Trader’s Cafe with Zak Mir: TOOP, KR1, PXC, CMET, TLOU, URU, MODE & MYSL via Vox Markets

Shares of telecom services provider Toople (TOOP) appear to have been in turnaround mode for some months, helped along by the aftermath of last month’s interim results.

By Zak Mir

Here there was fundamental backing for those who feel the stock has turned the corner, with most of the key metrics heading in the right direction. This included significantly narrowed losses, and costs. Perhaps even more encouraging was way the company highlighted improvements in gross margin and gross profit. This would imply that it would not take much from this point to reach a serious inflection point. Already some traders have been looking to the relationship with the likes of BT on the basis that one and one could add up to more than two, if only in terms of order volume. Earlier this month a trio of TR1’s including one from canny investment house Oberon (OBE) suggests that positions are being taken at Toople for recovery.

The past week has seen investment announcements from star digital asset specialist KR1 (KR1). On Thursday we heard of a $100,000 investment in RedStone Finance, while to end the week it put $269,892 into Interlay, in return for 1,224 Series Seed Shares. KR1 invested in Interlay, with the likes of IOSG Ventures, Zee Prime Ventures and CMS Holdings. Interlay’s flagship product is interBTC, a fully collateralized one-to-one Bitcoin-backed asset. It may be that KR1’s timing on these two deals is on the money given the latest swing in sentiment towards crypto, with Bitcoin back towards $40,000.

Timing share breakouts is a skill to have in the stock market, as it avoids one sitting on “dead money.” In the case of British Virgin Islands-based base and precious metals production and exploration company Phoenix Copper (PXC), its fans had to sit through some 10 months of the stock sitting in a stubborn 40p – 50p consolidation band. Even with the mid July announcement of sulphide-rich mineralization being found underneath its Empire mine in Idaho, the range remained until last week. Typically, what one sees is not only a delayed reaction to good news in such situations, but the breakout when it comes can gather a logjam break effect and there is added momentum to the rally. So far Phoenix Copper has peaked at 72p in just a few sessions. However, after being held back for so long there could still be more for the bulls to get their teeth into.

There has also been something of a delayed positive share price reaction at Capital Metals (CMET). A couple of weeks ago the natural resources company focused on the development of the Eastern Minerals Project in Sri Lanka provided an update on its activities. The company said it has had meetings with the relevant government authorities and good progress is being made with the environmental process, with news due in the “coming weeks”. Clearly such negotiations require Capital Metals to be in full ESG overdrive mode. It added that the project’s commercial mineral sands, including zircon, the titanium ores rutile and ilmenite, and garnet, will be extracted using proven non-chemical processing methods. After which the area will then fully available for alternative uses such as agriculture and tourism, or to remain as a wilderness, something which even Greta Thunberg might approve.

Another stock which could be emerging from the darkness into the light is Tlou Energy (TLOU) which is developing power solutions in Sub-Saharan Africa through gas-fired power, solar power and hydrogen projects. It offered two RNS’s in one day to end the week. The company has three project areas in Botswana, Lesedi Project, consisting of Gas & Solar Development, as well as the Mamba and Boomslang Projects. On Friday it said it had signed binding Heads of Agreement with Synergen Met, a hydrogen developer which uses plasma technology. The HOA will involve the construction and commissioning of a hydrogen and solid carbon prototype to be installed at the Lesedi Project.

Although it may have been something of a false dawn breakout for shares of URU Metals (URU) in May through 350p, not helped by a speeding ticket RNS at the time, it would appear that it has been second time lucky for shares of the exploration and development group. Traders have been licking their lips at the prospect of a disposal of the company’s Zebediela Nickel Project, and therefore it may be that news Blue Rhino Capital Corp has received conditional acceptance from the TSX Venture Exchange for the acquisition of the Zebediela is just what the doctor ordered.

Fans of next-generation financial ecosystem builder and Bitcoin trading app Mode Global (MODE) have no doubt been looking upon their stock not only as the next Revolut, but perhaps something even greater. Therefore, it has been slightly disappointing that the stock remains close to its IPO price, even as the price of Bitcoin recovers. However, given the modest market cap considering all the company’s serious financial regulatory badges, Mode may yet return to being a decent proxy to not only all things crypto, but the fintech world as well.

One of the big winners since the pandemic began has been online retailers. However, to date not all of this pixie dust has rubbed off on MySale (MYSL). Nevertheless, things may be about to change for the ANZ off-price fashion, beauty and homewares marketplace platform, a point underlined by the sharp bounce for the stock at the end of the week. This may have been helped by the recent update from the firm as it improved key metrics of gross profit to AUD46.3 million from AUD43.9 million and costs down to AUD42.1 million from AUD47.8 million.

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Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.


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