Swick Mining Services (SWK)

[tommy]

I have started to dip my toes again into the cheapo sharemarket but have been terrible with "timing"... so at the moment quite a few are on my watchlist but still have not yet purchased.

One of them in the research stage is Swick Mining Services (SWK) listed in November, which has doubled in shareprice since due to the impressive half-year results beating forecasts and ensuing profit upgrade.

Website:
http://www.swickmining.com.au/

"The Swick Group was founded in 1960 and primarily as a water drilling contractor.

During its 46 years of operation, the company has significantly expanded its operations to include both surface and underground drilling and is now recognised as one of the most efficient and cost effective operations in the Australian Mining Industry.
Corporate Structure

Swick Mining Services Ltd is the ASX listed parent company of the group (ASX Code: SWK). This parent company owns 100% of both the operations entity SMS Operations Pty Ltd and the asset holdings entity SMS Asset Holdings Pty Ltd which owns all of our drill rigs and equipment.

SMS Operations Pty Ltd is divided into two distinct operational areas comprising of our Underground Drilling
and Surface Drilling divisions.

The Underground Drilling Division contains our Underground Diamond Drilling and Underground Long-HoleDrilling Departments.

The Surface Drilling Division contains our Surface Reverse Circulation (RC) Drilling and Surface Vacuum (Air-Vac) Drilling Departments and also manages our equipment support services (Rig Dry Hire)."

Important data:
* Net profit after tax of $2,632,455; 41.9% above forecast
* Underground diamond division performing strongly & growing
* New surface diamond drilling division established
* Positive outlook for H2 FY07; full year FY07 profit upgraded
Current net debt to equity ratio of 79%
* Capital raised has been largely invested in manufacturing new rigs
* Strategy has generated a high ROI and captured additional growth
* High interest cover at 5.94
* Facilities of up to $10m being finalised to support rig build program
* Intention to raise equity capital

Presentation:
http://www.swickmining.com.au/pdf/002%20SWK%20HY%20Result%20Mar%2007%20FINAL.pdf

Half-year results:
http://www.swickmining.com.au/pdf/006%20AN%20HY%20Result%2027%20Feb%2007.pdf

[corky]

Tommy

Been holding this one for a while and looks like there's more to come. Half year NPAT was $2.63m, full year forecast is $4.095m so you could say that looks achievable! I emailed the co to ask whether there were seasonality impacts or maybe higher investment but no response :(

Corky

[tommy]

Well done for holding corky mate,

I missed out on the spike because I was focused more on general market sentiment... I was hoping SWK would fall too but it never did, it just kept rising[xx(]

Only concern I have is the high level of debt and the management's intention to raise equity capital which has not been clarified yet (method, timing, etc.)

Worth keeping an eye on this company IMHO.

[tommy]

WTF, up 16%[:0]

Completely missed out on this one while my money was put into TRF...hope you are having a ball corky mate!

[corky]

Now up over $1 on the Newmont contract news!! Heady heights, not sure if these levels can be maintained but a nice ride. Dont think you need to worry about missing this boat Tommy, you must be on a few other good cruises.

Corky

[tommy]

Hi Corky,

Well done for holding on to this one, this is a huge contract win for SWK:)

I was actually juggling between buying into SWK or CXG last week and ended up buying CXG... damn, should have bought both[xx(]

[tommy]

SWK share price holding well even after 20 million placement announcement

http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=AU%3Aswk&draw.x=0&draw.y=0

Was expecting a bit of a pull back but hasn't happened!

[tommy]

SWK up 11% today [:0][:0][:0] WTF?!

http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=AU%3Aswk&draw.x=0&draw.y=0

[tommy]

SWK looks like its ready for another leg up????

http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=AU%3Aswk&draw.x=0&draw.y=0

[tommy]

Company Update!!

http://sa.iguana2.com/cache/20bb4154498d0aa6a4e9e78af9461794/ASX-SWK-368070.pdf

Nice growth story, check out da chart too:
http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=AU%3Aswk&draw.x=0&draw.y=0

[corky]

Now that's what I call a good update. Light on profit outlook though so I wonder if setup costs will eat in. Happy to hold though.

Corky

[donnie]

hi corky

your got a good little blog site there, keep up the good work.

[COLIN]

I held this one for a while last year, but the sp seemed to be going nowhere fast, and I dumped. I thought I should have another look at it today, given the news that they have been awarded a 2-year contract for CFE's Lady Annie, but there doesn't seem to be anything there that would lead me to buy back in, at this stage - unless, of course, the charts started to stir.

Someone else may have contrary views - I recall someone else on ST mentioning this stock on another thread, last year.

[macduffy]

That someone might have been me, Colin. I'm a sucker for mining services stocks and have held some longer than I should!

I still have a few SWK, encouraged by their steady progress into North America and improving utilisation rates in Aust although I'm more likely to sell than to buy more at this stage.

Good news though with the new two year Lady Annie contract.

[Dr_Who]

Mcduffy, how do you get time to read up on so many companies? I coudl barely fit 3 companies in my reading time a week.

