Tritax Big Box is targeting a fully covered dividend of 6.2p per share for the full year. This puts it on a yield of 4.9% following its 4% share price fall since the EU referendum. Clearly, Tritax Big Box is highly dependent on the state of the UK economy and it therefore comes with greater risk following the decision for the UK to leave the EU. It has an enticing price-to-earnings growth (PEG) ratio of 1.5, but with the potential for high volatility in its share price, as well as downgrades to profitability, it may be prudent to await further news regarding the performance of the UK economy before buying-in.

Strong pipeline

Also reporting today was infrastructure specialist John Laing (LSE: JLG). It has maintained its full-year guidance for investment commitments, namely in line with the £180.5m delivered in 2015. It has also maintained its full-year guidance for investment realisations and expects to record proceeds of £100m.

Encouragingly, Laing has a strong pipeline of new investment opportunities in public-private partnerships, renewable energy and other infrastructure sectors. Furthermore, the market for the disposal of secondary infrastructure investments remains buoyant. This bodes well for the company’s future and its exposure to international markets such as North America and Asia Pacific should provide stability at a time when the UK outlook is rather uncertain.

Laing trades on a price-to-earnings (P/E) ratio of just 6.4 and has a yield of 3.5%. This indicates that now could be an excellent time to buy it – especially with positive growth in earnings forecast for each of the next two years.

Up for discussion

Meanwhile, shares in Beowulf Mining (LSE: BEM) have soared by 37% today after it announced that the Swedish government has listed the company’s application for an Exploitation Concession for Kallak North on its meeting agenda for discussion today. Although this news has been welcomed by the market (as evidenced by Beowulf’s rising share price), the results are due out shortly and there can be no guarantee that they’ll be favourable.

Clearly, Beowulf has considerable long-term potential and believes that it will be able to deliver a modern and sustainable mining operation in partnership with the local community at its Kallak asset. However, with the company’s shares being highly volatile, it may be prudent to await further news flow before buying them. That’s especially the case when there are a number of post-Brexit buying opportunities on offer.

The post Are Tritax Big Box REIT plc, Beowulf Mining plc and John Laing Group plc post-Brexit ‘buys’ after today’s updates? appeared first on The Motley Fool UK.

Moving lower

The market reacted badly to insurance play Beazley’s (LSE: BEZ) announcement on Thursday that it plans to relocate its headquarters from Dublin to London. Shares in the business were last dealing 5% lower from Wednesday’s close.

Beazley — which moved to the ‘Emerald Isle’ six years ago — advised that the plan “will simplify the management and decision making of the group and allow new Beazley shareholders access to a UK dividend stream.” The firm added that there should be no changes to its tax rate following legislative changes in the Finance Act 2012.

A vote will be held on the issue on 24 March. But regardless of the outcome of next month’s meeting, I believe a backcloth of rising competition and falling rates in its markets makes Beazley a risk too far at the present time.

Indeed, the City expects the insurer to endure a 23% earnings slip in 2016 alone, and further dips are predicted further out. I do not believe a consequent P/E rating of 13.8 times sufficiently reflects Beazley’s high risk profile.

Supermarket struggles

The newsflow surrounding embattled grocer Morrisons (LSE: MRW) just keeps getting worse and worse.

Discounter Aldi pulled its tanks directly onto the Bradford firm’s lawn this month with its new ad campaign, which claimed it undercuts the so-called ‘Big Four’ supermarkets on price by as much as 40%. The German giant also announced plans to open a further 80 stores by the end of the year as part of its aggressive expansion scheme.

Morrisons has persistently failed to stem the march of both Aldi and Lidl, with price reductions of its own failing to dent the rising popularity of its discount rivals. Indeed, the supermarket has introduced little more than token initiatives — like the rollout of wi-fi ‘hotspots’ and discounted coffee in its stores this month — to draw back customers.

