Warren Buffett’s famous No.1 rule is “never lose money”. Clearly this is sage advice, however, I have always tempered this rule with “focus on things that will make you money”. I think Bellevue Gold Ltd (ASX: BGL) shares are one of the ASX companies likely to make you money.

And I’m happy to have a small stake in the company. 

I think Bellevue shares are a great growth opportunity in the gold mining sector as well as one of the best opportunities in mining shares.

Why Bellevue shares?

The company recently announced it has intersected high-grade gold 7.4km north of its Bellevue Gold Project in WA. This is in addition to the already estimated 2.2 Moz gold resources at an average grade of 11.3 grams per tonne. The mine is a proven, gold-rich resource that has been mined for over 100 years.

While 11 grams in a tonne may sound small, it is very large in relation to the grade of many mining sites. It also has existing infrastructure and has reserves at lower depths than comparable gold operations in Australia. All of these factors point to a rich operation with very low operating costs.

A combination of factors that make it likely to earn you money.

Over the past decade, I profited from investing in Northern Star Resources Ltd (ASX: NST) as it doubled its share price again and again. I have been most impressed that Bellevue has attracted significant talent from Northern Star -people who have already taken a small gold mining company into a major gold company at a global level. 

These include former Northern Star Mine Manager, Mr Craig Jones as the COO of Bellevue. As well as Mr Luke Gleeson as Head of Corporate Development.

Why Gold

Good gold mining companies regularly return good capital growth to their investors. This happens when the gold price is up, down, or flat. Right now the gold price is at historically high levels. When equities are falling or flat the shares in gold miners tend to rise. 

Added to this is the impact of infinite quantitative easing, in particular, in the US  but also in Australia to a lesser extent. In summary, this injects large amounts of liquidity into the markets. The combination of higher amounts of cash, low-interest rates and escalating uncertainty is likely to hold gold prices high.

Foolish takeaway

Bellevue is one of the country’s richest gold resources at a high grade and I think it has a strong chance to make you money. A combination of factors is likely to make this a low-cost operation at a time when the gold price is high. Even if the gold price falls this deposit is still very profitable. 

More reading

• 5 ASX shares that would’ve made you a fortune in 5 years
• Gold mining shares – these are the facts and myths
• ASX winners and losers from last week
• 5 things to watch on the ASX 200 on Monday
• Keep a watch on these 3 ASX trends next week

Motley Fool contributor Daryl Mather owns shares of Bellevue Gold Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Super Retail Group Ltd (ASX: SUL) share price has seen solid gains over the past 2 days after the company successfully completed its equity raising.  

After returning from its trading halt yesterday morning, the Super Retail share price jumped around 8% higher, and today has continued its upwards trend. At the time of writing, the Super Retail share price is up by another 1.98% to $8.75 per share.

Although the retail sector is struggling, Super Retail has managed to effectively navigate the coronavirus pandemic and could emerge stronger as consumer demand changes.

A closer look at Super Retail

Despite the underwhelming performance of most retailers during the coronavirus pandemic, there have been some bucking the trend. Super Retail serves as an example of a traditional retailer that has found renewed hope during Australia’s lockdown period.

The group – which owns prominent retail outlets such as Supercheap Auto, BCF and Rebel – recently completed a $203 million equity raising to fuel its strategy and growth initiatives. The fresh capital is intended to finance the company’s omni-channel business strategy.

Super Retail’s strategy is focused on growing its core brands and services to match changing consumer demand. Part of this includes investing in online and e-commerce programs, while also simplifying the company’s business model.  

Despite reporting a 26.2% decline in group sales for April, Super Retail reported a strong rebound in May with group sales increasing 26.5% on the prior corresponding period. In addition, the company saw a strong shift to e-commerce, with online sales increasing 126.2% during April and May in comparison to the prior corresponding period.

How is consumer behaviour changing?

