TheBlackList Pub

For All Points-Of-The-View.



Growing geopolitical tensions and 'Trumpflation' have spurred a dramatic increase in safe haven demand, and the ongoing Bitcoin craze clearly proves it.

Bitcoin prices have more than doubled in the year-to-date, while those of its closest peer, Ethereum, are up an eye-popping 4,500 percent.

Yet, extreme volatility by digital currencies makes them a poor hedge against future uncertainties. Bitcoin has a downward deviation six times greater than gold's, making it extremely risky for use as currency.

Gold remains the pre-eminent and time-tested safe haven asset for hedging against macroeconomic upheavals. Companies in focus include large miners such as: Tahoe Resources Inc. (NYSE: TAHO), Goldcorp Inc. (NYSE: GG), Barrick Gold Corporation (NYSE: ABX), Agnico Eagle Mines Limited (NYSE: AEM), Franco-Nevada Corporation (NYSE: FNV)

Evidence keeps piling up: Future supply of the world's most important precious metal is now under threat. After years of falling gold prices, major miners everywhere have been forced to slash their exploration budgets, with many downsizing operations or completely shutting down.

Prior to the gold rally of 2017, gold prices had been falling since 2008 as economies around the world gradually improved in the post-financial crisis period, forcing producers to fold up operations. Even today, no new big mines are being developed across the world.

The spectacular collapse of South Africa's gold industry, formerly the world's largest, was the classic canary in a coal mine. At just 140 metric tonnes per year, the country's current production is a far cry of what it was a couple of decades ago.

The situation in South Africa foreshadowed a coming decline in global production.

Last year marked the first time that global gold output declined since 2008, with all major producers except Chinarecording significant declines.

The fact that we are now past 'peak gold' is a criminally underreported phenomenon, and the situation is expected to worsen as the years roll on.

The sad fact of the matter is that we live on a small, finite planet, and it's just a matter of time before the gold market has to climb a major wall of worry in the form of small and dwindling supply.

Against this backdrop, here are our 5 picks to get into gold right now, whether you're looking for an entry point that offers outsized gains or a consistent dividend safe house:

#1 Tahoe Resources (NYSE: TAHO)

For Tahoe, the main attraction right now is dividend yield. This company is paying double its peers, and blows pretty much everyone else away. That's unusual in gold. But it's not that black and white. This stock hasn't done well over the past few years, and the declining price of silver has taken its toll. It's also had trouble in Guatemala, and it's suffering from high production costs due to a string of acquisitions. But still, even though some of its peers' stocks are doing better, Tahoe still has the highest dividend yield. So why is that?

Tahoe is trading at 9 times its cash flow-way below its closest rivals. If it were trading higher, its dividend yield would fall. But that's not the only reason. It's also simply got a better dividend policy from a shareholder perspective. It's fixed at $0.02 per share (per month) or $0.024 per share per year. So, the dividend isn't based on cash flow. You might think this would be a problem for Tahoe, but it's not. The company actually has a strong cash balance sheet.

So while you might look at all of Tahoe's problems and be put off-or you might not like what's going on in Guatemala, or all the expensive acquisitions, from a purely dividend perspective, this is our number one pick right now. At the end of the day, it's all about dividends after all.

#2 Osprey Gold (OS.V; OSSPF)

This small-cap company isn't likely on your radar-yet. But it should be. That's because not only is it a good time to start getting back into gold, but it's a good time to start looking at different ways to get back in, and it might be best to think out of the box. What stands out here is the cheap open-pit mining, new technology that is making it even cheaper, and a return to one of the most prolific gold rush venues in the world-Canada's Nova Scotia.

Nova Scotia has already supported three major gold rushes, and we're looking at a fourth in the making. Miners with new technology are rushing back here to scoop up the easy pickings, and Osprey is the only real entry point here.

Osprey has moved into Nova Scotia's Goldenville-and it's a gold miner's dream.

Here, the technology is the key because it's making expensive underground mining operations obsolete. Geologists have recently developed a technology that allows miners to assess mineralization of host rocks through which gold veins run-so in a historical first in Canada, they can mine gold in open pits. That means lower productions costs, reduced risks, and improved ability to scale.

