266 million of cash to hand, or 25.6% of the value of the company in cash.

If we assume that Jubilee Platinum will be awarded their "advanced talks" debt funding for £12.9 million, this will place Jubilee Platinum in a position whereby it has £21.166 million to progress with (5), or 65.6% of the company in cash.




I'm not a commodities analyst by heart, so I've left that to someone who knows more than me on LSE and have just copied and pasted his/her's information (I hope they don't mind):


"I've seen some debate about what the SP may be by Xmas. So Here goes with my assessment on what JLP MCAP valuation should be with confirmation of the Tjate license and expectation of production proceeding as planned with the Talings projects. My view we should be valued at least 150m. Why? Well...

By disposing the none core side of Middelburg, we have retained power at cost and access to our smelter to start actual Platinum smelting. Our core business target and a far more profitable business. With the cash (recent placing, Middleberg sale, warrants and once debt funded plan in announced ) we can fund the first processing plant for the Dilokong tailings. We will be producing Platinum and PGE at the start of 2016.

Furthermore, we have confirmed we have 'no debt' and with cash in the bank, we have been able to negotiate and agree funding for the second surface tailing project at the Hernic/Mitsubishi site. Two above ground tailings projects on the go in the coming months with reported revenues starting at $14m per annum and further surface tailings projects expected to come on line. **not to mention the 25% premium payment if production commences by no later than 31st January**. Additionally this does not factor in a highly likely 3rd Tailings project which the BoD have hinted at and have confirmed negotiation - confirmation of this would represent huge gain.

Then we have the Tjate mining licence expected we have a complete game changer within our grasp. PGE's in South Africa used to have an average in the ground price at over $25 per ounce. Tjate was once valued at $7 per ounce according to CB, without a licence. So when the mining licence is finally issued we can expect a strong rerate as the in ground metal adds value. 70,000,000 ounces to be priced in. Even at a conservative $2-$3 an ounce that's a MCAP of £95m to £135m on Tjate resources alone. Then there's the current tailings projects with over 400,000 ounces which will reap $500-$600 profit per ounce or a revenue of $14m per annum at the start. This should add a minimum £100m to the MCAP at a p/e of just 10.

I could add on the value of current assets like the retained smelter at Miiddelburg, the rights to any future Power Alt expansion, other agreements or the cash in hand.

So hopefully you will see a conservative £150m MCAP which equates to an SP of 16-17p. This is very achievable quickly and should re rate as the news flow comes in" (7)





Over a medium to long term period, this seems to be a fair evaluation, but I think that it's worth reminding oneself that the movement into a higher interest rate environment will likely place more downwards pressure on commodities, meaning that for comforts sake it maybe worth discounting the figures above by 5-10%.




If i've missed anything major or you want me to add something, leave a comment and I'll try and sort it out.


Cheers,

The Masked Stock Trader


Sources:

1. http://www.reuters.com/finance/stocks/companyProfile?rpc=66&symbol=JLP.L

2. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=JLP&ArticleCode=uv7jiih4&ArticleHeadline=Statement_regarding_share_price_movement

3. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=JLP&ArticleCode=5tdzrv35&ArticleHeadline=Interim_Results

4. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=JLP&ArticleCode=5tdzrv35&ArticleHeadline=Interim_Results

5. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=JLP&ArticleCode=6v7rppgr&ArticleHeadline=Funding_Secured_for_Surface_platinum_projects

6. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=JLP&ArticleCode=loo8xoje&ArticleHeadline=JLP_commence_surface_platinum_project_construction

7. http://www.lse.co.uk/member-info.asp?nick=Multibagger1

Saturday 7 November 2015

Chart Patterns 07/11/2015

My system was being a little awkward today and I threw in the towel early during my scans, but here are a few gems I've picked out for the next few weeks.



Daily Charts: