Gold has been traditionally known as the bedrock investment for investors who want to play it safe. Interestingly, recent changes in the global economy have challenged this status quo and gold is no longer the stable commodity we knew it to be. Just this week, it was reported that gold fell $5.80 in April futures to level out at $1572.80 for a Troy Ounce at the COMEX division of the New York Mercantile Exchange. This is the lowest settlement price for gold since July 18, 2012. It may also interest you to know that gold went down 2.3 percent this week, which is some 12.5 percent down from its $1,796.50 high of October 4, 2012.
However, gold may be on its way to a rebound because of decisions made by the central banks Russia and Kazakhstan last month to increase their bullion reserves. In addition, Azerbaijan purchased bullion for the first time in three years in a bid to diversify the assets of her central bank. The interest in gold by these countries is good for the precious metal and, as a result, great for investors. Now is a good time to consider some gold small-caps that are affected by any news that affects gold.
The first company on our emerging gem list is Timmins Gold Corp (NYSE: TGD) with a market cap of $349.12 million. This gem appears to be unpolished right now and is trading at $2.53. The stock currently has a one year low of $1.45 and one year high of $3.47 with a PE ration of 10.54.
From all indications, Timmins appears to be in dangerous waters and investors may need to tread softly. Yet Timmins has a strong balance sheet if we consider its financials in the last 3 fiscal quarters. More interesting is that Timmins has forecast the production growth for fiscal 2013 to be within 125,000 and 130,000 ounces of gold
The second small-cap on the emerging gem list is Novacopper Inc (NYSE: NCQ) with a market cap of $104 million. The price to earnings ratio stands at 2.94 and the 52-week range shows a somewhat wide margin of a $1.65 low to a $4.76 high. However, it may interest you to know that Novacopper is still profitable despite gold movement because it has a safety net in its silver and copper interests.
Investors would be smart to pay attention to our third emerging gem; Fortuna Silver Mines Inc. (NYSE: FSM) with its $511 million market cap. Buying Fortuna may be a smart move right now if you would like to be a part of the growth that comes from its production guidance of 4.4 million ounces of Silver and 23.3 thousand ounces of gold in the current year.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.