ShareHub Hotlist 2018 Review Week 18

Oh, yes we’re in the money, you bet we’re in the money,
We’ve got a lot of what it takes to get along!
Let’s go we’re in the money, Look up the skies are sunny…

Sunny indeed. What a belter of a bank holiday for blighty. The chances are it’s come too late for Carney and BoE’s rate plans. The beast of the east has apparently cost the UK economy billions. Of course there is more to the recent Retailers demise than just a bit of poor weather. Amazon and other digital providers are the main source of concern for bricks and mortar retailing – that and a worringly weak consumer back drop. It’s not going to get any easier for them. The future is ‘online’. But changes in dynamics brings with it a change in thinking. You’ve got to out-think your competitors if you can’t beat them on margins. Which is precisely why the Sainsbury & Asda merger deal makes so much sense. It’s always nice when the plethora of hedge funds and wide-boy boiler rooms shorting Sainsbury stock get a rocket up the derriere. You’re not in the money… not in the money… your losses are a lesson to ooo ooo thee.

Week 18 was a good’un’ for Hummingbird Resources. You wouldn’t know it looking at the share price. The stock has barely moved from levels last seen in August 2017 when PoG was $1250oz and their Yanfolila mine was just a few mounds of scorched red Mali dirt. Fast forward 9 months, and the red dirt has been transformed into a fully operational and ‘commercial’ mine knocking out roughly 10koz per month. Add to this the surge in PoG prices now in a range of $1300oz to $1360oz and one has to scratch the head as to why HUM is still priced at Aug 2017 levels. One reason for the sluggish performance rests not with the business but with a large investor called Pageant Holdings who have (for there own reasons) been reducing holdings of circa 5%+ down to 2.9% and lower. One thing is sure, you’ll know when they are done selling as the share price will likely catch up with the business performance pretty fast. It’s certainly a potential ‘opportunity’ for newbie investors looking for exposure to Gold prices via a fully commercial early producing mine. As always, risks remain so read the general investment risk warnings in the sidebar.

Elsewhere across the TheShareHub top picks for 2018, CERP.L is showing signs of awakening. Looking across at their peers in Trinidad and Tobago, TRIN.L have performed terrifically well bouncing almost 100% over the last few months. Any positive update from CERP on production or further acquisitions could see the stock play ‘catch up’ pretty fast. At 5.5p range, the stock is trading well below Oct 2017 highs of circa 7.5p. It might not be too long before the stock heads higher. Schroders continue to build their stake in the company with recent Holdings RNS’s showing a stake of circa 14.2%. TheShareHub highlighted back in Jan 2018 that Schroders may well be targeting a nice round number at 15% or possibly 20%. For the moment, it’s a process of shares leaving the hands of the impatient to the patient. CERP may not appeal to the usual daytrader types due to low liquidity, but just wait for a deep exploration well to be announced in 2018 or 2019 and the herd will be fighting to get through a very narrow door. Schroders and co already have their seats booked.

Week 18 positions below: Further recoveries from the newspaper picks as they head toward breakeven for the year (excluding any divi’s). TheShareHub Hotlist is the only one ‘in the money’ and is just shy of hitting 2018 highs last seen some 5 months ago. It’s been seasaw stuff with the DOW losing some 2500pts over the same period, so certainly a strong sign of out performance by commodities of late. All eyes on US/Iran sanction decisions set for before or on Thursday May 10th. Could be same day as BoE’s now fast becoming non-event rate decision. PoO will likely sell off whatever the scenario this week as the casino market likes to shake it up albeit temporarily. Bigger woes lie ahead for Oil supplies beyond Iran as non opec output continues to fall against rising demand. When the rebalance arrives, the market is likely to overshoot as it’s far from sophisticated these days and a little heavy handed. $85pb is certainly possible over the next few months. Bodes well (should it happen) for ShareHub picks TLW, PFC, SQZ, CERP, AMER and PMO.