And the Goldenville property is phenomenal from this respect. It's unlike any other place in the world because rocks from nearly every age are already exposed so Osprey's got the fast-track to gold here, and right across the street, another company has make a $250-million project doing the same.

At the end of the day, this is the key entry point because it's a small-cap company (only $7.5 million) sitting on what could be $560 million in gold.

#3 Wheaton Precious Metals 

Wheaton is another good dividend play, paying out 20 percent of the cash it generates from operations racked up in the previous four quarters. The last quarterly dividend paid to shareholders was $0.07, but this one fluctuates, so we've seen it dip as low as $0.03 and soar as high as $0.14.

But beyond this, Wheaton is a great stock to own. Formerly Silver Wheaton, this company has seen shares rise more than 500 percent since 2005, and from most perspectives, it's going to continue on the upwards climb.

The reason for this is its unique business structure-and it's resulting high margins. Wheaton is unique because it doesn't just dive into mining. Instead, it looks for other major miners who need capital to expand existing projects. It seals its percentage of production at cut rates in this way, with long-term contracts that guarantee consistent cash flow. And it doesn't have to pay direct day-to-day mining costs. While at the same time it's incredibly savvy with its own overhead, it pays a minimum due to brilliant management.

With its multiple streams and diversity in combination with unique structure and stellar management, this stock is a smart choice on any given day.

#4 Newmont Mining  

This is the only gold mining stock listed on the S&P. Newmont is another favorite because of its strong balance sheet and asset value growth, but what you should be looking at here is how its restructured its portfolio to reduce risk and improve operational performance. With Newmont now you'll get exposure to stable gold and a nice, continuous cash flow. And it's expected to outperform.

Newmont's Q1 results impressed. Revenue soared 13 percent to $1.7 billion on higher pricing and volumes.

Attributable gold production jumped 9 percent to 1.23 million ounces for the three-month period as new production from Long Canyon and Merian nicely offset geotechnical concerns at Carlin. Exceptional weather affected operations in South America and Australia. GAAP net income from continuing operations came at $69 million while adjusted net income stood at $133 million.

#5 Franco-Nevada (NYSE: FNV)

FNV is also set to outperform this quarter, and this is a great play for the dividend-focused. This is the precious metals/royalty streaming business, so it's different than putting your money into direct mining. FNV provides cash up front to precious metals miners in return for the right to buy those metals at reduced rates in the future.

This is a high-margin business-over 70 percent. So, when gold prices have been weak, FNV is still increasing dividends. And we love the conservative operating strategy. You won't see yields as high as the direct miners, but you will see a very nice dividend consistency.

And while FNV has traditionally been all about gold and silver (or metals, in general), it's now moving quickly into oil and gas, which represented some 6 percent of its revenues in the first quarter of this year-and it's moving more in this direction.

Honorable Mentions in this space:  

Barrick Gold Corp. (NYSE: ABX) and Goldcorp Inc. (NYSE: GG): All eyes are on the billion-dollar partnership these two giants are forming in Chile's gold belt. Goldcorp is putting up $1 billion to get in on this deal as miners scramble for new sources of growth. This joint venture will see the two giant miners operate three properties in Chile's Maricunga region, and these will be major catalysts for both.

Agnico Eagle Mines (NYSE: AEM): Q1 was stellar for Agnico, especially for cash flow. Cash went onto this balance sheet despite all the spending on growth projects, and the rest of year looks set to be just as good. Follow the catalyst of construction at Meliadine, which has just launched and promises to be a massive project.

Alamos Gold: We might be in for an earnings surprise with this one, so this could be a good buy right now. A number of equities research analysts have raised their price objectives on this stock. With Desjardins estimating from C$13.25 to C$13.50.

By. Charles Kennedy

Legal Disclaimer/Disclosure from OilPrice.com: This piece is an advertorial and has been paid for. This document is not and should not be construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. No information in this Report should be construed as individualized investment advice. A licensed financial advisor should be consulted prior to making any investment decision. We make no guarantee, representation or warranty and accept no responsibility or liability as to its accuracy or completeness. Expressions of opinion are those of Oilprice.com only and are subject to change without notice. Oilprice.com assumes no warranty, liability or guarantee for the current relevance, correctness or completeness of any information provided within this Report and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission. Furthermore, we assume no liability for any direct or indirect loss or damage or, in particular, for lost profit, which you may incur as a result of the use and existence of the information, provided within this Report. All content contained herein is subject to the terms and conditions set forth in the original article posted on Oilprice.com and subject to the terms and conditions therein.

