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Some say gold prices, miners can regain their glitter in 2014

  • Gold miners' shares have jumped to the top of performance lists in a dramatic reversal, prompting some strategists to see signs that 2014 may be the year gold regains its shine.
  • The Market Vectors Gold Miners ETF (GDX) has rebounded 10% YTD following a 54% beating in 2013, the Junior Gold Miners ETF (GDXJ) has surged 16% YTD after last year's 61% plunge, and the SPDR Gold Trust (GLD) has gained 4% YTD after losing 28% in 2013.
  • Gold miners may have another $113B of reserves to write down, but most of the expected write-downs are already baked into the price, says ETF's Securities' Simona Gambarini, noting that gold miners are trading at a 4% discount to NAV, the lowest level on record.
  • ETFs: NUGT, IAU, DUST, PHYS, SGOL, UGL, DGP, GLL, GLDX, DZZ, UGLD, DGL, DGZ, JNUG, AGOL, RING, GLDI, DGLD, GGGG, PSAU, JDST, TBAR, UBG.
Comments (9)
  • Ulterior
    , contributor
    Comments (11) | Send Message
     
    yay, miners have capital and can short the futures again to make the delivery
    5 Feb, 06:50 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (8304) | Send Message
     
    The same people calling for the death of the gold mining sector just 14 weeks ago are celebrating the gold miner's prospects in 2014.
    Pathetic.
    How much are they paid to wet their finger and stick it in the air?
    5 Feb, 06:57 PM Reply Like
  • pauly6734
    , contributor
    Comment (1) | Send Message
     
    Same people calling United States Steel a strong buy at 31, and strong sell at 16.
    6 Feb, 02:11 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (3598) | Send Message
     
    I'm long physical gold at this point, but miners are still too dangerous. These companies are not known for their stellar management skills, and they've been put under a lot of pressure with gold prices down near the all-in cost of production. Expect to see some bankruptcies or at least some more mine closures and reorganizations unless the price of gold shoots up enough to give them a healthy profit. Inflation in emerging markets could hurt their cost-cutting efforts, as could a rise in oil prices. Many of them are heavily in debt so a rise in interest rates could also have a negative impact on their cost structures.
    5 Feb, 07:48 PM Reply Like
  • Philip Marlowe
    , contributor
    Comments (944) | Send Message
     
    The fact that miners are up without much improvement of the underlying fundamentals (i.e., price of gold) is not exactly a buy signal.
    5 Feb, 08:26 PM Reply Like
  • stan dargue
    , contributor
    Comment (1) | Send Message
     
    Buy gold ... miners too... got to go up
    5 Feb, 09:21 PM Reply Like
  • Mattster
    , contributor
    Comments (162) | Send Message
     
    These miners are trading so way below book value that one has to think the shorts are being a bit greedy here at this point
    5 Feb, 09:42 PM Reply Like
  • filipo
    , contributor
    Comments (2831) | Send Message
     
    I like physical gold better than miners.
    1/ I certainly never would pick out individual miners since I'm no geologist;
    2/ Mining index trackers went up in anticipation of a 20% increase of the gold price. That is wishful thinking and gold is lagging behind the miners. Hence miners are way too overvalued for the moment given their indebtedness and shaky business models (high costs vs low earnings).
    6 Feb, 03:08 AM Reply Like
  • Mike Ballanger
    , contributor
    Comment (1) | Send Message
     
    Buy the miners and short the S&P to hedge out market risk.
    6 Feb, 08:07 AM Reply Like
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