Unsurprisingly the City expects Morrisons to have suffered yet another earnings fall in the year to January 2016, and while a 21% bounceback is predicted for the current period, I believe such predictions are fanciful at best amid rising competitive pressures. Besides, a consequent P/E rating of 17.9 times is far too expensive for a stock with such a poor long-term earnings outlook, in my opinion.

Stuck in a hole

Iron ore digger Beowulf Mining (LSE: BEM) also fell foul of the market in Thursday’s session following news of a capital raising, and the stock was last dealing 30% lower from yesterday’s close.

Beowulf advised that it was planning to generate £1.25m through the issuance of shares at 3.25p each. The company commented that “low metal prices and a broad lack of confidence has led to an unfavourable environment for exploration and development companies to raise capital and advance with project development”.

And worryingly Beowulf added that “we expect market conditions to remain difficult for the mining sector,” a view that I cannot disagree with.

 Sure, iron ore prices may have ticked up more recently, but I believe cooling Chinese steelmaking activity — combined with rampant production activity from industry giants like Vale and BHP Billiton — should prompt a severe reversal and keep Beowulf running at a loss in 2016 and beyond.

The post Should You Buy Beazley PLC, WM Morrison Supermarkets PLC & Beowulf Mining plc Today? appeared first on The Motley Fool UK.

While things could realistically get worse before they get better for mining companies, that could mean buying companies that offer size, scale and profitability could be a shrewd move for investors. That’s because the larger mining companies may have the most appealing risk/reward ratios in terms of offering low prices and upward rerating potential, as well as a track record of profitability and relative financial soundness.

Going For Gold

Fresnillo (LSE: FRES) is among the largest silver producers in the world and Randgold Resources (LSE: RRS) has the same status among gold producers. With their share prices having fallen by 62% and 28%, respectively, since the start of 2013, it’s clear that they’re trading at a low ebb. That’s no surprise after their huge falls in profitability, with Fresnillo’s earnings per share (EPS) declining by 93% in the last three years and Randgold Resources’ EPS being 47% down in just two years.

While these EPS figures are hugely disappointing, both companies have been able to stay in profit throughout the price falls in gold and silver. And looking ahead to the next two years, they’re expected to post excellent growth numbers. For example, Fresnillo’s bottom line is forecast to rise by 158% this year and by a further 84% next year. This puts it on a price-to-earnings-growth (PEG) ratio of just 0.4, which indicates a share price recovery is on the cards. And, with Randgold’s earnings expected to rise by 22% next year, its PEG ratio of 1.1 is also highly appealing.

In The Slow Lane

Clearly, not all mining companies have the size, scale and production capabilities of Fresnillo and Randgold, which makes them a less appealing investment for now. Take African Potash (LSE: AFPO) and Beowulf Mining (LSE: BEM) that are a fraction of the size of their two sector peers. Many investors may be bullish on their long term prospects after their share prices have collapsed by 40% and 47%, respectively, since the start of 2013. Yet their appeal for most investors may prove to be limited.

That’s not necessarily because those long term prospects are disappointing, or that their strategies or management teams are poor. It’s merely a reflection of the current state of the mining sector that there are large-cap miners trading at exceptionally low prices and that offer the potential for growing profitability over the short-to-medium term. Furthermore, those large-cap firms offer greater diversity and financial strength than their smaller peers and, as such, appear to offer a more favourable risk/reward opportunity for the long term.

The post Why I’d Buy Fresnillo plc And Randgold Resources Limited Over African Potash Ltd And Beowulf Mining plc appeared first on The Motley Fool UK.

Mining giant continues to sink

It comes as no surprise that investor appetite for diversified digger Anglo American (LSE: AAL) continues to languish along with commodity prices. The business was recently dealing 5.2% lower from Thursday’s close, taking its total share price reversal during the past 12 months to 70%.

Energy and metals prices have staged a modest rebound in end-of-week business, but this relief rally is not set to last in my opinion as eroding Chinese buying activity exacerbates bulky oversupply. Bellwether metal copper hit fresh six-year troughs below $4,500 per tonne this week, while oil remains perched precariously around the $45 per barrel marker.