DISCLAIMER: OilPrice.com is Source of all content listed above. FN Media Group, LLC (FNM), is a third party publisher and news dissemination service provider, which disseminates electronic information through multiple online media channels. FNM is NOT affiliated in any manner with OilPrice.com or any company mentioned herein. The commentary, views and opinions expressed in this release by OilPrice.com are solely those of OilPrice.com and are not shared by and do not reflect in any manner the views or opinions of FNM. FNM is not liable for any investment decisions by its readers or subscribers. FNM and its affiliated companies are a news dissemination and financial marketing solutions provider and are NOT a registered broker/dealer/analyst/adviser, holds no investment licenses and may NOT sell, offer to sell or offer to buy any security. FNM was not compensated by any public company mentioned herein to disseminate this press release.

FNM HOLDS NO SHARES OF ANY COMPANY NAMED IN THIS RELEASE.

This release contains 'forward-looking statements' within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. 'Forward-looking statements' describe future expectations, plans, results, or strategies and are generally preceded by words such as 'may', 'future', 'plan' or 'planned', 'will' or 'should', 'expected,' 'anticipates', 'draft', 'eventually' or 'projected'. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company's annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and FNM undertakes no obligation to update such statements.

Contact Information:
Media Contact e-mail: editor@financialnewsmedia.com  
U.S. Phone: +1-954-345-0611

SOURCE OilPrice.com 
LONDONJune 27, 2017 /PRNewswire/ --




Views: 63

Comment

You need to be a member of TheBlackList Pub to add comments!

Join TheBlackList Pub


Donations Accepted

Get on TheBlackList with
the following networks:

Facebook Page Twitter Ning foursquare StumbleUpon Digg Blogger pinterest

 

Forum

Charlottesville In Historical Perspective

Started by Junious Ricardo Stanton in CURRENT EVENTS AND TOPICAL ISSUES 7 minutes ago. 0 Replies

From the Ramparts Junious Ricardo Stanton Charlottesville In Historical…Continue

COMMUNIQUE DU CIPN SUR LES AFRONTEMENTS DE CHARLOTTESVILLE AUX USA

Started by TBL_Promoter in CURRENT EVENTS AND TOPICAL ISSUES on Friday. 0 Replies

COMMUNIQUE DU CIPN SUR LES AFRONTEMENTS DE CHARLOTTESVILLE AUX USASamedi 12 août 2017 de violents affrontements ont opposé à Charlottesville (Virginie, USA..) des anti-fascistes américains alliés au mouvement Black Lives Matters, à des centaines de…Continue

“Spiral Freedom: A Solution to High Tech and Low Touch”

Started by Mama Akosua in CURRENT EVENTS AND TOPICAL ISSUES Aug 15. 0 Replies

Celebrating the 23rd Annual International Locks Conference: Natural Hair, Wholistic Health, and Beauty ExpoMuch is said about the convenience of the digital age which is full of advanced, ever evolving technology, yet with all the computers, digital…Continue

Stop Black Babies Dying in Columbus Ohio

Started by Charles E. Campbell in Politics. Last reply by Wes Barnard Aug 14. 1 Reply

Stop Black Babies Dying in Columbus OhioA People Who Refuses to…Continue

How Safe Is Your Drinking Water?

Started by Junious Ricardo Stanton in CURRENT EVENTS AND TOPICAL ISSUES Jul 31. 0 Replies

From The Ramparts Junious Ricardo Stanton How Safe Is Your Drinking…Continue

Seeking people interested in forming the New Afrikan Dance & Drum Ensemble in Jackson, MS.

Started by SendMeYourNews in The Arts. Last reply by Trekking in Nepal Aug 14. 1 Reply

The REAL Learning Institute is seeking persons interested in forming the…Continue

© 2017   Created by KWASI Akyeampong.   Powered by

Badges  |  Report an Issue  |  Terms of Service

Offline

Live Video

= = http://theblacklist.net/