Seeking Alpha

JPMorgan's gold miner picks

  • It's a good idea to have exposure to gold stocks in one's portfolio, say JPMorgan analyst John Bridges and team, but beware of sector plays (GDX -1.3%), and instead pick and choose carefully.
  • Goldcorp (G +0.1%) is a "simple decision stock," says the team, thanks to its strong balance sheet, growth profile, and disciplined management. Names like Barrick (ABX -1.2%), Newmont (NEM +1.1%), and Kinross (KGC -1.9%) would fare better in a gold bull market, but today's "back-to-basics phase" means valuations are driven by strong operations and accretive deals.
  • Another theme is to own players with operations in the safest locations, an idea paying off for Agnico (AEM +0.7%), but the team also recently initiated B2Gold (BTG +1.1%) with positive coverage on the idea some companies can learn how to operate successfully in "more complex locations."
  • Another favorite is laggard Buenaventura (BVN -0.5%) which is likely to see improved results in H2.
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Comments (6)
  • Doug Eberhardt
    , contributor
    Comments (3290) | Send Message
     
    Long JNUG on this pullback. Maybe one more move up.
    20 Jun 2014, 03:30 PM Reply Like
  • Doug Eberhardt
    , contributor
    Comments (3290) | Send Message
     
    Nice end of day run for JNUG. Holding over weekend.
    20 Jun 2014, 04:10 PM Reply Like
  • Doug Eberhardt
    , contributor
    Comments (3290) | Send Message
     
    Out of JNUG on that last run up. :-)
    23 Jun 2014, 11:26 AM Reply Like
  • King Rat
    , contributor
    Comments (834) | Send Message
     
    Wonderful timing, JPM, wonderful timing.

     

    What is this nonsense of "accretive deals". Exactly how much M&A has been going on in the sector over the past year?

     

    "Don't buy the sector, just buy the winners. Oh yes, and a few laggards while you're at it."

     

    I am sure they perform grammar checks but they missed a few logic checks there.
    20 Jun 2014, 03:32 PM Reply Like
  • techy46
    , contributor
    Comments (6827) | Send Message
     
    Long ABX hedged with 2015 and 2016 covered LEAPS.
    20 Jun 2014, 03:55 PM Reply Like
  • james.
    , contributor
    Comments (530) | Send Message
     
    "Cheat Sheet" by Christopher today at 4:01 pm EDT did change his NEM recommendation from "Hold" to "Buy" with a Price Objective of $31 per share. He currently has no position in NEM ; his Fundamental analysis is very detailed, and includes quotes from CEO Goldberg; read it today by going to http://on.mktw.net/qPAyXt , and enter NEM in the Search Field, and then left click on the article in the "News" section .
    The NEM P&F Chart Price Objective is $38 per share, obtained using widely available Software with my selection of a Box Size of 4.4% for best accuracy. Similarly, other P&F Price Objectives are as follows : HL = $5.91 , GLD = $169 , and SLV = $27 .
    Contrary to the erroneous claim in the above Seeking Alpha article that Gold isn't now in a Bull Market, Gold is in fact now rising up on its 3rd Leg Super Cycle that will classically carry it to new all-time highs of $2700 per oz circa July 2015, and Silver to $54 per oz.. The 2nd leg Gold Super Cycle classically concluded in Dec 2013 when it did Double-Bottom at $1186 per oz in Dec 2013; that $1186 is the Geometric mean between the high and low of that 2nd Super Cycle leg, which is a 50% correction on semilog paper. June 20, 2014 at 1:59 pm PDT.
    20 Jun 2014, 05:01 PM Reply Like
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