Gold stocks are down across the board, what's the best buy?

P

phrenzy

In Memoriam - July 2017
Silver Stacker
Can't help but think that over the next week or so if we see this continue that there will be some good strike opportunities for the better miners, the question is which ones represent a decent investment in this enviroment? I think the obvious two, assuming they discount enough, are Newcrest and Silver Lake.

The others I'm looking into for some more info and analysis are:

Northern Star
Resolute
Beadell resources
St.Barbara

I thought maybe we could pool our collective know how in case someone has done a bit of in depth research on one in particular and wants info on another that perhaps someone else has been watching.


My family has a little Newcrest and their stated AISC seems to be potentially profitable with the current exchange rate even if we move sideways between $1025 and $1075usd for a year. They have one mine that will be problematic at that price but overall they'll be fine while others are struggling and might be very well placed to buy up distressed assets that let them really take off when the market turns around. The one thing to note on the other side of tge equation that I've seen is that their private debt is only rated BBB. That's not great and between glencore and the market generally pricing in more risk with all resource debt they might have difficulties in that area should they need or want to borrow money.

So far my reading seens to show that Newcrest is the one you'd want to buy if you were only going to have one gold miner and you wanted one that will still be I'm the game almost irrespective of the gold price this month, next year or in 2020 and will profit accordingly when things kick off.

The question then is if you have your safer bigger name then what one or two others do you buy that are safe at these prices but are a bit more speculative with much bigger upside when gold is back to $1500usd? My thinking is Silver Lake and St.Barbara but I'd love to hear some opinions as I haven't read enough to make a really informed call.

Anyhow I'm sure this is on a lot of people's minds, what's everyone else's opinions?

*edit* forgot to mention the GDX and if you're set up to trade in the states the GDXJ. It's an easy way to buy the sector but given that some miners have reported AISC costs pretty damn close to current spot I can't help but think that now is the time to be extra picky and grab the companies that are best placed to survive rather than buying scattershot across the sector.
 
Tricky times alright, I jumped off the SLR train at a profit, no rush to get back on it or Northern Star until Gold price rebounds.Ditto SAR.
Keen on BDR,BLK,SAU,,,,longshots that aren't for the faint hearted but could provide a big result are LSR,WCN,BGS.
Hold them all but DYOR please.
Current favourite stock is ERI, big hopes for this and the Cannabis industry is seriously worth a look .
Interested to hear from others, just wish Gold price would behave!!!
 
They're very big and diversified. Some people think BHP is a good buy at these prices, others think that borrowing money to pay a dividend is the beginning of a deep rot.


The problem I have with them both is that if you believe in coming global recession (Japan is already there) and possible monetary problems then you aren't likely to be very bullish on copper or iron or zinc and that's where a lot of their money comes from.

The way I look at it if there's a broad commodity turn around then gold will likely benefit a bit and the gold primary producers will do better. If there's a collapse then the gold primary producers will do better. Rio or BHP only do better in the first scenario.
 
so what will work in both scenarion ? cash ? gold ?

phrenzy said:
They're very big and diversified. Some people think BHP is a good buy at these prices, others think that borrowing money to pay a dividend is the beginning of a deep rot.


The problem I have with them both is that if you believe in coming global recession (Japan is already there) and possible monetary problems then you aren't likely to be very bullish on copper or iron or zinc and that's where a lot of their money comes from.

The way I look at it if there's a broad commodity turn around then gold will likely benefit a bit and the gold primary producers will do better. If there's a collapse then the gold primary producers will do better. Rio or BHP only do better in the first scenario.
Click to expand...
 
I don't have any gold stocks at the moment, just lithium and nickel. Sold my gold stocks about a week before the recent spike (NST and RMS). All the ones mentioned above are good and ones that I would buy myself, SBM was a buy about a year ago that's for sure. I've noticed that BDR seems to responds very well when gold goes up, more so than others.
EVN would be on my list also and LSR as a specie as mentioned above.
I know we all love Pms but check out other sectors too, Bellamys, Blackmores and Capillano have done very well recently.
 
