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Opinions Brooke Thackray
B2Gold Corp.BTO.TOWAITOct 27, 2017
Brooke ThackrayStock price when the opinion was issued
As of Jun 19, 2026. Market Open.
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Symptom of the space. Very good executors, diversified asset base. Trades at a premium, so the bloom comes off when sentiment turns. Attractive yield around 4%, that's why he owns it. Recent acquisition will be additive by 2025.
Dennis da SilvaEPS of $0.05 missed expectations of $0.0656 and revenues of $477.89M missed expectations of $484.68M. Gold production was 242.8K ounces in the quarter, with expectations of an increase in Q4. Its AISC were lower than annual guidance ranges, which is a positive, and its Goose project construction was on budget. It remains on track to meet its 2023 total gold production forecast, Its gross profit improved significantly, however, it incurred higher operating expenses due to impairments and foreign exchange losses. Its cash from operations remains strong and its balance sheet is in good shape. This was an OK quarter, and we feel much will depend on the price of gold, although production is moving in the right direction.
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We have tended to lean towards large caps, such as AEM. We think KRR and AGI are also buys. BTO is a fairly large cap, offering good value at only 10X earnings with a 4.7% dividend. The balance sheet is very solid with $500M cash. We like it, but consensus calls for very low growth in the next two years, and EPS is still down from 2020 levels. So buyers need to have some patience. The last quarter was OK. NGG has outperformed BTO, and also has cash (only $35M though). But it is not yet producing so is still losing money, with negative cash flow. While we think it has potential, at this time we would prefer producers, taking comfort in the ongoing cash flow in a tough environment vs owning a developer still burning cash.
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Big fan of management team.
Large shareholder in company.
Market concerns over recent M&A.
Is a good long term investment.
Dividend payout not as high because using cash in exploration & development.
Rick RuleVery good company that performs well consistently.
Good long term assets.
Ability to grow has been proven.
Great management team.
Dividends continue to grow.
Rick RuleHis theme today is leverage, nice yield, and ability to grow cash. Production in West Africa. Newly entered into Nunavut. Experienced. Can improve economics of Back River mine, and this will balance another mine's shutting down in 2025. No debt. Yield is 4.04%.
(Analysts’ price target is $7.51)Dennis da Silva;fill-opacity:1;'/%3e%3cpath%20d='M31%2018.6001V30H8V18.6001L14.1334%2022.4334L19.4999%2014L24.8669%2022.4334L31%2018.6001Z'%20fill='%23EE5432'%20style='fill:%23EE5432;fill:color(display-p3%200.9340%200.3310%200.1956);fill-opacity:1;'/%3e%3c/svg%3e){kind=small}
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Premium contentBTO is a million ounces a year gold producer with assets in Mali, the Philippines and Namibia. Analysts expect quarterly production will be reported to have hit record levels in Q4:22 -- up over 25% on the year -- when earnings are released later this month. It pays a good dividend for a gold producer, backed by a payout ratio under 75% of cash flow. It trades at under 2x book value. We like that cash reserves are growing, while debt is being retired. We recommend placing a stop-loss at $4.40, looking to achieve $7.50 -- upside potential of 38%. Yield 4.0%
(Analysts’ price target is $7.50)
John Zechner
Rick Rule
Gold seasonality is really from the end of July to the beginning of October, but it can also do well from December into February. There is an interest rate increase possibility for December in the US. If they do, it hurts gold. Has seen gold perform poorly in December until the end of December because of the tendency for the Fed to raise rates at the end of the year. Wait until the end of December before actually adding, and then let it run into Jan/Feb.