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Wednesday, Aug 7
Big gold miners are in big trouble if gold hits $900, Cowen says
- Some big gold miners (GDX) might be able to withstand another 30% drop in gold’s price for a year or more, but serious trouble could ensue by 2015, Cowen analysts say.
- Barrick Gold (ABX) and Newmont Mining (NEM) have "significant net solvency positions” for the moment, Cowen says, with NEM and Kinross Gold (KGC) coming under more stress the farther out it looks; the firm sees NEM, KGC and Agnico-Eagle (AEM) suffering low or negative profitability even with a $100-$200 gold price drop.
- Goldcorp (GG) and Yamana Gold (AUY) "appear to be able to withstand a severe gold price decline and still achieve positive earnings," according to Cowen.