Gold appears to be maintaining this downward trajectory and i wouldn't be surprised to see it drift much closer (or below) the USD$1000/oz level for a short period of time. Which means... there will be a better time to buy the goldies shortly... however here is my run on a few;

EVN:

Good management
Good growth
AISC AUD$1000/oz (AUD$500/oz profit)
Last quarter they had a AUD$100m net profit which is fantastic
<$1/share is a target for my next trigger pull.
Dividend linked to profit (2% i think)... has a DRP as well.

BDR

Average management
Single mine with a AISC ~ USD$1040 (I.e. barely breaking even at these levels).
Fairly good mine in Brazil, lower grade atm but higher grade underground.
This quarter will see increased profits due to a higher grade cutback.
Not buying. Might buy later once i see some profit outlooks in the new year...

A few Aussies to look at are;

DRM (Just won mine of the Year Australia).
RMS (Sprott owns about 10%).
SLR (They are only a shell of what they once were... but have bottom earlier in the year at $0.13).

Your best bet is to stick with the Aussie producers as most have a AISC of around AUD$1000-$1200 and will weather lower prices in USD rather well when compared to their North American friends whom many will be treading water around about now.

I think December/January will see some good pickings!

BB
 
bellinvest said:
SLR (They are only a shell of what they once were... but have bottom earlier in the year at $0.13).
Click to expand...

I believe SLR doesn't have any debt, which is a good position to be in.
 
bellinvest said:
EVN:
Good management
Good growth
AISC AUD$1000/oz (AUD$500/oz profit)
Last quarter they had a AUD$100m net profit which is fantastic
<$1/share is a target for my next trigger pull.
Dividend linked to profit (2% i think)... has a DRP as well.
Click to expand...

DRP's are the go for long term investments. Buy and forget.
I got EVN under a dollar, and if it drops below again I'll get more. I don't think it'll get there though.
 
SilverDJ said:
bellinvest said:
EVN:
Good management
Good growth
AISC AUD$1000/oz (AUD$500/oz profit)
Last quarter they had a AUD$100m net profit which is fantastic
<$1/share is a target for my next trigger pull.
Dividend linked to profit (2% i think)... has a DRP as well.
Click to expand...

DRP's are the go for long term investments. Buy and forget.
I got EVN under a dollar, and if it drops below again I'll get more. I don't think it'll get there though.
Click to expand...

Same Same
 
SilverDJ said:
bellinvest said:
SLR (They are only a shell of what they once were... but have bottom earlier in the year at $0.13).
Click to expand...

I believe SLR doesn't have any debt, which is a good position to be in.
Click to expand...

They are a shell of their former glory... they are selling some of there assets and maintaining their core holdings.

AISC AUD$1350 with production around 100,000oz/year... they are now spending on exploration which hasn't been seen in years.

A bear market weeds the boys from the men... SLR played their cards wrong betting on a gold rocketship.

Management have also been turfed so they scene is fresh.

Ill buy the bottom of this dip when it comes (not yet).
 
I am back in today on SLR at 19.5c after making a decent return on them in the last run up. I like the fact they are practically debt free and have a strong recent rally.

Reckon the gold price could be approaching a support level and SLR has a much better upside potential once the support level is found.
 
BuggedOut said:
I am back in today on SLR at 19.5c after making a decent return on them in the last run up. I like the fact they are practically debt free and have a strong recent rally.
Reckon the gold price could be approaching a support level and SLR has a much better upside potential once the support level is found.
Click to expand...

I'm in big with SLR at an average price of a bit over 18c, and lower than that in the super fund. Didn't pick up any more on the recent drop though, I have more than enough exposure.
The debt free aspect sold it for me.
 
Been a rocky old month for Gold stocks!
Keen on SAR,BLK and LSR in that order with BDR possibly on the way back up, could be a good year 2016.Best of luck.
 
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