No surprises about the more solid looking prospects in the Gold mining sector: BDR NST DRM TRY http://www.thebull.com.au/premium/a/43150-8-penny-prospects-for-2014.html "Given the fact the ASX All Ordinaries Gold Index fell more than 60% in 2013, why would anyone but the maddest of punters consider getting on board the battered gold miners? Yet four ASX gold miners made the early top pick lists. Believe it or not, some of Australia's big brokerage houses are bullish on these four gold miners. Beadell Resources Limited (BDR) leads the way with Outperform, Overweight, or Buy recommendations from Macquarie, UBS, Deutsche Bank, and Citi. From the table you can see the numbers for BDR support the view, although anyone who has been following the gold story over the last two years knows analysts and experts alike have been wrong more often than right. Nevertheless, a 5 Year Expected P/EG of 0.03 and a 2 Year Earnings Growth Forecast of 123% is enough to get the blood pumping. Beadell has assets in Brazil and Australia but it is the company's Brazilian Tucano Gold Mine that generates investor and analyst interest. The company has high grade assets and substantial exploration acreage both in Brazil and Australia. Latest production reports were positive but what piques analyst interest the most is BDR's low cost of production. Research analysts at Macquarie estimate Beadell's production costs at approximately $US680 an ounce, which means the company can remain profitable even if the price of gold drops to $US1000 per ounce. Deutsche Bank sees the company ready to pay down debt and begin paying dividends in late 2014. Investors in Northern Star Resources Limited (NST) already receive dividends, with a current yield of 4.3%, fully franked. Northern Star has performed well over time for its shareholders, with a 19% average annual rate of shareholder return over 10 years and a 38% return over 3 years. The company had more than $55 million total cash on hand as of the most recent quarter with $11 million in total debt. Gearing for NST is a modest 10%. The strength of its balance sheet allowed NST to make some strategic acquisitions in FY 2013 at bargain prices. Macquarie is the lone firm of the big houses covering Northern Star with an Outperform recommendation. The industry has adopted a more accurate measure of the true cost of mining gold called "All in Sustaining Cost" (AISC). Northern uses this measure and reports its latest AISC was down 10% from the prior calculation, now standing at $996 per ounce. Expect Northern Star to grab up more low cost gold mines from larger producers looking to shed assets. While Beadell's share price has outperformed Northern Star's over the last two dismal years for gold stocks, both are positive over that time period. Macquarie has Outperform recommendations on the remaining gold miners in our table, with an impressive $2.30 target price for Troy Resources Limited (TRY) and a $0.75 price target on relative newcomer Doray Minerals Limited (DRM). Doray began trading on the ASX in February 2010 at $0.20 per share. In September 2012 the company ran a highly successful capital raise to fund its principal asset, the Andy Well Mine in Western Australia. The raise was oversubscribed and the share price did not drop dramatically in response. The mine has now gone into operation and the latest production reports suggest this will be a high grade, low cost operation. In addition, Doray has exploration assets in South Australia and has discovered additional potential adjacent to the existing Andy Well project. Troy Resources is another well capitalised gold miner that has taken advantage of the devastating climate in the gold sector, acquiring rival Azimuth Resources in mid-2013. The company has high grade, low cost operating mines in Argentina and Brazil as well as high grade deposits in Guyana. Troy has been around for some time and it is only in the last year the share price tumbled after recovering from the GFC. "
