The shocking news is that Lloyds Banking Group reported £416m in impairments for the quarter, exceeding the projected £371m. With higher interest rates putting pressure on consumers and businesses, the consequences of this economic climate are still unfolding.
Investors in Lloyds will need to focus on dividends as they anticipate a possible recession or slow economic growth. Dividends are estimated to grow to 3.12p in 2024 and 3.52p in 2025, offering a 7.8% yield on the current share price. Essentially, Lloyds is incentivizing investors to wait for better times.
It’s worth noting that Lloyds Banking Group is the owner of The Telegraph, but has no involvement in editorial matters.
Questor suggests holding on to Lloyds shares.
Ticker: LLOY
Share price at close: 44.94p
Update: Shanta Gold
Investing in gold miners can be challenging, especially when a company embarks on a new mining operation. Initial setbacks and the need for adjustments to processing plants and equipment are common.
Shanta Gold’s recent update was a potential turning point for the share price. After successfully launching its Singida project in Tanzania on March 30, the following months were crucial for the new mine’s performance.
Although Shanta released a reassuring statement on June 1, stating that Singida had reached commercial production status, it wasn’t until July 20 that the market gained a proper understanding of its performance.
The second quarter update came as a surprise, boosting the share price by 10% in a single day.
Singida’s launch exceeded expectations, with gold production surpassing the company’s forecasts by 19% during the three-month period.
Shareholders welcomed this positive news, especially after the recent drama surrounding Shanta as an investment. The share price took a hit in June when major shareholder Odey Asset Management sold off most of its holdings in the gold miner. Allegations of improper conduct by Crispin Odey resulted in the asset management firm having to liquidate holdings to meet client redemptions.
Shanta also faced challenges in previous years, such as reduced production guidance at its New Luika mine in Tanzania and failed takeover interest. Moreover, the fluctuating gold price added to the uncertainty in the past three years.
All these events serve as reminders that investing in gold miners requires resilience. However, Shanta’s latest update offers reassurance for those who remain committed.
With two operating mines, Shanta now has multiple revenue sources. Additionally, the company is gaining confidence in its West Kenya exploration project, which could become its third lucrative venture. However, further analysis by Shanta is necessary before making any development decisions.
Dan Coatsworth, stock market analyst at AJ Bell
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