These 4 Names Have Started Grabbing Attention In January
When it comes to picking a certain gold stock, there’s a lot to take into consideration. One thing to consider is the broader markets. Right now could be an indication that supports a bullish stance on safe-havens. What is the reasoning behind this idea? The S&P 500 Index is once again nearing record highs. Historically these are extreme levels for the index. So it wouldn’t be out of the question to assume that markets could consolidate.
This is especially important considering a few things are causing a stir:
- The U.S. President, Donald Trump’s Impeachment hearings
- The continued trade war (despite a Phase 1 deal) between China & the United States
- Slower global growth expected for 2020
- The potential fall-out from economic side-effects of the coronavirus
These are just a few of many global events triggering unease in the stock market right now. We may have seen early signs of a pull-back on January 24 as well. Shares of the S&P’s SPY ETF slid $332.53 to lows of $327.36. This was the biggest one-day drop since October. Aside from coronavirus concerns, a lot weighs on the current impeachment proceedings in the U.S.
Bullish Case For Gold Stocks To Buy?
Commodities like gold are sometimes held at the mercy of investor sentiment. Obviously, the general economics of supply and demand play a role. However, the fear factor tends to have a more immediate impact on gold stocks.
During times of fear, the markets typically turn toward gold as a hedge against potential downturns. One thing’s for sure, though and that is gold stocks and other mining stocks have gained significantly over the last year. Furthermore, despite some consolidation at the beginning of 2020, the latest trend has several gold stocks heading higher during the second half of January.
Barrick Gold Stock
Barrick Gold stock (GOLD – Free Report) (ABX) is one of the “gold standards” in this industry. It’s frequently discussed among other peers and has strategic deals in place with gold miners of all sizes. Since January 14, shares of Barrick Gold stock have been on the rise. In fact, shares have made a new high for 7 consecutive trading days since then.
Recently, the company raised eyebrows after making a big announcement. The government of Tanzania signed an agreement with the gold miner that could end a tax dispute between the two. The President of the United Republic of Tanzania, Dr John Pombe Magufuli formalized the establishment of a joint venture between Barrick and the government.
“Since taking over the operatorship, we have been engaging with local communities to restore the mines’ social license to operate and we are cooperating closely with the authorities to address the environmental issues at North Mara. In addition, we are working on a local supplier strategy as well as a community development plan to create sustainable economic opportunities for the people around our mines.”Mark Bristow, President & Chief Executive, Barrick Gold
IMC International Mining Stock
Next, IMC International Mining stock (IMCX – Free Report) has been rallying during recent weeks. The stronger focus on junior gold stocks has triggered a larger awareness of the M&A trend that seems to have grown with these types of companies. Though IMC isn’t at the center of an M&A deal at this time, it is looking to advance its assets, which includes its 100% owned Bullard Pass asset.
The property has shown previous production. These figures totaled 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. In addition, an Arizona Geological Survey states that “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.”
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.
Obviously, it’s still early, yet the company’s management is no strangers to big mining projects. For example, Brian Thurston, President and Chief Executive Officer was instrumental in the initial exploration, land acquisition and development of Aurelian Resources’ Ecuador grassroots exploration. Aurelian was later acquired by Kinross. In addition to other leaders, Greg Hawkins is part of IMC’s advisory board. He was the Founding Project Consultant and/or Founding Director of seven public and private Exploration/Development ventures. These ventures collectively have accounted for over $2.1 billion in market cap at the companies’ respective peaks.
Yamana Gold Stock
Next, Yamana Gold stock (AUY – Free Report) (YRI) hit gold stocks watch lists this week. The company saw shares reach new 52-week highs of $4.10 on Thursday. Closing out the week, Yamana gold stock came within striking distance of hitting those highs was again.
The company recently reported its production highlights for the fourth quarter and full-year of 2019. These included several big milestones for Yamana. First, Q4 production totaled 221,595 ounces of gold and 2.97 million ounces of silver, which was above expectations. In addition, full-year production came in at 900,339 ounces of gold (which exceeded guidance) and 10.6 million ounces of silver, which exceeded Yamana’s original guidance.
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February will be an important month for Yamana. It will provide financial results, mineral reserve, and mineral resource estimates. In addition to these, Yamana will also give its guidance for 2020 to 2022. All of this information will be discussed on February 13th. Something else to note is that starting this quarter, the company implements its $0.05 per share dividend.
Kinross Gold Stock
Finally, Kinross Gold stock (KGC – Free Report) (K) etched a new 2020 high last week. In fact, the gold stock closed the week right at that high ($4.92). While most companies have reported production results for Q4 and full-year 2019 already, Kinross is set to do so on February 12. The company will also report its guidance for 2020 on that date.
What’s helped spark intrigue among investors recently was what the company announced earlier this month. Kinross completed its previously disclosed acquisition of Chulbatkan from N-Mining Limited. This is a high-quality, heap leach development project in Russia. The total purchase price was $283 million and Kinross expects to spend roughly $10 million on initial exploration drilling at the site.
Based on estimates, this could be a valuable project for the company even as a stand-alone. Kinross expects about 3.9 million gold ounces in indicated mineral resources. It also estimates 80,000 gold ounces in inferred mineral resources for the project. So we’ll see what comes of both the Q4/2019 results as well as follow the progress of this new project.
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