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It’s been a rollercoaster ride for shareholders of Hummingbird Resources (LSE:HUM) over the past year. The share price has more than doubled from 10p to 22p since this time last year, but has fallen back sharply in recent months on the back of weak gold prices. However, with the shares now trading on a forward P/E ratio of just 5.5, it could be worth taking a closer look at this struggling miner.
It is no secret that the share price of Hummingbird Resources has taken a beating over the past year. The stock is down almost 60% from its 52-week high, and many investors are wondering if now is the time to buy or if they should wait for further weakness. I believe that now is a great time to start building a position in this undervalued company.
Here are three reasons why:
1) The balance sheet is strong. Hummingbird ended 2018 with $43 million in cash and no debt.
This gives them plenty of financial flexibility to weather any storms that may come their way and continue investing in their two main projects (Yanfolila in Mali and Tengratila in Peru).
2) Production is ramping up at Yanfolila. After some delays, production finally started at Yanfolila in December 2018 and has been steadily increasing since then.
With all major construction now complete, we should see production costs start to decline, which will boost margins going forward.
3) Tengratila remains on track for first gold pour in Q4 2019. While Yanfolila ramps up, construction continues at Tengratila on schedule.
First gold pour is still expected by the end of this year, which should provide another boost to earnings next year.
Overall, I believe Hummingbird Resources offers an attractive risk/reward proposition at current levels.
Hummingbird Resources (CVE:HUM) is a Canadian junior mining company with two gold projects in Mali, West Africa. The company’s flagship asset is the Kouroussa Gold Mine, which is currently in production.
Shares of Hummingbird Resources have been on a tear in recent months, and are up over 400% since November 2016.
The stock has been boosted by strong operational results from the Kouroussa mine, as well as increasing investor interest in West African gold miners.
With a market capitalization of just CAD$85 million, Hummingbird Resources is a small-cap stock that offers investors exposure to high-growth gold mining operations. The company also has significant upside potential if it can continue to execute on its plans and bring its second gold mine into production.
Credit: fraimed.co.uk
Hummingbird Resources is a gold mining company with operations in Liberia and Burkina Faso. As of July 2020, the company’s share price was 0.42 GBX.
Hummingbird Resources’ share price has been on a roller coaster ride over the past few years. The company’s shares were trading at around $0.50 in early 2014, before skyrocketing to over $2.00 by mid-2015 on the back of strong gold production from its Yanfolila mine in Mali. However, Hummingbird’s share price then came crashing down after the company ran into problems with its Tuvatu project in Fiji, and it was trading at just $0.30 per share by early 2016.
Since then, Hummingbird’s stock has recovered somewhat and is currently trading at around $0.70 per share. This is still well below the company’s peak share price of over $2.00, but investors seem to be optimistic about Hummingbird’s future prospects as it continues to ramp up production at Yanfolila and looks to bring Tuvatu online later this year.
Hummingbird Resources (LSE:HUM) is a gold mining company with operations in Liberia and Burkina Faso. The company listed on the London Stock Exchange in 2010 and has a market capitalisation of £111 million as of December 2017.
The main factors that could affect Hummingbird Resources’ share price in the future are the gold price, operational performance and political risk.
The gold price is highly volatile and sensitive to economic conditions. A fall in the gold price would negatively impact Hummingbird’s share price as it would reduce the profitability of its mines. Conversely, a rise in the gold price would be positive for Hummingbird as it would increase profits and cash flow.
Operational performance is also crucial for Hummingbird. The company has had issues with its Yanfolila mine in Mali in the past, which led to lower than expected production and increased costs. If Hummingbird can ramp up production at Yanfolila and keep costs under control, this will be positive for the share price.
Finally, political risk is always a factor to consider when investing in Africa-focused companies like Hummingbird. Countries such as Liberia and Burkina Faso are relatively stable at the moment but this could change quickly if there are any major political or social upheavals. Any deterioration in the security situation could lead to disruptions at Hummingbird’s mines and put downward pressure on the share price.
Conclusion
Hummingbird Resources is a gold mining company with a strong share price performance. The company has had a good year, with its share price rising significantly. Hummingbird is a well-managed company and has a strong track record in delivering shareholder value.
The company is debt-free and has significant cash reserves. It is also expanding its operations, which should support future growth.