The S&P/ASX 200 Index (ASX: XJO) ended last week down 4.5%, the first weekly fall since the low of 23 March. It is now 15.3% above the March low but still 26.8% down from the February high (at the time of writing).
The coronavirus market meltdown was the most rapid in history, with the market falling 36% over 22 days in February and March. It took the market 16 months to fall 50% during the GFC.
The start of last week was marked by falls as oil prices turned negative. Virgin Australia Holdings Ltd (ASX: VAH) entered administration owing some $6.8 billion to creditors. Employment figures showed some 800,000 Australians have lost jobs since the country reported its 100th coronavirus case.
Investors began to take stock of the coronavirus-induced economic damage, causing share prices to fall. Business confidence is low, having plunged to -66 in March from -4 in February. Yet as Australia completed its fourth week in lockdown, hope that restrictions could be eased emerged.
Here are 5 ASX 200 shares that made major gains last week.
Pinnacle Investment Management Group Ltd (ASX: PNI)
Shares in Pinnacle Investment Management Group rose 12.2% last week to finish the week at $3.67. The investment management firm provides distribution and support services to affiliates that collectively manage $52.6 billion in assets.
The Flinders Emerging Companies Fund revealed it had added Pinnacle to its portfolio during the March quarter. Pinnacle performed strongly before the downturn and the fund has added to its position recently following a steep sell off. The fund says Pinnacle has an excellent suite of investment vehicles which gives it confidence in its future growth.
Pinnacle was recording strong growth prior to the coronavirus disruption. In 1HFY20 funds under management increased 13% from $54.3 billion at 30 June 2019 to $61.6 billion at 31 December 2019. Since then total funds under management have taken a hit due to asset price declines.
Pinnacle saw a significant increase in profitability in the first half, with profit of $13.8 million recorded, up from $10.10 million in the prior corresponding period. Initiatives in place to support future revenue growth include expanding offshore distribution, ETFs, and supplying services direct to retail customers.
Regis Resources Limited (ASX: RRL)
Regis Resources shares finished the week up 11.3% at $4.54. The Perth-based company benefitted from a strong rise in the gold price last week as investors sought safe haven assets.
The gold price started last week at $2,665 an ounce, surging to $2,720 per ounce on Wednesday, before settling at $2,700 at week’s end. Regis focuses on gold production and exploration with operations in Western Australia and New South Wales.
Regis is due to lodge its quarterly results this week. In its most recent half year results, the miner posted a record net profit of $93 million, up 17%. Production was on track to meet full year guidance of 340,000 to 370,000 ounces. At 31 December 2019, Regis Resources had cash and bullion of $169 million and no debt.
Evolution Mining Ltd (ASX: EVN)
Shares in Evolution Mining gained 9.3% last week to close the week at $5.18. Evolution Mining was another beneficiary of the rise in gold prices. Last financial year the miner produced 753,001 ounces of gold.
In its quarterly report released last week, Evolution reported production of 165,502 ounces of gold. This brings Evolution’s year-to-date gold produced to 528,359 ounces. For FY20, Evolution Mining has provided guidance of gold production of around 725,000 ounces and an all-in sustaining cost of $940–$990 per ounce of gold.
Evolution Mining also produces silver and copper. Silver prices have been on the rise of late, increasing from ~US$12 an ounce in mid-March to above US$15 an ounce currently. Copper prices have also increased from around US$2.10 per pound in March to over US$2.30 currently.
Silver Lake Resources Limited (ASX: SLR)
Silver Lake Resources shares climbed 9.2% last week, closing the week at $1.965. Silver Lake Resources is another gold miner that benefited from the flight to safe haven assets last week.
Silver Lake Resource’s cornerstone asset is the Mount Monger Gold Camp in Western Australia. In the March quarter the company reported record sales of 69,183 ounces of gold and 452 tonnes of copper. The average gold sale price was $2,170 per ounce with an all-in sustaining cost of $1,380 per ounce.
Mount Monger reported record mine production of 52,459 ounces in the March quarter, with 4,971 recovered ounces. Gold ore stockpiles increased by ~7,600 ounces to ~76,000 ounces. Silver Lake ended the quarter with cash and bullion up 22% to $227 million.
Following strong 3Q sales, Silver Lake has upgraded FY20 sales guidance to 250,000–260,000 ounces of gold equivalent (from 240,000 to 250,000 ounces). Group all in sustaining cost guidance remains unchanged at $1,300 to $1,350 per ounce.
Saracen Mineral Holdings Limited (ASX: SAR)
Shares in Saracen Mineral Holdings Limited closed the week up 5.3% at $4.40. Yet another gold miner to gain last week, Saracen recently announced record production was estimated for the March quarter.
Production of between 150,000 and 155,000 ounces is estimated for the March quarter. Production in the six months to 31 December was 216,452 ounces. FY20 guidance is for 500,000+ ounces.
Saracen has deferred discretionary expenditure including greenfields exploration due to the coronavirus pandemic. Its balance sheet remains robust. Cash and bullion of between $325–$330 million is estimated for 31 March (up from $239 million at December 2019). The miner has debt of $360 million and remains comfortably in compliance with financial covenants.
Saracen Managing Director Raleigh Finlayson said, “Saracen’s long standing strategy to future-proof the business offers a high degree of resilience to the risks and challenges posed by COVID-19, in particular the prudent build up of surface ore stockpiles for processing to the tune of 1.7 million ounces.”
5 stocks under $5
We hear it over and over from investors, "I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I'd be sitting on a gold mine!" And it's true.
And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!
*Extreme Opportunities returns as of June 5th 2020
Motley Fool contributor Kate O'Brien has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
- Cimic share price dips despite $2.5 billion contract win – July 10, 2020 3:13pm
- These ASX fintech shares are tackling COVID-19 head on – July 10, 2020 11:18am
- This ASX insurance share has proven resilient during the downturn – July 9, 2020 11:59am