African platinum miner in an ideal position
It is quite refreshing to see companies issue profit upgrades ahead of a closed period instead of profit warnings, which seem to be a plenty.
This is what we got from beaten-up AIM miner Jubilee Platinum (JLP) yesterday.
The company announced on the Johannesburg Stock Exchange, where it has a dual listing, that it expects an increase in earnings per share of between 50 to 70 per cent for its financial year ending June 2010, compared with the previous year.
The results are expected to be released circa 30 September.
Jubilee Platinum's prime asset in South Africa is the Tjate Platinum project, in which it has a 63 per cent beneficial interest.
The exploration area has been independently estimated to be a target for potentially some 65 million ounces of platinum group elements and gold.
The Company acquired Braemore Resources last year, which holds an exclusive licence to the ConRoast technology process for the smelting of high chrome platinum group metals.
High chrome content in platinum, used in traditional smelters, can be hugely damaging to the smelter if processed unchecked, hence why platinum giant Lonmin (LMI) and others have had smelting problems over the last decade.
This places Jubilee Platinum in an ideal position to process not only its own material but also that of its competitors.
Analysts are likely to upgrade their forecasts in coming days/weeks which should benefit the share price while the soaring price of platinum should enhance the stock's performance. Expect resistance to come in at 40-42p while support should be found at 30p.
Update
Bowleven – Tipped as a buy at 177.25p, the stock closed at 180p yesterday. Sit tight and wait for corporate and drilling developments both of which are due imminently.
New British Palm Oil – Tipped as a buy at 572p, the stock closed at 630p. The stock is now in clear break-out territory. Place a stop at 610p to ensure profits.
Communisis – Tipped at 23.625p, the stock closed below 22p on Monday and has not worked, despite yesterday's uplift to 24p. Cut the position and move on.
IQE – Tipped at 24.25p, the stock closed yesterday at 32.75p, a good gain of35 per cent. Hold for now, with a view that a dip towards 30p could be a possible topping up opportunity.
Tissue Regenix – Suggested as a buy at 16p, the stock has slipped to 13.5p. Sit tight despite the dip and if you have no position, this might be an opportunity to pick up stock on weakness.
Pursuit Dynamics – Suggested as a buy at 223p: the stock closed yesterday at 385p, a 72 per cent gain. The stock received another upgrade from broker Cenkos who expect to see the shares at 1000p by December 2011.
United Utilities – Buy idea suggested at 593p: the stock closed yesterday at 571.5p. The stock is worth holding for the six per cent dividend yield alone, but one also might expect some excitement regarding M&A activity within the sector.
Bodycote – Buy Idea suggested on 28 July at 236.4p: the stock closed yesterday at 249.6p. If the stock closes above 260p, add to the position.
The material for this report comes from Alpha Terminal. The writer does not hold any shares or derivatives in the above mentioned companies.
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