Greatland Gold Share Price Forecast August 2021 – Time to Buy GGP?
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Shares of gold-copper exploration and development company Greatland Gold (LSE: GGP) are currently trading up 6.09% at around 16.90p. The share prices have suffered a steady decline since July where it was 19.18p at one point. It has fallen more than 50% since the beginning of the year but has returned 28% during the same period.
Greatland Gold – Technical Analysis
According to Greatland Gold’s financial statement, the market cap at the moment is at £632.598 million with total assets worth £9.936 million. The company reported a net loss of £5.14 million for the year.
Moving averages for Greatland Gold such as Exponential Moving Average (100)(19.42), Simple Moving Average (100)(19.55), Exponential Moving Average (200)(19.92) and Simple Moving Average (200)(23.0) are showing a strong sell action. Oscillators for Greatland Gold such as Relative Strength Index (14)(43.39), Stochastic %K (14, 3, 3)(20.96), Commodity Channel Index (20)(−53.98) and Average Directional Index (14)(14.83) are all neutral.
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Recent Developments
Greatland Gold has enjoyed a very good 2020 where prices surged 1800%. However, the shares have fallen by nearly 50% in 2021, year-to-date. Greatland Gold’s shareholding structure does not have many shares held by hedge funds. UBS investment Fund Managers Limited owns about 8.7% of the outstanding shares which makes it the largest shareholder. 50% of the company’s total shares are held by 23 of the largest shareholders. This means that no single shareholder can wield substantial control over the company. About 45% of the company’s shares are publicly owned. Last week, the company announced the appointment of Otto Richter as a group mining engineer, effective from August 16th. Richter has more than 20 years of experience as a group mining engineer and has held key technical and operational positions with multiple companies in Australia and elsewhere.
As a company, Greatland Gold doesn’t face issues such as time and money constraints. The time and money that a mining company requires for exploration cannot be fulfilled if there aren’t any credible backers to inject funds. However, Greatland Gold is unaffected by risks associated with early-stage mining. The company has partnered with one of the world’s largest gold miners, Newcrest Mining to create Havieron, its flagship gold asset. Both the companies have the money and experience to push their future prospects forward. Havieron is believed to hold 4.2 million ounces of gold, estimated to be valued at £5.58 billion(approx.) However, this means that the company’s valuation is solely based on the speculation that the project will become successful in the future.
Should You Buy GGP Shares?
Investors interested in GGP shares should consider the following. While Havieron is a world-class mine with immense potential, its investors will only be able to reap rewards when its producing gold. However, they will have to wait till the project reaches that stage. Investors shouldn’t take the successful development of the mine for granted. Any potential fallout between Greatland and Newcrest can jeopardise the joint venture. A sudden decline in gold prices may also cause GGP shares to plummet in the long term. Considering all of the above factors, investors holding GGP shares should consider holding on to them longer. There is a high chance that the shares might continue to slide till the time production starts. Investors planning on buying GGP shares should wait for news regarding production before buying them.
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