‘No filter and immediate’. Why Twitter is the new mouthpiece for junior miners
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US President Donald Trump is infamous for his prolific tweeting, using Twitter as his own personal “newspaper”, but the social media platform is fast becoming the new mouthpiece for junior ASX-listed explorers.
I love Twitter…. it's like owning your own newspaper— without the losses.
— Donald J. Trump (@realDonaldTrump) November 10, 2012
Several junior ASX-listed explorers have amassed a decent following on the social media platform, an increasingly accepted way to get the message out and educate investors.
While it has on occasion been a source of pain for some explorers, with ASX regulators watching closely to just what is ‘tweeted’, Twitter is proving extremely popular.
Iron ore explorer Magnetite Mines (ASX:MGT) is ahead of the pack with 1740 followers.
Chairman Peter Schubert told Stockhead Magnetite Mines had the largest following that he’s aware of in the “small iron ore prospector” space.
“We’re really proud of that because we’ve tried to build it up with really good information, and it’s a very narrow narrative,” he said.
“It’s not like we’re Kim Kardashian, so to have a couple thousand followers I think we’re going okay. Obviously, we’d love to get that to 5,000 or 10,000.”
Twitter’s drawcard for Magnetite Mines is the “immediacy” and “non-filtered up-to-date information”.
“It gives us the ability to provide people that are interested in MGT or the iron ore market in general up-to-date information that they probably wouldn’t easily have access to otherwise,” Schubert said.
— MagnetiteMines (@MagnetiteMines) August 3, 2020
“A case in point is each day iron ore is actually priced on three grades commonly — 58, 62 and 65 [per cent iron],” Schubert explained.
“But on the news you’ll only see the 62 [per cent iron price].
“People don’t know that, so we’ll commonly post a chart showing those three price points because we’re actually above the 65 [per cent] and people will be able to connect that dot on the value of our project proposition.”
“In other words, from our point of view, we’re filtering and taking in a lot of iron ore information every day and then providing the ‘cream’ to our subscribers.”
Schubert says some of Magnetite’s posts have notched up between 10,000 and 30,000 views.
“It’s a very, very powerful medium for disseminating that information when small companies like ours are limited by budget,” he said.
Meanwhile, nickel explorer Blackstone Minerals (ASX:BSX) has 1300 followers and finds it a very useful tool for educating investors.
“We use it more to educate investors about nickel and EVs,” executive assistant Tessa Kutscher told Stockhead.
Nickel – @elonmusk's new favourite mineral
— Blackstone Minerals (@Blackstone_BSX) August 11, 2020
Kutscher said ASX announcements could be extremely technical and not easily understood by investors.
“That’s where I’m coming from, I’m not a geologist, so I’m investing in companies for other reasons than reading an ASX announcement,” Kutscher said.
“I do understand that our project is great because nickel goes into EV batteries and … in the next two to 10 years that will all become more and more important.
“And that’s what I try to educate the market on Twitter with why it makes sense to invest in us because we are going naturally the way of the future.”
Twitter is also becoming more important to ASX-listed companies given the shift to a larger cohort of millennial investors.
“It’s shifting from the traditional WA 60+ ex-mining engineer that made some money, towards smart young people that want to invest in something that has value for them, and they are all tech savvy,” Blackstone’s Kutscher said.
“So this is why I think it’s becoming more important, because the generation of investors has shifted.”
Uranium explorer Vimy Resources (ASX:VMY) is also up there with a good contingent of followers – 1194 to be precise.
CEO Mike Young’s posts are a lot more colourful than most.
I had an ADHD joke but….squirrel! https://t.co/4zkf6WXrgS
— Vimy Resources (@Vimy_Resources) July 26, 2020
And he forewarns his followers just what they will get beforehand:
“Tweets are by the CEO and comprise opinions, anecdotes, and stories about bikes. Feel free to agree, agree to disagree, or unfollow, but keep it civil.”
It’s obviously working because Vimy has managed to attract some Twitter “influencers”, including some pro-nuclear environmentalists, which is a big positive for a uranium company.
“There’s a lot of people on there that if they repost your tweets, or comment positively on your tweets, it’s meaningful,” Young told Stockhead.
“Ninety per cent of the people it probably isn’t, but there’s 1 per cent — there’s probably about 10 people out of all those followers — whose opinions really, I think, carry a lot of weight, and so you need to nurture those relationships in a positive way.”
Jeremy King, the chairman of gold and base metals explorer Sultan Resources (ASX:SLZ), says Twitter has become the forum of choice for some of the most influential people in markets globally.
“With the likes of Ray Dalio sharing their thoughts via “FinTwit”, the platform has attracted a huge number of retail and institutional investors,” he told Stockhead.
“As a company we find it a great way to communicate with investors in a less formal, more authentic manner when compared to LinkedIn.”
Sultan, which has a following of 279 and growing, uses Twitter to share ASX announcements but is working to utilise it as more than “just an extension of LinkedIn”.
“Recently, we have been sharing a lot of content about the recent surge in the gold price and creating more discussion about the macro environment for gold,” King explained.
— Sultan Resources (@SultanResources) August 6, 2020
“The ASX is home to some of the world’s most exciting gold explorers and it is beginning to attract a larger audience beyond Australian investors.
“We’ve seen a lot of interest coming from Canadian investors, a community we can access through Twitter.”
While Twitter doesn’t fall under the regulatory control of the ASX or market watchdog ASIC, it hasn’t stopped them from monitoring the social media site regularly and issuing “please explains” over certain tweets.
In 2018, once-market-darling AVZ Minerals (ASX:AVZ) was pulled up a number of times over a series of tweets by one of its advisors.
“Companies need to stick close to the announcements when discussing company news, we handle this by providing a short answer with a link back to the announcement,” Sultan’s King said.
“The ‘cashtag’ function holds everyone fairly accountable by aggregating tweets to one page.”
Magnetite Mines also takes its lead from the ASX when tweeting.
“We focus heavily on all of the same rules [such as] no forward-looking statements,” Schubert said.
“If we were going to post something MGT specific, we wouldn’t post anything new on Twitter it would have to go through the ASX side first.”
But the big question for every ASX-listed company is: will it move the share price?
Vimy’s Young believes you don’t have to live and die by Twitter, but it’s a handy tool to have in your toolkit.
“I think that in terms of what moves the dial on your share price, being on Twitter isn’t something that is going to do it in a meaningful way,” he said.
“That said, when you’re in uranium you need as many friends as you can get because there are dark forces out there opposed to uranium.
“Having a lot of friends is important but is it something that we absolutely need to do? No. Is it something we like doing? Yes.
“You just have to find a balance of not getting trapped and getting sucked into negativity. You just need to say what you’re thinking and just wear the remarks.”
At Stockhead, we tell it like it is. While Magnetite Mines, Blackstone Minerals and Sultan Resources are Stockhead advertisers, they did not sponsor this article.