And critically for Anglo American, conditions in the iron ore market, a segment from which a quarter of group revenues are generated, are predicted to remain tough. Fitch expects the steelmaking ingredient to average $50 per tonne in 2015 and 2016, with 145 million tonnes of new material — or 10% of the total seaborne market — expected through to 2017, Bloomberg reported.

Shares in Anglo American are clearly in freefall, and it is hard to see how the company can stage any kind of turnaround at the present time. The number crunchers expect the company to record earnings dips of 53% and 29% in 2015 and 2016 respectively, and although Anglo American deals on a cheap P/E rating of 8.3 times, the prospect of further earnings downgrades still makes the firm a highly-unattractive stock pick in my opinion.

Digger on the charge

Shares in dedicated iron ore play Beowulf Mining (LSE: BEM) have not suffered the same indifference in Friday trade, however, and the business was last 19.5% higher on the day.

The company has already seen its share price spike in recent days, galloping from around 3.3p per share just a fortnight ago to just over 7p earlier this week, the headiest for more than a year. Prices surged again today after Beowulf advised that pre-tax losses narrowed to £1.1m during January-September from £2.1m a year earlier.

Still, the business advised that it is still awaiting approval to start work at the Kallak North iron ore project in Sweden. And of course Beowulf’s earnings outlook remains hampered by the steady decline in metal prices. Given these factors, I believe the company remains a high-risk bet, and investors should expect further heavy volatility down the road.

Oil play shoots higher

Like Beowulf, fossil fuel specialists UK Oil & Gas (LSE: UKOG) have also bounced higher more recently, and the operator was last 18.5% higher from Thursday’s close. The company advised this week that it had completed a farm-in agreement to buy an extra 10% stake in the Weald Basin licence, PEDL143, and follows a similar deal to secure a 20% holding in the licence just last week.

The licence includes the Holmwood asset, where UK Oil & Gas is intending to start work at the Holmwood-1 exploration well next winter.

But like its resources peers discussed above, I believe UK Oil & Gas remains a risky pick owing to the huge uncertainty swirling across commodity markets, a situation that could undermine the firm’s long-term earnings prospects, not to mention the economic viability of its assets. And like Beowulf, I believe fresh share price swings can be expected, such is the danger of investing in small minerals and energy operators.

The post Should You Buy Anglo American plc, Beowulf Mining plc & UK Oil & Gas Investments PLC? appeared first on The Motley Fool UK.

On the other hand, though, buying at the bleakest possible moments can prove to be a very sound investment strategy. Certainly, it means running the risk of great pain in the short run via continued losses, but in the medium to long term the valuations on offer in the mining sector could be the catalyst for share price growth.

For example, Anglo American (LSE: AAL) now trades on a price to book value (P/B) ratio of only 0.35. This indicates that its shares offer a significant margin of safety so that even if there are major asset writedowns and the company’s bottom line remains deep in the red, its shares could still perform well in the long run.

Of course, a rise in the price of platinum and other commodities would be a significant help for Anglo American. Although future prices for any commodity are a known unknown, it seems likely that the price of platinum will gradually recover since supply is due to be constrained and the sale of diesel cars (for which platinum is an important component) is likely to remain high even after the Volkswagen ‘scandal’. Furthermore, with Anglo American focusing on core assets and selling off assets which it feels do not offer an appealing risk/reward ratio, it could prove to be a very appealing, albeit volatile, long term investment.

Similarly, gold miner Centamin (LSE: CEY) has been hit hard by the falling price of gold. In fact, gold reached a five-year low earlier this year, but its popularity as a store of wealth could help it to rise if the global economic outlook continues to be highly uncertain.

In addition, Centamin is in the process of increasing production volumes so that over the next couple of years it is likely to deliver much higher levels of profit. For example, next year its bottom line is expected to rise by 22% and, despite this, Centamin trades on a forward price to earnings (P/E) ratio of just 11.1. This indicates that now could be an opportune moment to buy a slice of the business.

