Endeavour Group Limited (ASX: EDV)

EDV is an Australian company, engaged in the drinks retail and hospitality businesses in Australia. It operates retail drinks network across Dan Murphy’s and BWS stores, and a portfolio of licensed hospitality venues. The company was incorporated in 2012 and headquartered in Surry Hills, Australia. The market capitalization stood at $12.37 billion at $6.920 per share.

Operational Update – on 1^st July 2021, the company announced the successful demerger from its parent company, Woolworths Group Ltd. (ASX: WOW) resulting in one share of Endeavour Group for one share of Woolsworth. The company was added to the S&P/ ASX 200 Index and commenced trading on 24^th June 2021. The company is yet to report its standalone trading updates, which will give the investor a clear picture of the prospects from the investment point of view, along with other stakeholders.

Technical Analysis- The stock was listed on 24^th June 2021, hence there is a very lited set of price data to perform technical analysis. The support can be found at $6.52, and the prices are at the life high at $6.950, hence the resistance is not viable on the charts. 

Since the company is recently listed with not much financial history and lack of data to perform technical analysis, we give the stock the rating of ‘Avoid’ at the closing price of $6.920, up by ~0.144%, as of 9^th August 2021.

Daily Technical Chart – EDV

Source: REFINITIV

Pantera Minerals Limited (ASX: PFE)

PFE is engaged in the exploration and development of mineral properties in Australia, primarily exploring iron ore, copper, manganese, and polymetallic deposits. The company holds an 80% interest in the Yampi iron ore project comprising one granted exploration license, as well as holds an option to acquire 100 % interest in the Yampi copper and Yampi Extension projects located in the Buccaneer Archipelago of the Kimberley Region of Western Australia. The company was incorporated in 2020 and is headquartered in West Perth, Australia. The market capitalization stood at $25.18 million at $0.330 per share.

Financial & Operational Updates – On 3^rd August 2021, the company announced it was admitted to the Official List of ASX Ltd and commenced trading with the raised capital worth $7 million from its fully paid ordinary shares. There are no other financial updates from the company as of now. It should be mentioned that the company made a net loss of $42,209 for the period from the date of incorporation till March 31, 2021.

Technical Analysis- The stock starts trading on 5^th August 2021, hence there is a very lited set of price data to perform technical analysis.

Since the company is recently listed with not much financial history and lack of data to perform technical analysis, we give the stock the rating of ‘Avoid’ at the closing price of $0.330, down by ~9.590%, as of 9^th August 2021.

Daily Technical Chart – PFE

Source: REFINITIV

Arafura Resources Limited (ASX: ARU)

ARU is engaged in the exploration and development of mineral properties in Australia, covering rare earth deposits, as well as tungsten, copper, and vanadium deposits. Its principal project is the Nolans project, a rare earths-phosphate-uranium-thorium deposit that supplies neodymium and praseodymium products located in Northern Territory, Australia. The company was incorporated in 1997 and is based in Perth, Australia. The market capitalization stood at $175.03 million at 0.125 per share.

Financial & Operational Highlights –   On 30^th June 2021, the company released its quarterly activities report, stating the update on its project, Nolan’s ultra-lower operating cost to the US $24.76/KG NdPr oxide and achieved robust financials with NPV of $1.4 Billon which is computed on the life expectancy of the mine of 38 years. Further, the company got the support for its Nolans Project with non-binding and conditional letter of support from Export Finance Australia (EFA)  for $200 million and Northern Australia Infrastructure Facility (NAIF) for $100m with a 15-year term. On the financial front, the company did not receive any cash receipts from the customers for the past 12 months ending on 30^th June 2021. The cash balance was decreased for the period ending on 30^th June 2021 to $10.78 million from $12.91 million in 3Q FY21.

Technical Analysis- The stock showed a strong uptrend and printed the recent high of $0.30, only to experience a sharp sell-off from those levels. Since then the stock is in a continuous downtrend, forming lower highs and lower lows. The relative strength index at 43.766, which is in the middle range of the zone, points for directionless movement, which can eventually lead to a breakout on either side. The 21 days simple moving average is hovering close to the stock price at $0.127,    indicating a lack of trend confirmation from current levels. For the prices to prohibit from diving into the bear territory, the support of $0.1050 should be held firmly. Similarly, for the prices to regain the uptrend, a resistance of $0.16 needs to be taken off with strong volumes.