I have so many companies to read up that I am getting confused. I need to focus on just a few.

[COLIN]

That someone might have been me, Colin. I'm a sucker for mining services stocks and have held some longer than I should!

I still have a few SWK, encouraged by their steady progress into North America and improving utilisation rates in Aust although I'm more likely to sell than to buy more at this stage.

Good news though with the new two year Lady Annie contract.

Thanks, MacD.
Dr. Who: I would hate to have to admit how many companies are in my portfolio. I know that the conventional wisdom is that, to ensure optimal portfolio performance, we shouldn't spread out too thinly; however, I seem to have an inbuilt resistance to putting too large a percentage of the portfolio in any one company, particularly the smaller caps. It does mean that I have to spend a lot of time monitoring my position, which means that my good wife starts questioning the amount of time I am at the keyboard!

[macduffy]

I could have written that, Colin!

And yes, doc, I have far too many companies to monitor - sometimes with poor results. But I adhere to the axiom that one 4 or 5 bagger, and I've had more than a few, will make up for a couple of write-offs so long as one is careful to invest more or less equal amounts. But what I must do is be a bit more disciplined in setting and acting on, where necessary, stop loss limits on my more speculative stocks to either quit a mistake early on or to protect my profits.

Nice theory!

:D

[macduffy]

Operations update from SWK.

New contracts signed and now expect to have a record 55 rigs in operation by March, including North American work with 5 under contract and one on trial drilling.

http://asx.com.au/asxpdf/20100119/pdf/31n77xfp1gv183.pdf

[macduffy]

SWK announced a major drilling contract from Newmont. In excess of $50m revenue expected over three years.

http://asx.com.au/asxpdf/20100324/pdf/31pfkzx0yg3jb8.pdf

Activity rebuilding for the company with 63 rigs in work by July.

[drillfix]

You holding MacDuff?

[macduffy]

Yes, unfortunately.

It's a small holding and one that I didn't monitor closely enough.

It's not performing SP- wise but the outlook for both the industry and the company is improving.

Would appreciate your view on the outfit, drillfix.

[drillfix]

My view on it Technically would be all I could offer, as I dont really know much about the stock except what the chart says.

Well good news about the rigs and contract so thats a good start?

Lets start from the bottom up shall we.
Supports
Major support at 18.5c, then to 40c support (intermediate atm but major should it break past the upper resistance line).
Resistance line at 45.5 (got broke but fell back since) would be good to see a break above 48c though.
Next resistance would be around a heat zone around 58c but would prefer a break past 60c.
The stock has bounced off the 40c intermediate support and is heading upwards as you can see.
The stock has been tracking below the 8ma and 20ma which short term track the direction of the current trend.
NOW the stock has cracked above BOTH the 8ma & 20ma lines and it now appears that there could be a cross of the 8ma touching the 20ma
This can be good and will be resolved on if it holds and crosses tomorrow/today but friday you will have an answer.

Stochastic is showing overbought and looks to be moving partially sideways to down.
RSI is aboe 50 @ 52.133 which is good and shows some current strength to the direction of the stock. (at present)
Volume for the stock is GOOD, showing over triple volume above the 200ma volume which could signal a change in Trend of a potential key reversal.
W%R24 is around 38.8 which is not showing over bought and looks healthy.


Well, enough of that razamataz, or whatever you wish to call it.

ATM, the stock is still trending downwards and has tested the above resistance and failed. IMO, it needs to rally a bit more and break past that or try to get above 50.5c and cross the Oblique (diagonal) resistance line to change the short term direction which there are a few things running in its favour, but all the same, are required for anything to go upwards.

Anyway, the long of the short of it is, it could go anyway, good overall market conditions and some more PR by the company could push this across the line in which case you would see piles of swing traders also jump on board seeing the confirmation, which at present, is what it seems to be all about for what people are waiting for (technically).

Hope this helps~!

[Jay]

Yes, unfortunately.

It's a small holding and one that I didn't monitor closely enough.

It's not performing SP- wise but the outlook for both the industry and the company is improving.

Would appreciate your view on the outfit, drillfix.


Have a small holding in this as well and like you was not monitoring and missed the last high of 70 odd cents.

Still in profit just at present

[stoploss]

On the back of the strong update from MSV.ax today I have purchased some of these . Seems to be a seller around @ 12.25 cents as I tried to pay 12.5 and got filled in the middle.
They have recently paid a divvy ,first since 2015 and are commencing a share buyback.

[stoploss]

Shot up to 19 cents Thu/Fri . No news out so maybe something afoot ...... Might be a bit of resistance around the 20 mark . Mining services still going well . Gold price certainly helping .

[stoploss]

Swick have announced another contract win . Mining services are benefitting from the "Gold Rush"
https://stocknessmonster.com/announcements/swk.asx-6A991316/
Currently up 5 cents @ 22.5

[stoploss]

Full year results are out , not doing as well as i thought they would .
Have sold out , as I have better places to put the funds.Sharesight tells me I made 65.8 % since my 15/04/20 post
https://stocknessmonster.com/announcements/swk.asx-6A993577/