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The Market Vectors Gold Miners ETF (GDX) was trading as high as $66.98 in September 2011. The index is currently trading at $28.35 or 57.7% below the September 2011 peak.

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In this article, I will feature two gold miners that have seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:

  1. The stock is purchased by three or more insiders within one month.

  2. The stock is sold by no insiders in the month of intensive purchasing.

  3. At least two purchasers increase their holdings by more than 10%.

1. Kinross (KGC) is a Canadian-based gold mining company with mines and projects in Brazil, Canada, Chile, Ecuador, Ghana, Mauritania, Russia and United States, employing approximately 8,000 people worldwide.

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Insider buying by insider (last 30 days)

  • Rick Baker purchased 1,954 shares on June 30 pursuant to a purchase/ownership plan. Rick Baker currently holds 38,737 shares or less than 0.1% of the company. Rick Baker is Senior Vice President, Environment and Project Permitting.
  • Thomas Elliott purchased 1,977 shares on June 30 pursuant to a purchase/ownership plan. Thomas Elliott currently holds 34,638 shares or less than 0.1% of the company. Thomas Elliott is a senior officer of the company.
  • Gregory Etter purchased 2,462 shares on June 30 pursuant to a purchase/ownership plan. Gregory Etter currently holds 13,822 shares or less than 0.1% of the company. Gregory Etter is a senior officer of the company.
  • James Fowler purchased 923 shares on June 30 pursuant to a purchase/ownership plan. James Fowler currently holds 4,646 shares or less than 0.1% of the company. James Fowler is a senior officer of the company.
  • Patrick Hickey purchased 1,857 shares on June 30 pursuant to a purchase/ownership plan. Patrick Hickey currently holds 18,335 shares or less than 0.1% of the company. Patrick Hickey is a senior officer of the company.
  • Glen Masterman purchased 2,395 shares on June 30 pursuant to a purchase/ownership plan. Glen Masterman currently holds 32,340 shares or less than 0.1% of the company. Glen Masterman is a senior officer of the company.
  • Warwick Morley-Jepson purchased 1,887 shares on June 30 pursuant to a purchase/ownership plan. Warwick Morley-Jepson currently holds 40,330 shares or less than 0.1% of the company. Warwick Morley-Jepson is a senior officer of the company.
  • Paul Rollinson purchased 7,772 shares on June 30 pursuant to a purchase/ownership plan. Paul Rollinson currently holds 138,199 shares or less than 0.1% of the company. Paul Rollinson was appointed to the Kinross Board and as Chief Executive Officer on August 1, 2012.

Insider buying by calendar month

Here is a table of Kinross' insider trading activity by calendar month.

MonthInsider buying / sharesInsider selling / shares
June 201321,2270
May 201340,0000
April 201300
March 201312,3000

There have been 73,527 shares purchased and there have been zero shares sold by the insiders since March 1.

Financials

The company reported the first-quarter financial results on May 7 with the following highlights:

Revenue$1.1 billion
Net income$160.5 million
Cash$1.4 billion
Debt$2.2 billion
Gold production648,897 gold equivalent ounces
Production cost of sales$729 per gold equivalent ounce
All-in sustaining cost$1,038 per gold equivalent ounce

Outlook

The company expects to be within its 2013 forecast guidance for production (2.4-2.6 million attributable gold equivalent ounces), production cost of sales ($740-$790 per gold equivalent ounce), all-in sustaining cost ($1,100-$1,200 per gold ounce sold) and capital expenditures ($1.6 billion).

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Competition

Kinross' competitors include Agnico-Eagle Mines (AEM), Goldcorp (GG), Newmont Mining (NEM), and Barrick Gold (ABX). Here is a table comparing these companies.

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Kinross has the second lowest enterprise value / EBITDA ratio among these five companies.

My analysis

There have been eight different insiders buying the shares and there have not been any insiders selling the shares during the past 30 days. There are 11 analyst buy ratings, seven neutral ratings and four sell ratings with an average target price of $7.23. The stock is trading at a forward P/E ratio of 16.20 and the stock has a dividend yield of 2.82%. The company's gold resource base is 94 million ounces. I believe the stock could be a good pick at the current level based on the intensive insider buying.

2. Agnico-Eagle Mines engages in the exploration, development, and production of mineral properties in Canada, Finland, and Mexico.

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Insider buying by insider (last 30 days)

