Argosy Minerals Limited

Argosy Minerals Limited (ASX: AGY) was incorporated in 2010. It is involved in developing its flagship Rincon Lithium Project and exploration of the Tonopah Lithium Project.

Financial & Operational Updates – On 11 January 2022, the company highlighted the further progress at the Rincon Lithium Project, located in Salta Province, Argentina, with plant and equipment manufacturing, procurement, and delivery works proceeding to develop the 2,000tpa lithium carbonate production operation. On 4 January 2022, the company highlighted that 53% of the total works at the Rincon Lithium Project had been completed to develop the modular 2,000tpa lithium carbonate production operation. The company remains on schedule to achieve the first production of >99.5% battery quality lithium carbonate product from mid-2022.

In September 2021 quarter report, the company highlighted that renewable solar energy to power Rincon’s clean lithium technology with low energy use & raw water consumption for a low emissions / low carbon footprint operation. The projects 2,000tpa process plant design & engineering layout works has been completed. The Company is in a strong financial position with cash reserves of ~$22.8 million. During the quarter, the total expenditure of ~$4.35 million was provided to Puna Mining to fund the continued development works at the Rincon Lithium Project. Exploration and evaluation expenditure conducted during the quarter was ~$180,000.

Technical Analysis

Daily Price Chart

Note: The purple color line in the chart depicts RSI (14-period). The sky-blue and green color lines represent 50-Period SMA and 21-Period SMA respectively.

On daily chart, AGY's stock price has been on a tear for a long time and is currently trading at a 52-week high hence indicating higher level of risks associated with the stock. However, bearish divergence on the RSI causes the same price to be traded with caution because a severe correction can occur at any time at greater levels. The stock's next significant resistance level is now at AUD 0.45, followed by 0.48, and the stock's major support levels are at 0.355 and 0.335 zones. The support levels may present a promising opportunity to profit from the upward momentum. On the daily chart, the RSI (14-period) is currently trading at 74.97, indicating that the stock is approaching its overbought zone.

Stock Recommendation

The lithium market continued its resurgence, with lithium demand and prices increasing, with most lithium pricing benchmarks growing over 100% during the quarter. A driving factor for these increases have been rising global lithium demand from new electric vehicle manufacturers against supply shortages in China and an increasing cost base.

Therefore, considering the facts above and the current trading levels, we give a “Watch” recommendation on the stock at the closing market price of A$0.400 per share, up 2.564% as of 11^th January 2022.

Pro Medicus Limited

Pro Medicus Limited (ASX: PME) provides a range of radiology IT software and services to hospitals, imaging centres and health care groups worldwide.

Financial & Operational Updates – On 22 October 2021, the company published its annual report highlighting that revenue from contracts with customers in FY21 stood at $67.88 million, compared to $56.82 million in the previous year. Profit for the year stood at $ 30.85 million, compared to $23.08 million in the last year. At the end of the period, cash and cash equivalents stood at $42.04 million, compared to $43.41 million in the previous year.

On 1 October 2021, the company highlighted that its wholly-owned U.S. subsidiary, Visage Imaging, Inc., has signed a $40M, 7-year contract with Novant Health, Inc. Based on a transactional licensing model, the agreement will see the company’s Visage 7 Enterprise Imaging Platform and Visage 7 Workflow module implemented throughout Novant Health, providing a unified diagnostic imaging platform across the network.

Technical Analysis

Daily Price Chart

Note: The purple color line in the chart depicts RSI (14-period). The sky-blue and green color lines represent 50-Period SMA and 21-Period SMA respectively.

On daily chart, PME's price has suffered a major correction after encountering numerous resistances at higher levels, breaking the 200-SMA on the daily chart indicating higher level of risks associated with the stock. The stock's next major support level is AUD 45.75, followed by AUD 41.33, and prices may test this level, while the stock's main resistance levels are AUD 58.35, followed by AUD 62.50. On the daily chart, the RSI (14-period) is at 29.83, indicating that the stock is approaching its oversold zone.

Stock Recommendation

The company anticipates that the 2022 financial year will crystallize more opportunities due to improved prospects in North America for Visage 7.0 (PACS) and the continued commercialization and rollout of Visage RIS’s new technology RIS platform. However, its stock is on a free-fall.

Therefore, considering the facts above and the current trading levels, we give a “Watch” recommendation on the stock at the closing market price of A$49.90 per share, down 5.17% as of 11^th January 2022.

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on the investors’ appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the analysis has been achieved and subject to the factors discussed above alongside support levels provided.

Technical Indicators Defined:-

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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