Analysis of Popular Gold Stocks
1.) AZK
Profile:
Based in Canada, Aurizon Mines is a producer of gold that operates in the Abitibi region of Quebec. Mines owned include, the Joanna gold project, Kipawa gold, and the Casa Berardi mine. Gold from the Casa Berardi mine last year totaled 158,830 ounces as this mine is the top producer for AZK. In addition to owning mines, AZK is invested in gold-index royalty with Beufor mine and Perron property. 285,222 ounces of gold were produced by the Beufor mine last year.
Technical:
AZK is in a technical consolidation, the volume is declining, and is about ready to break out.
Fundamental:
AZK seems expensive with a PE value of 52.6284, above the Gold & Silver industry median PE of 21.94; however its gross and operating margins are outstanding compared to its competetors within the precious metals industry. Even more appealing, their net margin is well above the industry median. AZK is one of the most profitable gold companies that you can buy. When the gold makes its complete breakout due to inflation, AZK will surely be a stock to own.
2.) CDE
Profile:
Coeur d’Alene Mines Corporation is a producer of silver and gold in North America. CDE is involved in operation, development, and exploration in numerous territories. CDE deals with properties in Chile, Argentina, Bolivia, Mexico, Nevada, Alaska and Australia. The company also has interest in several exploration based properties within the United States, Chile, Argentina, Bolivia, Mexico and Tanzania.
• Owns 100% of Empresa Minera Manquiri S.A.
• Owns 100% of the capital stock of Coeur Argentina S.R.L.
• Owns 100% of the Cerro Bayo mine in southern Chile and processing facilities.
Technical:
CDE just recently exhibited a signifigant spike in volume coinciding with relatively no change in price. This sort of activity is bearish. The stock is currently establishing a triangle/base at $14/share.
Fundamental:
CDE appears to be overvalued since it has a PEG value of 217.3228. This is very high compared to the rest of the industry. It also has an extremely high PE of 1086.614. CDE converts an above average percentage of its revenues to profits compared to its competitors. Unfortunately, the company is losing money on an operating basis. Although CDE is one of the largest and most publicized gold miners, we do not recommend owning it after it climbed nearly 115% since March. Don’t buy CDE.
3.) EGO
Profile:
Eldorado Gold Corporation participates in exploration, development, extraction, processing and reclamation of gold properties.
• The Company owns and operates the Kisladag gold mine in Turkey and the Tanjianshan gold mine in China
• Currently developing an iron ore project in Brazil.
• On July 7, 2008, the Company completed the acquisition of Frontier Pacific Mining Corporation
• December 15, 2008, Eldorado sold its Bermudian subsidiary, Sao Bento Gold Ltd. and its subsidiary Sao Bento Mineracao S.A.
Analysis:
EGO is valued at a relatively fair price according to its PEG of 4.2559, beating the Gold & Silver industry average of 4.01. Their PE is only 21.2796, it represents that there is room for price growth. Based on its gross margin, operating margin, and net margin, EGO has a great operating and net margin proving that it is efficiently managed. It also converts a larger percentage of its revenues to profits than most other companies in the gold business. The operating margin stands at 65.34%.
Discussion
What do you think? Leave a comment. Alternatively, write a post on your own weblog; this blog accepts trackbacks [trackback url].
Leave a Reply