It’s been an ugly year and most are truly fed up with the markets and the global woes. There’s no magic wand unfortunately and you have to take the rough with the smooth. After 2 bullish years in 2009 and 2010, small cap commodities performed well off their respective lows.
The big question is – will the small cap commodity sector perform in 2012?
Well, it’s that time of year again when thesharehub invites readers to submit and share their recommendations for the 2012 list.
The format will be the same as previous years with 10 stocks forming the Hotlist. However, for 2012 there will be two different lists. Instead of having 2 x commodity heavy hotlist picks, there will be one Hotlist for commodities and a second B-list which will focus on a mix of sectors. The latter will be more comparable to the newspaper stock picks where sector breadth is always a crowd pleaser.
A full summary of the 2011 Hotlist results will be issued around Jan 2nd 2012 with the new 2012 Hotlist (and B-list) being issued shortly after.
Commodities may have exited 2010 on a high, but it looks fairly certain many will exit 2011 on lows. That might in itself be a good reason to look at bottom picking especially if the broader markets show a new verve in 2012.
Please keep comments related to this thread if possible as it’s easier for everyone to follow. If your comment or post does not show up in the comments section immediately – don’t worry, give it time – it will appear.
Hi Hub,
Have a look at GDP (Goldplat) – one that won’t have been mentioned at all.
SP 10.75p, Mkt Cap £18mln, 10p placing of 55 mln shares in Dec 2010, money used to purchase mining leases and fund exploration at 2 major new sites in Burkino Faso and Ghana, plus has just succesfully received final govt lease/sign off for gold project in Kenya.
Another gold explorer?
What makes this stand out is that it already has in the background profitable gold recovery operations in Ghana and S.Africa separate to the new sites (28k ozs in 2011, up from 21k in 2010) which in the last year made a net profit of £3.4mln (inl £425k exceptional gain), £1.95 mln in previous year. No debt, has net cash of £3mln. There appears to be no need for fund-raising with existing operations funding growth, the placing in Dec 2010 was to fast-track the 3 exploratory/production operations
This is all before the main aim of becoming a mid-tier producer by looking to raise it’s jorc defined resources to c. 1mln ozs by end of H1 2012 (from the 3 projects above).
The kenyan project has concentrate stockpiled (whilst they awaited the final lease – received in Nov), the elusion plant is 90% completed and first pour is expected in Jan worth c. $2.4 million, and look to produce 10k ozs this year.
Add to that the Kenya project has 129k ozs Jorc already and with further exploration they believe they can get this to 500k ozs by Q 2012.
This may not be a £billion company in the making, but at 10.75p and a mkt cap of £18mln (heavily underwritten by existing profitable operations) and with the Kenyan project coming online to add to production in Q1, plus the 2 other exploratory targets 2012 really could/should be Goldplat’s – could be excellent timing for 2012 hotlist.
Well worth a look.
Cheers
Harry
P.S. Also take a look at RMM – copper and gold play with operations based in Newfoundland. Has just brought own mill back into operation, has a copper concentrator and gold hydrometallurgical facility so can switch production of either gold rich or copper rich ore from it’s various mining zones depending on metal prices. Placings completed last year, now has a debt facility in place, so appears no need for fund-raising. At 26p, a mkt cap of c£33mln looks good for 2012 either if copper price rebounds or if money-printing continues and gold moves up.
SLE
My hot list for 2012
CRND
CHAR
SXX
BAO
Considering how close FML are to produciton and with the funding to get there 2012 should be FML’s year as the current disconnect between the sp and near term earnings can’t be ignored indefinately. looking good also
are:
CHAR
AST
HMB
OPHIR
MXP
Hello Hub,
If I need to pick one, i def would say Kefi Minerals.
Have a look what happened the last month and more news on its way.
Wishing everybody a happy Xmas and a fantastic, but above all healthy 2012.
Commodities:
Metminco (MNC). Copper play, nicely post IPO with takeover potential. Global recession priced in, but cars and computers (inc Apple products) will still sell.
Ophir (OPHR). Oil. Big drilling programme in 2012, FTSE 250 (so maybe less manipulation) and the benefit of Dominion’s assets
Other sector
Blinkx (BLNX). Volatile and associated with Autonomy’s take out – but in a youthful high tech sector.
