Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
Hi James and crew, What's your latest thoughts on Regis Resources RRL? Their most recent reports are mostly positive and the relatively minor negatives such as their hedge book and increased operating costs don't seem to justify their sub-$2.00 price. Is there something about the company that isn't obvious that can explain the huge fall in their share price? Thanks for any advice you can provide. Bernie
Hi Bernie,
RRL has been the major underperformer within a struggling sector, most definitely not a great combination. The stocks been falling hard since mid-2020 which looked justified when the company announced a 27% plunge in profits for the FY21. The gold producer saw the drop in profits even on an 8% increase in revenue to $819mn, the problem being their all-in sustainable cost (ASIC) was higher in FY21 than in 2020 i.e. up from $US1246 to $US1372. While we prefer Newcrest Mining (NCM) in the Australian gold space, RRL is one of the cheapest gold stocks on the market and I know a top pick of our analyst Peter O’Connor.
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