Why Medusa Mining Ltd Jumped Today

At the time of writing, shares of Medusa Mining Ltd [ASX:MML] are up by 18.84%, to 41 cents per share.

Why did Medusa Mining Ltd shares do this?

The company announced that its production should be within a range of 90,000–100,000 ounces for the 2019 Financial Year. The company expects its breakeven cost to be within a range of US$1,050–US$1,150 per ounce.

What now for Medusa Mining Ltd?

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

Medusa mining commsec
Source: CommSec

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The share price has experienced a rough ride over the past few months. Today’s announcement was vastly appreciated by shareholders.

The company’s profit guidance assumes the E15 Service Shaft will be in production next month. If that’s the case, it should provide a material contribution in the second half of FY19. Once operational, the E15 Shaft should reduce the manpower and material movements from the L8 Shaft. That should increase production from the lower mine levels.

The bottom line: The profit forecast sounds good for shareholders. But it’s merely a forecast at the end of the day. The mining business is unpredictable and there’s often multiple delays. That said, assuming the numbers above prove true and the gold price holds up, shareholders could be rewarded handsomely in the months ahead.

Regards,

Jason Stevenson,
Resources Analyst, Markets & Money

PS: Interested in mining stocks? My free new investor report, ‘The Top 10 Mining Stocks for 2018’, does exactly what it says in the name. I look at 10 companies that I believe could potentially make you huge money this year, and beyond. To download that report free, go here.


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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