There was an RNS this morning from CMCL:Caledonia Mining to say they were planning to list on the New York Stock Exchange. As the minimum value per share is $2 with a preference for $5 they are doing a share consolidation prior to the listing.
At first this seemed fine, until I read the details.
It's one share for every five, however, rather than just do that they are initially doing one for every hundred, and then multiplying that by 20.
Yeah right - I had 737, so after paying 135p per share I'm going to let 37 of them sell for 94p - I think not!
I loaded £200 into my ISA from my current account and bought 263 at 98p costing £269.69. This brings my total up to a nice round 1,000 shares. That will go down to 10 on the initial consolidation, then up to 200 on the second phase, with no loss of shares.
The effect was to bring my average price down from 135p to 125.3p so I'm hoping the new liquidity of listing in America along with a gold rally will get these back to profit. I did rather buy on a spike! Although miffed at the price I originally paid, I'm not too concerned as the P/E ratio is just 10.7 and that's based on the price of gold last year. With production ramping up a P/E ratio of 15 would be worth about 350p, and while there's risk with their country of operation which will likely keep the price down, my target is at least 250p, around double what I paid.
I do like this as a gold share, with a quarterly dividend of £8 just ticking along nicely. It's not as good a return as PAF:Pan African Resources but I think a bit less risky, despite being in Zimbabwe. Having said that, the PAF:Pan African Resources dividend is so good, I'm tempted to get back in just before the October ex-date if the price doesn't go mad.
KAT:Katoro Gold dropped 2.5% today. I'm keeping an eye on this one, but as I'm expecting a decent chunk of free shares from KIBO:Kibo Mining I won't be buying any. However, if the price drops much further it might be one for the trading account!
At the halfway point, this week is looking OK. The combined portfolios are up by £395, with AMYT:Amryt Pharma doing particularly well. OPTI:Optibiotix has slipped a bit else things would be looking much better.
I was quite shocked to see VEC:Vectura has dropped to 120p on the news that the Americans have rejected their joint bid with HIK:Hikma Pharma to sell a generic version of Advair, until now protected by patents. The share price has dropped from 150p to 120p which seems a bit of an over-reaction. I sold my holding at 153p for a £89 loss, but am keeping an eye on this, as although the rejection will cost them this year, they are likely to get approval eventually so a recovery seems on the cards. The question is how much lower will it go beforehand?
I do like to keep track of my old shares. Sometimes it's painful, when I see TON:Titon Holdings at 165p after I sold at 101p and 91p, although that was still 15% profit. Sometimes I'm filled with relief that I got out in time, like with AFG:Aquatic Food which has dropped even further, or RCI:Rapidcloud which has vanished but gave me an 11.4% profit. AVM:Avocet Mining was another close one, yielding just a 3.5% profit but that would now be a 50% loss. It's amazing how many of them are pretty much the same price as when I sold though.
Right - time to don my Man Utd top, crack open a beer and prepare for the most important game we've had for many a year!
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