Seeking Alpha

Gold miners will "struggle to make ends meet," Citi says

  • Even as gold mining stocks are poised for a third straight year of losses, Citi analysts say it could get worse, with companies likely to "struggle to make ends meet" after failing to pass on benefits from the past four years’ heyday in gold to shareholders.
  • Citi's gloomy view is in contrast to Marc "Dr. Doom" Faber's belief that gold miners is the one sector that should appeal to investors wanting to buy low and sell high; he likes Newmont Mining (NEM), Barrick Gold (ABX) and IAMGOLD (IAG).
  • Citi recommends investors play it safe with companies that can adapt to a lower gold-price environment, such as Buy-rated ABX and Medusa Mining (MDSMF.PK); it tags Sell ratings on Harmony Gold (HMY), African Barrick (ABGLF.PK) and Polymetal (POYYF.OB).
  • Gold mining ETFs: GDX, GDXJ, NUGT, DUST, GLDX, PSAU, GGGG, RING.
Comments (4)
  • User 11328491
    , contributor
    Comment (1) | Send Message
     
    And who is Citi? A bunch of goofballs who almost took it under. Would have too if not for the bailout. And now they are offering advice. No Thanks.
    13 Aug 2013, 09:31 PM Reply Like
  • spydrman
    , contributor
    Comments (10) | Send Message
     
    There you go. It will all work out. Meanwhile just switch as the trend does short term.
    13 Aug 2013, 10:15 PM Reply Like
  • edwinbill64
    , contributor
    Comment (1) | Send Message
     
    Medusa is a winner, they are about to finish upgrades to their co-o mine which will enable them to ramp up production. There is also some uncertainty around a proposed increase in Phillipino Mining taxes. If the mine is completed and the mining tax isnt as high as anticipated Medusa should pop in my opinion.
    13 Aug 2013, 11:01 PM Reply Like
  • Doewap
    , contributor
    Comments (849) | Send Message
     
    Sacre Coeur Minerals can weather low gold prices better than most as well. Known as a junior, but has income from gold production and positive cash flow, of which it intends to hand out 30% as dividend in the future.

     

    Gold may yet go lower, but I think it is near or even just past a bottom.
    14 Aug 2013, 05:42 AM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Tools
Find the right ETFs for your portfolio:
Seeking Alpha's new ETF Hub
ETF Investment Guide:
Table of Contents | One Page Summary
Read about different ETF Asset Classes:
ETF Selector

Next headline on your portfolio:

|