Super Retail is also poised to benefit from a range of changing consumer behaviours following the coronavirus lockdown. With elite and community sports returning, the group’s sporting outlets like Rebel Sport could see renewed demand. This segment already experienced a surge in demand during the lockdown period as the shutdown of gyms drove consumers to stock up on home fitness gear.

In addition, with overseas holidays effectively cancelled in the short term, families and travellers could focus on more local activities. As a result, recreational activities like boating, camping and fishing pursuits could see renewed interest. The shift to online and digital commerce could also benefit Super Retail as the company looks to improve its click-and-collect services.  

Should you buy Super Retail shares?

Despite being one of the most shorted shares on the ASX, the Super Retail share price has surged more than 170% from its mid-March lows. Analysts from lead broker Morgans recently upgraded Super Retail to an ‘add’ rating. Analysts cited the group’s resilience during the coronavirus pandemic and changing consumer themes that could benefit the company. As a result, the broker slapped a $9.25 share price target for Super Retail.

Although analysts paint an optimistic outlook for Super Retail, the company is by no means out of the woods as yet. I think a prudent strategy would be to keep Super Retail on a watchlist to see if the company’s strategy plays out.  

More reading

• Top brokers just upgraded these ASX 200 shares today
• Why Afterpay, Super Retail, Uniti, & Viva Energy are charging higher
• ASX 200 jumps 3%: CBA rebounds, Afterpay hits a new record high
• ASX 200 falls 2%, ASX travel shares drop heavily
• ASX 200 down 0.3%: Big four banks mixed & Healius rockets on medical centre sale

Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Super Retail Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Zenith Minerals Ltd (ASX: ZNC) share price was a standout performer on the market today after the company revealed strong drilling results at its Red Mountain gold project.

Zenith Minerals shares closed 40.24% higher at 11.5 cents after rallying as much as 58.54% in early trade.

Zenith Minerals is a micro-cap ASX miner focused on advancing its portfolio of lithium, gold and base metals projects. Including today’s gains, Zenith has a market capitalisation of around $28 million.

Why the Zenith Minerals share price surged today

This morning, Zenith reported results from the maiden 10-hole reverse circulation drill program completed at its wholly-owned Red Mountain project. The project is located in Queensland, within 100 kilometres of operating gold mines at Cracow and Mount Rawdon.

The maiden drill program at Red Mountain is part of the company’s strategy to focus on its wholly-owned projects in Australia. The program was designed to test several different geological units and induced polarisation geophysical responses.

According to today’s release, the program has returned “highly encouraging near surface high-grade gold results”, including:

• 14 metres at 5.5 grams per tonne (g/t) gold including 6 metres at 12.3 g/t gold from surface;
• 5 metres at 3.5 g/t gold including 2 metres at 8.0 g/t gold from 64 metres; and
• 12 metres at 1.0 g/t gold from 42 metres including 4 metres at 2.1 g/t gold from 50 metres.

Zenith views the initial drill program a success, with encouraging gold results returned from only a portion of a larger target area. The drilling completed to date tests around 250 metres of strike of a 1,200-metre-long, high-order gold surface anomaly.

Following these strong results, the company noted it has a follow-up drill campaign planned for July.

Commenting on today’s update, managing director Michael Clifford said:

“We are delighted to announce that high-grade near surface gold mineralisation has been intersected in the maiden drill program at Red Mountain.”

“The target generated by Zenith’s exploration team is panning out to have the hallmarks of a significant mineralised system and we are very excited about the project’s upside,” he added.

More reading

• Fund managers have been buying these ASX shares
• 5 ASX shares that would’ve made you a fortune in 5 years
• Why I think Bellevue shares are ‘gold’ for your portfolio
• Why I’m watching the Super Retail share price
• I don’t normally buy ETFs, but I would buy these 2

Motley Fool contributor Cathryn Goh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Zenith Minerals share price rockets 40% after intersecting high-grade gold appeared first on Motley Fool Australia.

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