1. Plexus Holdings (POS)
2. Patagonia Gold (PGD)
3. Enquest (ENQ)
2012 tips
BZM
JLP
BZT 35p divi current share price 28p!
AAZ
FTO
MXP
Judging by the drop on aim over the recent months and the possibility of further drops it looks like we may have some multibag possibilities by the start of 2012. The oil industry has taken some big knocks lately but with all analyst pointing to the future rise in the oil prices they look like the best bet. However I have tried to vary my choices, here they are.
CHAR – Just a delay before lift off
FOGL – Rig arrival will signal surge
BLVN – Resources will be proved up
KMR – Mine full capacity in 2012
TCG – Just will not be let down by backers
ZOO – Technology will be proved eventually
RRL – Puntland is the maker
SXX – Massive resources
XEL – First oil will see the SP rise
AFR – Kurdistan oil laws will see this surge
Angel Biotech
Bezant Resources (likely dividend greater than current sp)
Edenville Energy
Herencia Resources
Max Petroleum
Ortac Resources
Pan African Resources
There should hopefully be a few multi-baggers out of these lot next year……
CHAR
VOG
AST
MXP
BLVN
AEX
CAZA
SLE
XEL
VPP
Hi Hub
My picks for 2012, for what its worth are…..
MXP
BLVN
BHR
RRL
CAZA
Thanks and GOOD LUCK to everyone.
Have a Happy and Prosperous 2012
Re 2012 list
I see the following doing well
Petroceltic
Zoltav
Sirius Petrol
Afren
Heritage
Gulf Keystone
It could be another difficult year but here are six oilies to follow in
2012
Antrim Energy AEY
Soco SIA
Nautical NPE
Premier Oil PMO
Salmander SMDR
Enquest ENQ
Congratulations on the many well informed posts Hub.
I notice a lot of the picks for the 2012 hotlist listed above have been private investor favourites for several years and have featured in previous hotlists.
With these AIM commodity plays, it always tends to be a case of jam tomorrow. The promises are all to often big and the delivery small.
Just look at the relative performance of the AIM O+G and mining exploration stocks. Performance is dreadful.
Judging by the performance of AIM and small cap commodity stocks, it is probably fair to say it’s the wrong area to look for big % gains as all to often they fail to deliver.
The problem is all to often, small cap commodity players find a resource which is just about viable. However, because of this no bigger player wants to buy the resource and it is difficult to secure funding. Instead said company goes on promising monitising the resource but this takes years.
People forget the time value of money and while it may be good fun holding AIM commodity stocks waiting for that future oil field/ mine to come on line. The irony is better returns could probably had from a FTSE100/250 tracker while re-investing dividends.
I feel I’ve learnt the hard way. Yes there are some success stories of AIM, Afren, GKP, Asos. But they are few and far between. That is what draws me away from the small cap commodity firms and pushes me towards sectors where performance and delivery can occur in the short term.
For this reason I would look towards more niche markets/ products.
So based on the above, my pick is Monitise (MONI).
As stated, there will be two lists in 2012. One (the hotlist) will be commodity focussed and the other (b-list) will this time be focussed on a mix of sectors.
If small cap O&G successes were ten a penny, then the market wouldn’t be as it is. High risk stocks often carry high growth potential. But the key is to find the high potential stocks and gain entry at a point where they are supported by current operations etc. The likes of Desire (DES) etc which are more based on drill and succeed or drill and fail – are far more risky than the likes of MXP, NPE, IAE or Afren etc. The latter are cheap based on their existing business/assets.
QE normally sees commodities doing well, hence in 2009 and 2010 – returns were very strong.
Top of the pops GKP(unless the much discussed possible T/O actually happens.
Then Char
Mxp
Xel(could’nt be any worse than 2011)
Agq
Cza
Bhr
Wti
I think max petroleum (mxp) will be the highlight of 2012
OTC
MXP
XTR
BPC
GKP
Moni
FOGL
GKP
HER
HUM
Well here is the hot stocks for the Hotlish Hub
fogl
Bor
Chariot oil
BPC
Trp