The Motley Fool

Could KAZ Minerals beat the SOLG share price in 2019?

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

A golden egg in a nest
Image source: Getty Images.

Shares in KAZ Minerals spiked up by 12% on Thursday, after Q3 production led the miner to lift its full-year guidance for gold production.

With 13% more gold produced than in the previous quarter, reaching 45.1 koz from Q2’s 39.9 koz, full year output is now “expected to be at top end of 160-175 koz guidance range.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic… and with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be a daunting prospect during such unprecedented times.

Fortunately, The Motley Fool UK analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global upheaval…

We’re sharing the names in a special FREE investing report that you can download today. And if you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio.

Click here to claim your free copy now!

On top of that, copper production rose by 7% to 77.2 kt (from 72.3kt in Q2), and the company says it’s on track for meeting full-year guidance of 270-300 kt.

The KAZ share price had been in a bit of a tailspin, having lost more than 50% of its value since its 2018 peak in June. But a month ago, fellow Fool writer Peter Stephens rated the turnaround potential for a recovery as high, and this latest update will surely strengthen that sentiment.

Price recovering?

The share price rise on the day, while welcome, does need to be taken in context — it has actually only just returned to the level it stood at a week ago, before dropping in the days before the current update.

Analysts are predicting modest earnings rises for this year and next, but those would be sufficient to drop the stock’s forward P/E to only 5.6 this year, and as low as 4.8 in 2019. And with the share price so low, dividend forecasts suggest yields of 2% and better, even though the cash would be covered nine times by earnings.

What are the downsides? Net debt of $2bn at the halfway stage at 30 June looks scary, but that’s only approximately 1.5 times annualised EBITDA, which is a multiple that’s generally considered manageable.

We’re looking at an impressively low PEG ratio for 2019 of 0.6 too, which is often a good growth indicator.

KAZ is risky, certainly, but I’m also feeling positive about the recovery potential here.

More glitter

Gold miners tend not to excite me too much, but I can’t help but notice a recent share price spike at SolGold (LSE: SOLG). After a big slump in 2017, the price has soared by nearly 90% in less than two months.

Part of the boost comes from confidence in the firm shown by BHP Billiton which, this month, subscribed for 100 million new shares in SolGold at 45p apiece, to raise £45m for the company.

There are a number of conditions attached to protect BHP’s interest, including the right to appoint a director to the SolGold board. To me, it all adds up to a step forward in governance and a lowering of the risk for private investors.

Some risk

My colleague Peter again appears cautiously optimistic, suggesting thatwhile potentially volatile in the near term, the stock could have investment appeal.” That was before the BHP involvement was announced, and I think the latest news reinforces Peter’s thoughts.

I’m always wary of the fact that gold has little actual use other than as artificially desirable shiny stuff. But it’s in a reasonably buoyant phase at the moment, and with world political and economic uncertainty likely to continue for some time, this could be a good time to get into gold stocks.

I rarely go for risky growth stocks these days, but a younger me could have been tempted by both of these.

One Killer Stock For The Cybersecurity Surge

Cybersecurity is surging, with experts predicting that the cybersecurity market will reach US$366 billion by 2028more than double what it is today!

And with that kind of growth, this North American company stands to be the biggest winner.

Because their patented “self-repairing” technology is changing the cybersecurity landscape as we know it…

We think it has the potential to become the next famous tech success story.

In fact, we think it could become as big… or even BIGGER than Shopify.

Click here to see how you can uncover the name of this North American stock that’s taking over Silicon Valley, one device at a time…

Alan Oscroft has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.