Will These Mining Stocks Be On Your Watch List This Week?
The last year has been an exciting one for mining and gold stocks. Investors putting big money bets on gold stocks, ETFs and other mining-related names have seen a strong push to new highs over the last few weeks. And while a few gold producers had big years, it’s not just the price of gold that has acted as a catalyst.
If you look at the industry over the last few weeks, you’ll notice that earnings season has begun. Mining stocks are beginning to report production figures and for many, these are near or at record levels. So while earnings during the last few quarters may have generated big revenues thanks to the price of gold and precious metals alone, it appears that the next phase is hitting record revenues by reporting record production figures.
With this in mind, it’s also important to remember that this year is an election year. Furthermore, the latest comments that came from the IMF ahead of the World Economic Forum this week suggest global economic growth is slowing. What this could translate to is a strong case for safe-haven stocks like gold. Keeping this in mind, let’s take a closer look at a few companies that have started turning heads this month. Will they be on your mining stocks to watch list?
Gold Stocks To Watch: Sibanye Gold Ltd
One of the most popular gold stocks to watch over the last year was Sibanye Gold (SBGL – Free Report). Believe it or not, shares traded around $2.90 about a year ago. Since then, the stock has climbed to fresh, 52-week highs of $11.27 this week. As of Tuesday’s close, SBGL stock has climbed 270%, year-to-date.
The company recently took majority control of DRDGOLD (DRD – Free Report) via an option execution to lift its stake to 50.1%. “It will come in very handy in accelerating the further unlocking of value in DRDGOLD’s business and will go a long way to fund the early-stage development of Far West Gold Recoveries Phase 2,” CEO Niel Pretorius said in the statement.
In other developments, the company continues to focus on streamlining its operations. This includes cutting jobs at some of its projects. In a mid-January update, the company reduced the number of contractors at its Marikana project site. It cut a little over 1,700 contractors, transferred 166 to other operations, while about 1,612 employees took voluntary separation packages. Will these moves help set Sibanye up for success in 2020?
Gold Stocks To Watch: IMC International Mining
Next, IMC International Mining (IMCX – Free Report) has continued to trend higher in January. Just a few weeks ago shares traded around C$0.25 and have since moved as high as C$0.37. As of January 22, the gold mining stock traded just shy of C$0.34. The big focus for the market recently has been on the company’s Bullard Pass property in Arizona.
It was previously targeted by some of the biggest mining companies in the past. These have included NRG Resources, Unity Mining, and even Freeport McMoRan (FCX – Free Report). Why this site, which is 100% owned by IMC International, may be so important is what potential lies within it. What I mean by this is that geological reports actually state, “the mineralogic and structural similarities of the Bullard and Copperstone districts suggest that potential exists for a major gold deposit in the area of the Bullard district.”
Assuming that the site could be opportune for gold discovery, the current climate for gold prices could offer more potential for the company should it firm up production. Furthermore, according to IMC International, district production totals were 614,000 pounds of copper, 3,600 ounces of gold, and 15,000 ounces of silver from 17,000 tons mined that occurred between 1933 and 1956.
Rider: It is noted that the results of nearby or adjacent properties are not necessarily indicative of the potential of the Cathedral property and should not be understood or interpreted to mean that similar results will be obtained from the Cathedral property.
Mining Stocks To Watch: Gerdau SA
Finally, Gerdau SA (GGB – Free Report) has been on the move for the last few months. Since late-August, shares of GGB stock have climbed from $2.77 to highs this month of $5.27. Obviously this move didn’t happen just based on the excitement in gold and mining stocks.
Gerdau has inked a deal with Swedish bearings maker SKF. The performance-based contract aims at increasing productivity and decreasing downtime at two of Gerdau’s steel mills. Where SKF comes into play is its ability to help clients like Gerdau boost output and decrease costs.
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Obviously, the results of these measures are still yet to be seen. But considering earnings season has begun, will Gerdau be able to realize some of the business-boosting and cost-reducing activities in its upcoming earnings report?
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