Due to the lack of operating revenues, declining cash balances, accompanied by downward stock prices, we give an 'Avoid' rating on the stock at the closing price of $0.125, down by ~3.847%, as of 9th August 2021. Below the support levels mentioned above, we consider the stock to be a risky proposition and the prices may decline further. 

Daily Technical Chart – ARU

Source: REFINITIV

Auroch Minerals Limited - (ASX: AOU)

AOU is an Australian based company engaged in the exploration and development of mineral properties covering copper, cobalt, nickel, gold, zinc, and lithium ores. The company holds a 100% interest in Arden, Bonaventura, and Torrens East Copper projects, located in South Australia and  It also owns a 100% interest in Saints Nickel and Leinster Nickel projects situated in Western Australia. The company was incorporated in 2011 and is based in West Perth, Australia, having a market capitalization is $53.72 million, at the current price of $0.185 per share.

Financial & Operational Highlights – on 29^th July 2021, the company announced the result of drilling across its Nepean Nickel Project, confirming the presence of high-grade Nickel mineralisation across the site. From its other projects, Leinster Nicle Projects and Arden Copper-Zinc project, the drilling results were encouraging and further progress is going on in terms of drilling. On the financial front, the company did not receive any cash receipts from the customers for the past 12 months ending on 30^th June 2021. The cash balance declined to $3.07 million for the period ending 30^th June 2021 from $4.40 million for the quarter ending 31^st March 2021.

Technical Analysis- The stock exhibits an extremely volatile nature, forming a wide range of highs and lows, and gradually turning into a downtrend. The relative strength index at 45.997, which is in the middle range of the zone, points for directionless movement, which can eventually lead to a breakout on either side.  The 21 days simple moving average is hovering above the stock price at $0.197, indicating some more bearishness for the stock at current levels. The support for the current trend is at $0.125 and the resistance is at $0.255. Breaking either side of the range will give a clear picture of the trend formation.

Lack of operating revenues, declining cash balance, and stock prices heading towards the south make the stock less attractive from an investment perspective. Hence, we suggest investors to 'Avoid’ the stock at the closing price of $0.185 per share, as of 9^th August 2021.

Daily Technical Chart – AOU

Source: REFINITIV

Riversgold Limited (ASX: RGL)

RGL is a gold exploration company, engages in the exploration and development of mineral resource properties in Australia and the United States. The company holds interests in the South-west Alaska project located in the southern Kuskokwim Mountains of southwestern Alaska; and the Kurnalpi project located in the Eastern Goldfields of Western Australia. The company was incorporated in 2017 and is based in Subiaco, Australia, with a current market capitalization of $14.54 million at $0.036 per share price.

Financial & Operational Highlights - On  30^th July the company released its Quarterly activities report, stating its technical success from the drilling activities across its Queen Lapage project. the company received $0.34 million from the sale of Alaskan assets. On 7^th July 21, the company appointed Mr Julian Ford as its CEO, who is expected to drive RGL’s exploration activity and the Kurnalpi Project in Western Australia. On the financial front, the company did not recover any cash receipts from customers for for the past twelve months ending 30^th June 2021. The cash balance decreased to $0.29 million for the period ending 30^th June 2021 from $1.25 million for the quarter ending 31^st March 2021.

Technical Analysis- The stock exhibit slight volatility and hovering around the support zone ranging between $0.030-0.025. The relative strength index at 50.784, which is in the middle range of the zone, points for directionless movement, which can eventually lead to a breakout on either side. The 21 Day Simple Moving Average is currently hovering below the stock price at $0.036, indicating more bullishness on the stock from current levels. For the prices to regain the uptrend, a resistance of $0.045 needs to be taken off with strong volumes.

Lack of operating revenues, declining cash balance, and volatile stock prices, makes the stock less attractive from an investment perspective. Hence, we suggest investors to 'Avoid’ the stock at the closing price of $0.036 per share, as of 9^th August 2021.

Daily Technical Chart – RGL

Source: REFINITIV

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 for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.

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 the uptrend may take a pause due to profit booking or selling interest. 

The Green colour line reflects the 21-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Purple colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

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