Yes, I have added. I now hold 60% of my original shares. A bit nerve racking but it feeds our addiction.
A transcript of SWC CFO, Greg Wing's presentation was posted on Seeking Alpha a couple hours ago. I didn't see much in the way of new info, though, maybe others did. 2K traded as high as $16.51 after the bell.
One forward looking statement, which I already somewhat expected:
"Our recent guidance for capital is about $145 million to $155 million. Its -- I’m believing at this point that we will probably adjust that guidance down somewhat in the third quarter as well."
Hoping that the bottom has been set and that we'll enjoy an up day tomorrow.
My bender continues. I've been downing Oct. calls, with Nov. and Jan. chasers. Sure hope the hangover is manageable.
Are you adding?
SWC is not overvalued compared to any other precious metal miner.SWC would
been bought out years ago by Newmont but the onerous environmental rules scared
them and others away.
If SWC was 250 miles north, in Alberta , the Stillwater complex would be a major mining camp.
(In Alberta, my home, levelling a forest the size of 20,000 football fields is considered to have no environmental impact.!?)
On wed Barclay's raised their forecast price for palladium
And lowered their gold forecast.
No, SWC needs to stay as far away as possible from Pal. They've already done enough bone-headed, shareholder-value-destroying moves over the years. That cash on hand belongs to the shareholders, and is owed to the shareholders, and I hope they act soon on their promise to deliver on shareholder value.
Would actually make more sense for a Au miner to buy SWC to diversify. Maybe a Newmont (NEM) market cap 12B vs SWC mkt cap 2 B. Barrier to a takeover is IMO SWC high valuation.
Yeah, a little fuzzy how the mined annual supply of 6M oz gets to the end users. Swiss numbers are too small to get and idea of the real market flows. Are there brokered deals put together between between holders and users that public never sees?
"Exports were 35,700 ounces, with the bulk ounces headed to Japan, 15,600 ounces; Hong Kong, 11,700 ounces and Germany, 3,500 ounces. Imports came from Russia and the U.S. to total 21,200 ounces. ... Russian palladium exports to Switzerland were again 6,500 ounces, keeping the trend of the past few years, Barclays said."
Since I don't believe the SWC is shipping to JM via Switzerland, I'm not sure 14.5K ounce are coming from in the US. Banks or individual investors, perhaps. All the number seem pretty low to me. I get the sense that too much of a spotlight is being put on Swiss Pd data, as it once was much more meaningful to follow, when Russia was releasing stockpiles.
"NET exports" can be distorted by inflows - big inflows from one source (Russia?) cancel out exports to end users like JM. JM still needs more PD than SWC can supply for their cc and other Pd business.
In cases like this GROSS exports might be more meaningful. GROSS exports I would assume are going to endusers , imports from producers. Swiss just sort of act like a clearing house. YOu could have robust demand and 0 NET exports.
I read this on Kitco today, "Despite being a net exporter, Barclays said the August data shows Switzerland exported its lowest level of palladium in almost a year, with net exports falling by 71%. "
It made me wonder to what extent the take-off agreement with JM impacts the Swiss export data. If JM had been getting some of their Pd through Switzerland in the past, that could be a reason why exports fell. It might also be sending a misleading message.
The estimate of $1 is completely contingent on the price of Pd. You can't consider at forward PE in a mining company without also considering the underlying metals price -- there far too large of a variance.
Today seems way overdone, unless one thinks Pd is headed much further south.
I'm buying more Oct. options today -- and considering some Jan.
It may be the drop in Pd price but IMO it is that next year's EPS is estimated at $1.00. At at a forward P/E of 17 isn't that a little high for a company that has publicly stated that a sustained 10% is what they anticipate?
And a lot can happen in 15 months.
My replies keep getting lost.
The 30 was the only significant high interest debt.
There is also about 390M cv at under 1.75%. Don't know what the cv price is but they are selling at 141 so cv price must be around 12. There are callable so SWC could make this debt go away for 32M shares or so. Holders also have an option in 2019 but not sure exactly what they can do.
And 181M 1.875% - due date unclear.
So in terms of interest reduction, low hanging fruit has been picked.
A 1% div would cost them about $21M - easily doable given their 500M hoard, earnings and FCF.
The topic was also brought up in last quarters cc. I like the idea of their paying off things like 8% bonds, first. And maybe also making sure that there might not be better uses for cash prior to making a dividend or repurchase decision. You know, like buying a Canadian producer (just kidding).
Hard to guess what "medium term" means. Next year, maybe?
In response to a question about whether SWC would consider using the increase in cash in Q2 of $28 M to pay a dividend, McMullen relplied:
"Yes. Well, you will have noted, we paid off -- just after the quarter ended, we paid off $30 million of a bond that was costing us 8%. So we felt that, that was a very good no-risk return to us. It made a lot of sense. So even after paying it off, we still do have a significant amount of cash. I still would like to be in a position to return something to shareholders, probably in the medium term. But we haven't decided in what form that may or may not take. I would like to see how we go just with some of the operational changes that we're making at the moment to make sure that's all bedded in, and just see how much cash generation we can drive out of these operations. And then at that point, we can look to do something for shareholders I think."
I queried SWC mgt about return of capital that they mentioned in (YE?) cc.
"Thank you for your email and support of Stillwater Mining Company. It is the intention of management and the board of directors to return capital to shareholders in some form (including dividends or a share repurchase) at some point. When a conclusion is reached regarding these decisions, the Company will issue the applicable notification. "
So still on the table.
telll yer wife palladium takes all the hazardous exhaust fumes out of you.
helps keep the bedroom air clean !
There was more than one point that I took exception to in your post.
However, I share your optimism about SWC. So, so long as no one cares to get specific, who am I to disagree.
from things i've noticed
life in china seems to be cheap
because there are so many lives living in china
oversupply , so as in its wars
china is willing to sacrifice people more readily...