Ben Kramer-Miller
Gold & precious metals, macro, research analyst, deep value

Primero Mining: Why I'm Having Second Thoughts After The Brigus Acquisition

In August I suggested that investors consider purchasing shares in Primero Mining (NYSE:PPP) in order to get exposure to the gold price. The shares had performed, and continue to perform, incredibly well relative to other smaller gold miners, as is evidenced by the following chart of Primero shares relative to the Market Vectors Junior Gold Miner ETF (NYSEARCA:GDXJ).

(click to enlarge)

This can likely be attributed to the following:

  • Primero's solid history of growth and future growth potential.
  • The company's low production costs.
  • Its strong cash position vs. a minimal debt load.
  • The location of its mines: low risk Mexico.

I concluded by suggesting that Primero shares wouldn't offer explosive leverage to the gold price unlike...

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