SBM got hammered over the very poor quarterly production update.

Our point is a general one, about ESG, and cost curve positioning. The call to action, as it were, is to emphasise what sort of companies we are attracted to, versus, well, less so.


Some companies are accident prone.

It’s a good example of how ESG is (or should be) just a normal part of the research process (rather than a separate factor given undue weight or sage emphasis).

But the AISC is pretty unappealing too. The latest data puts SBM (best glimpsed in the bottom left, where it was close to $1964/oz) now moves firmly into the $2000’s. Note the by-product method (top right) is not per oz.

Junior gold miners, or those positioned in the bottom half of the cost curve, are rarely worth the trouble, in our view.

SBM’s best features are the grade (high for midsize gold miner) and mine life (~20years).

Stock picking is hard enough, and whilst there may be some ten baggers amongst the list (Chalice, comes to mind) the odds that you’ll find them before the fact (including us!) are low.

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