«managements» bernhard graf portfoliomanager amg gold – mines & metals fund march 2014
TRANSCRIPT
Portfolio management – stocks selection
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Technicals: Charts, Momentum, Relative Strength, Trends
Fundamentals: much more complex criterias!- Large- or small-cap / market liquidity- Valuations: P/NAV, costs, balance sheet, grades- Risk: technical, financial, permitting, sovereign, personnel- Managements:
consistency, track record strategy & execution, business plan, cost control Values continua delivering on forecasts failure experience what have they learned?
Portfolio management – stocks selection
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Knowing the Managements, for the stocks selection, is very important to make the right investment decision
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Basic Challenges for Managements
Market/BusinessEnvironment
EmployeesRecruiting
Shareholders
Regulatory/Environmental standards
Executives (CEO/CFO)Board
Stock Price !!!
Large versus Small Caps – significant difference for shareholders
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Shareholder influence
Diversification / Structure
Flexibility / adopting changes
Cost efficiency / cost synergies
Values Continua
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Trustworthy
Loving
Courageous
Dignifying
Honest
Fair
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Untrustworthy
Unloving
Cowardly
Disrespectful
Dishonest
Unfair
Source: Denver Gold Forum 2013, Zurich
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Goldcorp (G CN) relative to XAU-Index (last 3 years)
March 2014, Source: Reuters / AMG
Company was withstanding shareholder demands to leverage their cash in 2011
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Randgold Resources (GOLD US) relative to XAU-Index (3 years)
March 2014, Source: Reuters / AMG
Only builds projects with an IRR >20% with a gold price calculation at USD 1’000
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Franco Nevada (FNV US) relative to XAU-Index (3 years)
March 2014, Source: Reuters / AMG
A business model, which obviously works very well
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Argonaut (AR CN) relative to XAU-Index (4 years)
March 2014, Source: Reuters / AMG
Perfectly run company with low grades in Mexico
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Pilot Gold (PLG CN) relative to XAU-Index (3 years)
March 2014, Source: Reuters / AMG
Management track record Fronteer Gold
Pilot Gold – PLG CN
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Turkey TV Tower, Halilaga; Nevada Mount Kinsley«Sience of discovery» means generally higher grades
Experience in Turkey with «Agi Dagi» & «Kirazli» (Alamos Gold)Nevada with «Long Canyon» (Newmont Mining)
Identical Management Team as with Fronteer Gold (Track record)
Market Cap: CAD 145mln
Key message
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Be critical but fair with managements
Sending a lot of companies home without money should not leave you with bad feelings
Management meetings will help you with a better stocks selection
Investing in good managements gets rewarded with good share price performances