Meanwhile, shares in Beowulf Mining (LSE: BEM) have risen by 25% today and this has prompted the company to issue a statement saying that it is unaware of any reason for the significant share price move. This price rise puts the company’s shares 203% up over the last year, although trading at around 550p they are still vastly lower than their 7300p peak recorded as recently as 2011.

Certainly, a number of smaller mining companies have considerable long term potential, but for most investors their larger peers seem to make more sense as investments at the present time. That’s because even they are exceptionally volatile, capable of posting major losses but, crucially, tend to be financially more secure, more diversified and arguably better positioned to benefit from any future increase in commodity prices. As such, the likes of Anglo American and Centamin appear to be better buys that Beowulf at the present time.

The post Are Anglo American plc, Beowulf Mining plc & Centamin PLC Set To Soar? appeared first on The Motley Fool UK.

Revenue woes continue to swirl

Battered minerals play Kenmare Resources (LSE: KMR) announced in Friday business that a combination of lower commodity prices and production problems pushed revenues 9% lower during January-June, to $73.9m, a result that caused operating losses to widen to $27.2m, from $17.9m a year earlier.

The miner, which produces titanium minerals and zircon, has introduced a massive cost-cutting scheme to offset the effects of a sickly top-line, and total cash operating costs obligingly fell 17% in the first half to $69.1m. But Kenmare faces the prospect of further weakness in the ilmenite price — Melior Resources mothballed its Goondicum mine in Queensland earlier this month thanks to a weak market — a situation which threatens to smash its earnings outlook.

Indeed, the City does not expect Kenmare to flip into the black any time soon. Losses of 3.62 US cents per share last year are expected to narrow to 1.72 cents in 2015 and to 1.14 cents next year, but today’s results could result in downgrades to these sickly results, not to mention a subsequent collapse in Iluka Resources’ takeover attempt.

Swedish digger under pressure

The story was somewhat better for Beowulf Mining (LSE: BEM) in Friday trading, with the business announcing that it booked a £330,276 pre-tax loss in the first six months of 2015, a vast improvement from the £1.32m loss recorded in the same period last year. The Sweden-focussed miner had falling corporate overheads and zero derivative losses to thank for the result.

Beowulf said that it is “looking forward to a busy second half of the year” as it hunts an exploitation concession for the Kallak North iron ore asset. But although the explorer received a boost last month as authorities in Norrbotten County decreed that the project would create vast “economic benefits,” plenty of uncertainty still faces the company.

The necessary paperwork is still to be signed off for work to commence, of course, while Beowulf’s fragile capital position is also casting concerns — cash and equivalents of £172,955 have dived from £554,436 at the same point in 2014. And should the iron ore price continue to crash, the economic viability of Beowulf’s operations could come under fresh scrutiny.

Jubilee losing its lustre

So should the problems facing Kenmare and Beowulf prompt investors to park their cash in Jubilee Platinum (LSE: JLP)? In my opinion the answer is a resounding ‘no’, even though a 12.5% share price advance in Friday trade suggests the wider market is far more optimistic over the firm’s investment potential.

Shares in Jubilee also rocketed in July following news it had hived off its Middleburg non-platinum businesses to raise £5.8m, a critical step in financing the company’s two surface tailings projects. And the company has since secured debt funding to create what its two “transformational” platinum-processing assets.

But naturally Jubilee remains at the mercy of a volatile platinum price, and this week’s dive towards $970 per ounce took it to levels not visited since 2009. With Chinese demand on the wane and usage in the critical auto sector gradually eroding — automakers are opting increasingly for cheap palladium in exhaust systems — I fully expect platinum prices to continue falling, a terrifying prospect for Jubilee’s earnings outlook.

The post Is Jubilee Platinum PLC A Better Stock Selection Than Kenmare Resources plc Or Beowulf Mining plc? appeared first on The Motley Fool UK.