  • Christian Provencher purchased 373 shares on June 30 pursuant to a purchase/ownership plan. Christian Provencher currently holds 2,362 shares or less than 0.1% of the company. Christian Provencher is Vice-President, Canada.
  • Jean Robitaille purchased 601 shares on June 30 pursuant to a purchase/ownership plan. Jean Robitaille currently holds 43,738 shares or less than 0.1% of the company. Jean Robitaille is Senior Vice-President, Technical Services and Project Development.
  • David Smith purchased 621 shares on June 30 pursuant to a purchase/ownership plan. David Smith currently holds 12,435 shares or less than 0.1% of the company. David Smith is the Senior Vice-President, Finance and Chief Financial Officer of Agnico-Eagle.
  • Don Allan purchased 635 shares on June 30 pursuant to a purchase/ownership plan. Don Allan currently holds 12,194 shares or less than 0.1% of the company. Don Allan is Senior Vice-President, Corporate Development.
  • Alain Blackburn purchased 634 shares on June 30 pursuant to a purchase/ownership plan. Alain Blackburn currently holds 3,730 shares or less than 0.1% of the company. Alain Blackburn is Senior Vice-President, Exploration.
  • Lino Cafazzo purchased 346 shares on June 30 pursuant to a purchase/ownership plan. Lino Cafazzo currently holds 1,813 shares or less than 0.1% of the company. Lino Cafazzo is Vice-President, Information Technology at Agnico-Eagle.
  • Brian Christie purchased 455 shares on June 30 pursuant to a purchase/ownership plan. Brian Christie currently holds 792 shares or less than 0.1% of the company. Brian Christie joined Agnico-Eagle in December 2012 as Vice President Investor Relations.
  • Mathew Cook purchased 275 shares on June 30 pursuant to a purchase/ownership plan. Mathew Cook currently holds 595 shares or less than 0.1% of the company. Mathew Cook is Vice-President, Controller of Agnico-Eagle.
  • Paul Cousin purchased 345 shares on June 30 pursuant to a purchase/ownership plan. Paul Cousin currently holds 6,142 shares or less than 0.1% of the company. Paul Cousin is Vice-President, Metallurgy.
  • Picklu Datta purchased 357 shares on June 30 pursuant to a purchase/ownership plan. Picklu Datta currently holds 3,308 shares or less than 0.1% of the company. Picklu Datta is Senior Vice President - Finance, Treasury.
  • Patrice Gilbert purchased 444 shares on June 30 pursuant to a purchase/ownership plan. Patrice Gilbert currently holds 5,084 shares or less than 0.1% of the company. Patrice Gilbert is Vice-President, Health, Safety and Community of Agnico-Eagle.
  • Guy Gosselin purchased 345 shares on June 30 pursuant to a purchase/ownership plan. Guy Gosselin currently holds 4,001 shares or less than 0.1% of the company. Guy Gosselin is Vice-President, Exploration.
  • Louise Grondin purchased 483 shares on June 30 pursuant to a purchase/ownership plan. Louise Grondin currently holds 6,091 shares or less than 0.1% of the company. Louise Grondin is Senior Vice-President, Environment and Sustainable Development.
  • Ingmar Haga purchased 488 shares on June 30 pursuant to a purchase/ownership plan. Ingmar Haga currently holds 7,684 shares or less than 0.1% of the company. Ingmar Haga is Vice-President, Europe.
  • Timothy Haldane purchased 593 shares on June 30 pursuant to a purchase/ownership plan. Timothy Haldane currently holds 10,189 shares or less than 0.1% of the company. Timothy Haldane is Senior Vice-President, Latin America.
  • Gregory Laing purchased 619 shares on June 30 pursuant to a purchase/ownership plan. Gregory Laing currently holds 12,744 shares or less than 0.1% of the company. Gregory Laing is General Counsel, Senior Vice-President, Legal, and Corporate Secretary of Agnico-Eagle.
  • Michel Leclerc purchased 373 shares on June 30 pursuant to a purchase/ownership plan. Michel Leclerc currently holds 2,073 shares or less than 0.1% of the company. Michel Leclerc is Vice-President, Project Evaluations.
  • Marc Legault purchased 495 shares on June 30 pursuant to a purchase/ownership plan. Marc Legault currently holds 14,543 shares or less than 0.1% of the company. Marc Legault is Senior Vice-President, Project Evaluations, of Agnico-Eagle Mines.
  • Luis Medina purchased 361 shares on June 30 pursuant to a purchase/ownership plan. Luis Medina currently holds 2,573 shares or less than 0.1% of the company. Luis Medina was appointed Vice President, Mexico in January 2011.
  • Jean-Luk Pellerin purchased 482 shares on June 30 pursuant to a purchase/ownership plan. Jean-Luk Pellerin currently holds 1,979 shares or less than 0.1% of the company. Jean-Luk Pellerin is Senior Vice-President of Human Resources.
  • Yvon Sylvestre purchased 579 shares on June 30 pursuant to a purchase/ownership plan. Yvon Sylvestre currently holds 4,609 shares or less than 0.1% of the company. Yvon Sylvestre is Senior Vice-President of Operations.

Insider buying by calendar month

Here is a table of Agnico-Eagle Mines' insider trading activity by calendar month.

MonthInsider buying / sharesInsider selling / shares
June 20139,9040
May 201300
April 20131,2000
March 20139,8640

There have been 20,968 shares purchased and there have been zero shares sold by the insiders since March 1.

Financials

The company reported the first-quarter financial results on April 25 with the following highlights:

Revenue$423.2 million
Net income$23.9 million
Cash$264.4 million
Debt$811.3 million
Gold production236,975 ounces
Total cash costs740 per ounce

Outlook

  • Agnico-Eagle's production guidance for 2013 is 970,000 to 1,010,000 ounces of gold.
  • Total cash cost per ounce guidance for 2013 is between $735 and $785 per ounce.
  • For the full year 2013, the all-in sustaining costs are expected to be approximately $1,110 per ounce.

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Competition

Agnico-Eagle Mines' competitors include Kinross, Goldcorp, Newmont Mining and Barrick Gold. Here is a table comparing these companies.

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Agnico-Eagle Mines has the highest enterprise value / EBITDA ratio among these five companies.

My analysis

There have been 21 different insiders buying the shares and there have not been any insiders selling the shares during the past 30 days. There are seven analyst buy ratings, 11 neutral ratings and three sell ratings with an average target price of $36.94. The stock is trading at a P/E ratio of 20.26 and a forward P/E ratio of 27.19. The stock has a dividend yield of 2.92%. The company's gold reserves stand at 18.7 million ounces. Agnico-Eagle Mines also has approximately 96 million ounces of silver, 220,000 tonnes of zinc and 73,000 tonnes of copper in reserves. I believe the stock could be a good pick at the current level based on the intensive insider buying.

Source: 2 Gold Miners With Recent Intensive Insider Buying