Van Eck Associates Corp. announced it has purchased a 10% stake in the common stock of Sibanye Gold (SBGL, Financial), which represents approximately 219.6 million ordinary shares of the South African gold mining company. Shares of Sibanye-Stillwater are expected to jump on the heels of the announcement.
On Thursday, Sibanye-Stillwater closed at $3.90 a share, down almost 1.02% at the end of regular trading hours. The stock lost 55% for the 52-weeks through March 22 and underperformed the Van Eck Vectors Gold Miners by about 49%.
Other indicators on Sibanye-Stillwater:
· Market capitalization is $2.06 billion.
· The stock is slightly below the 200, 100 and 50-SMA lines.
· The Relative Strength Indicator (RSI 14-days) is 39.41 of a 30 to 70 range.
· The price-book (P/B) ratio is 1.03 times versus an industry median of 2.06 times.
· The EV-to-Ebitda ratio is 37.40 versus an industry median of 9.90 times.
· The Ebitda margin (ttm) is 2.81% versus an industry average of 24.9%.
The recommendation rating is 3 out of 5. This is the result of two buys and one hold recommendation.
One analyst assigned a price target of $5.25 per American Depositary Shares of Sibanye-Stillwater.
As of March 13, Sibanye Gold has a total volume of 2,178,647,129 shares issued and outstanding or about 544.66 million American Depositary Shares. Of the total amount, 14.02% refers to the institutional ownership, according to GuruFocus.
Among the top institutional holders of Sibanye-Stillwater, the Van Eck Associates Corp. is its top owner. Its second largest shareholder is Exor Investments with a 5.4% interest stake in the South African gold producer. Exor Investments is controlled by the Agnelli family, owner of the Fiat Motor Company.
Over the last ten days of trading, the company also reported
- A sale transaction of performance shares made by CFO Charl Keyter mainly for associated tax liability settlement purposes. Those were bestowed to the chief financial officer of Sibanye Gold under the company’s 2013 share plan. Keyter sold 144,869 shares at an estimated $0.96 share price on March 15. Performance shares represent a form of stock compensation. Those are common shares a company gives to its executives and managers when the company meets its performance targets. One of these wide ranging targets can be, as one example, when the company manages to meet its guidance on earnings.
- A confirmation of Sibanye-Stillwater's full commitment in the deal with Lonmin Plc (LMI), which should take place sometime during the second part of 2018. Sibanye-Stillwater CEO Neal Froneman said that the “transaction remains in the best interest of stakeholders and will create a leading mine-to-market producer of PGMs in South Africa.” Lonmin Plc is a British platinum group metals producer and operates in the South African Bushveld Complex. The common stock in Lonmin is publicly-traded on the London Stock Exchange.
(Disclosure: I have no positions in any security mentioned in this article.)
