Why Capricorn Metals Ltd Jumped Today

At the time of writing, shares of Capricorn Metals Ltd [ASX:CMM] are up by 54.24% to 9.1 cents per share.

Why did Capricorn Metals Ltd shares do this?

The company announced a confidential, non-binding, indicative acquisition proposal from Regis Resources Ltd [ASX:RRL]. The offer stands at 11.4 cents per share, representing a 93% premium on Capricorn’s last closing price of 5.9 cents on 21 September.

What now for Capricorn Metals Ltd?

The market reacted favourably to the news, as you can see on the chart below:

capricorn metals commsec
Source: Commsec

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The share price hit a high of 9.2 cents today.

I’ve been tracking this company since it was at 8 cents per share last year. I believe the fundamentals have been drastically undervalued by the market all year.

It’s no surprise a take-over offer has been received by the market.

The best gold miners are trading at astonishing discounts in this market, primarily because the gold price has remained depressed.

The bottom line: The proposal looks good for shareholders. But a few hurdles remain before the offer becomes binding and supported by the directors of Capricorn Metals.

Jason Stevenson,
Resources Analyst, Markets & Money

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Jason Stevenson is Markets & Money’s resource analyst. He shares over a decade’s worth of investing and trading experience across resource stocks and commodity futures and options. He originally studied accounting and finance at Curtin University, where he was awarded a first-class honours degree. His professional background stems across high-net-worth, top tier accounting (corporate finance, tax and auditing), and sell-side equities research. Before joining the team at Markets and Money, Jason worked at boutique firms which advised fund managers and high-net-worth clients on where to invest. Whether it’s gold, crude oil, copper or an obscure metal like vanadium, you can rely on an in-depth analysis in Markets and Money. Jason also brings you extensive macro, political and geopolitical analysis from around the world. He leaves no stone unturned when it comes to telling the truth. Jason is also the lead analyst of Gold Stock Trader, a premium service for investors serious about precious metal stocks. Websites and financial e-letters Jason writes for:


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