AngloGold Ashanti conducts mining operations in Africa, North America, South America, and Australia, and undertakes exploration activities worldwide. The company is involved in the manufacturing, marketing, and selling of gold products, as well as the development of markets for gold.
While the company's recent half-year performance was a bit soft due to one-off costs and increased input prices, revenue benefitted from improved volumes and favourable pricing, with production being marginally higher. The stronger performance seen over the second quarter could provide momentum into the second half.
Technically, the share is displaying strong signs of price symmetry (see the black vertical line and the reference to the left side and the right side on the first chart) making it attractive as an investment opportunity. The forthcoming price movement is expected to mirror the previous trajectory, which in this case is a break toward the upside.
The share is testing its 200-day simple moving average (SMA) of ~R343. A break above this level will confirm the bullish trend and the share will be in a long-term uptrend.
Fading downside momentum according to the MACD indicator, and the recent upwards movement of the On-Balance Volume indicator (which suggests money is flowing into the share), supports our bullish stance.
Share Information
| Share code | ANG |
|---|---|
| Industry | Gold Mining |
| Market Capital (ZAR) | 143 billion |
| One year total return | 63% |
| Return year-to-date | 1% |
| Current price (ZAR) | 344.01 |
| 52 week high (ZAR) | 556.88 |
| 52 week low (ZAR) | 231.43 |
| Financial year end | December |
| Closing paragraph | While the share price has been under pressure since earlier this year, several technical indicators are suggesting that the recent upward swing will continue. |
Consensus expectations
(Bloomberg)
| FY22 | FY23E | FY24E | FY25E | |
|---|---|---|---|---|
| Headline Earnings per Share (ZAR) | 21.12 | 26.17 | 34.69 | 34.95 |
| Growth (%) | 23.87 | 32.59 | 0.74 | |
| Dividend Per Share (ZAR) | 7.70 | 5.40 | 5.66 | 8.43 |
| Growth (%) | -29.84 | 4.78 | 48.87 | |
| Forward PE (times) | 10.51 | 9.72 | 13.36 | |
| Forward Dividend Yield (%) | 1.63 | 2.24 | 2.55 | |
| Closing paragraph | Earnings growth is expected to remain robust in the medium term. | |||
Buy/Sell Rationale
Technical Analysis:
Long-term fundamental view:
| Share Name and position |
INL - BUY (Continue to hold) |
STXRES - BUY (Continue to hold) |
BTI - BUY (Continue to hold) |
|---|---|---|---|
| Entry | 105.00 | 59.63 | 618.49 |
| Current | 110.11 | 61.42 | 625.74 |
| Movement | 4.9% | 3.0% | 1.2% |
| Summary text |
Based on the RRG analysis, the share remains attractive (particularly due to its ability to stay above the 200-day simple moving average). Upside momentum remains supportive of the trade.
Our profit target is R121, with a trailing stop-loss at R104. Exit the trade around 30 October 2023. |
The ETF is trading at some major support or accumulation phase, which is of interest. Remains below the 200-day simple moving average. Fading downside momentum is supportive.
Our profit target is R69, with a trailing stop-loss at R57.60. Exit the trade around 8 January 2024. |
A price action that appears to be in phase 2 of a two-phased bullish trend period, which remains of interest. The share is testing its 200-day simple moving average. Upside momentum supports the trade idea.
Our profit target is R678, with a trailing stop-loss at R602. Exit the trade around 11 December 2023. |
| Share Name and position |
ANH - BUY (Continue to hold) |
LHC - BUY (Continue to hold) |
DCP - BUY (Continue to hold) |
|---|---|---|---|
| Entry | 1 061.16 | 20.53 | 24.12 |
| Current | 1 063.54 | 20.23 | 23.35 |
| Movement | 0.2% | -1.5% | -3.2% |
| Summary text |
The price action seems to be forming a base and this remains of interest. The share continues to test the 200-day simple moving average. Fading downside momentum is supportive of the trade.
Our profit target is R1 174, with a trailing stop-loss at R1 015. Exit the trade around 13 November 2023. |
The price appears to be in the upper range of a declining channel pattern, and this remains of interest. The share remains above its 200-day simple moving average. Downside momentum remains a concern.
Our profit target is R27, with a trailing stop-loss at R18. Exit the trade around 6 November 2023. |
The share continues to display signs of a bullish divergence. The share remains below its 200-day simple moving average, and we maintain the counter-trend strategy. The price also seems to be building a base.
Our profit target is R29, with a trailing stop-loss at R22.20 Close the position around 29 December 2023. |
