RonS, nice update on B2Gold, I bought some more of it. I like your Conclusion
<b>Conclusion</b>
B2Gold is fully financed to complete their Fekola plans and completion of the Goose mine. As of June 30 financial s they had $467 million in cash and no debt. They also have available an undrawn credit facility of $700 million.
The negative factors on total gold production and costs will all vanish in late 2024 so 2025 will be a very good year. And production will grow further in 2026 as the Goose project has a full year effect. It is a high grade low cost mine.
<p align=”LEFT”>Also piled into 2024 is the total consolidated all-in sustaining costs per ounce reflect the final full year of spending on both the new Fekola Tailings Storage Facility (“TSF”) and the Fekola solar plant</p>
expansion, in addition to the ongoing substantial capitalized stripping campaign planned at Fekola for 2024.
A metric I often use is the enterprise value of ounces of gold in the ground. B2Gold has a total M&I resources of 19.6 million ounces. They have US$467 million cash and 1,311 million shares at US$3.30 = $4,326 Market Cap – $467M cash= $3,859 = US$197/ounce.
In 2022 Kinross acquired Great Bear Mining for US$1.8 billion. There was no resource number at that time but the recent Kinross PEA says 2.74M oz M&I resource for a value around $650 per ounce based on the 2022 buyout.
Very recent, Osisko’s (OSK) 50% of Windfall is being bought by Gold Fields for C$2.16 billion – $300M cash values the gold at C$1.86 billion or about US$1.37 billion. Osisko’s Windfall project has 4.1 M ounces M&I, so 50% of that is 2.05 million ounces. That takeover values those ounces at US668 per ounce.
Granted, these are both high grade projects selling for around $650 per ounce. I believe that B2Gold’s ounces for a producing company should be way higher than $197 per ounce. Should at least be double that.
I mention Kinross here and they produce about 2.1 million ounces per year and similar AISC as B2Gold of $1,360/oz. Kinross has 25.96 million M&I resources and a market cap of $11.5B + (1.23B debt less .48M cash) .75M = $12.25B/25.96 = US$472/ounce valuation.
The stock has languished with these over hanging issues and is not fully pricing in a turn around for 2025. The recent downward trend (blue lines) driven by the previous negative fundamentals appears to be broken and with a higher high this week. We also have a nice double bottom in 2024. The stock is a long way from it’s 2020 highs and I see $6 as a minimum target for this year/early 2025.
