Platinum share price targets and broker ratings
In this article we take a look at the reversal in the platinum price, as well as broker ratings and price targets for locally listed counter Anglo Platinum, Impala Platinum, Northam and Royal Bafokeng.
For the most part of 2021 we have seen platinum group metals (platinum, palladium and rhodium) under pressure. The decline from May 2021 through to September 2021 has largely been catalyzed by semi conductor / micro chip shortages hampering motor vehicle production and sales.
PGMs (Platinum Group Metals) are used in vehicle exhausts to reduce harmful emissions, all the more important in a more environmentally aware society.
While the global chip shortage is expected to remain well into 2022, due to supply disruptions and manufacturing capacity constraints, we are starting to see early signs of a technical price reversal in the price of platinum.
Platinum – Technical Analysis
The price of platinum has now moved to break both trend line and horizontal resistance at the 1035 level. Supporting the bullish price movement we see the 20 day simple moving average crossing above the 50 day simple moving average (circled blue). The moving average crossover suggests a short to medium term reversal of trend from down to up.
The move above 1035 sees 1115 as the next upside resistance target from the move. Traders who are long might consider using a close below the 1005 level as a stop loss indication for the trade.
Platinum shares – Broker ratings and price targets
The below table shows locally listed platinum counters, highlighting long term price targets and broker ratings as of the 13th of October 2021 and sourced from Refinitiv Workspace.
| Company | LT Broker Rating | LT Target Price | Share Price | Discount/Premium to Target |
|---|---|---|---|---|
Anglo Platinum |
HOLD |
1697.50 |
1,517.08 |
-10.63% |
Impala Platinum |
BUY |
281.20 |
204.58 |
- 27.25 |
Northam Platinum |
BUY |
280.86 |
225.18 |
- 19.82% |
Royal Bafokeng |
BUY |
124.00 |
94.71 |
- 23.62% |
Sibanye Stillwater |
BUY |
82.82 |
54.16 |
- 34.60% |
The consensus ratings on Impala Platinum, Northam Platinum, Royal Bafokeng and Sibanye Stillwater are currently ‘buy’, while Anglo Platinum is perhaps the least favoured at current levels, with only a ‘hold’ rating.
All of the platinum counters listed above currently trade at discounts to a median of long term price targets, with the suggestion that Sibanye Stillwater trades at the deepest discount, followed by Impala, Royal Bafokeng, Northam and Anglo Plats respectively.
In summary
- A semi-conductor shortage has hampered vehicle sales and in turn demand for PGMs which have been declining for the most part of the year
- While the shortage still exists, we are starting to see signs of a technical price reversal most pronounced in platinum
- Platinum shares Impala, Northam, Royal Bafokeng and Sibanye Stillwater all carry a long term consensus broker rating of ‘Buy’
- Anglo Platinum carries a consensus long term broker rating of ‘hold’
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