SPR spartan resources limited

0.00%

$2.13

Gold and macro environment, page-358

First 358 Last

Share
Profile

Follow
pindanplotter

528 Posts.

33

21/09/24

18:07

Post #: 75779346
Share

Originally posted by calmbeforestorm: ↑

Are gold producers share prices cheap or not?

In the past year POG has increased by $US666 or by 35% (see image below).

According to the WGC (World Gold Council) AISC has been about $US1,400 for gold miners with a margin of $556 a year ago which is now $1,222!

So if AISC has not changed then gold producers margins have increased by a whopping 120% in the past year assuming current gold prices. Let’s assume AISC has increased by a level that reduces that to a 100% increase in margins.

On a like for like basis maybe we should expect gold producers share prices to reflect their better profitability and that they have increased by 100%.

However according to the GDX (major gold producers ETF) they have only increased by 36% (see image below). So miners margins have increased by circa 3 times the increase in share prices so what gives?

However, it’s worse than this as miners costs are higher than AISC so margins have increased by a lot more than 100% or 120%. If AIC is $1,600 then gold producers margins have nearly tripled but share prices have only increased by 36%!

So gold producers are now much cheaper than they were a year ago based on profits relative to share prices.

Obviously no one seems interested in buying gold mining shares until they want to buy them and who knows when that will occur but when it does gold miners share prices will likely surge.

But wait analysts of gold producers and the general investment community are predicting the POG will fall so maybe gold stocks are expensive! Are they right or just dreaming? The alternative is gold miners costs are going to explode by over 50% in one year!

So who is right?

A. The analysts and general investment community who believe POG will fall or AISC will explode higher?
B. The market is plain wrong and is significantly mis-pricing gold miners
C. Investors who are buying gold miners hand over fist and gold bugs

Expand

All brilliant points, I understand why SL doesnt want to rush to production. But the sooner we are pulling metal out of the ground in the back of a truck on its way to the plant the better.

SPR Price at posting: $1.39 Sentiment: Buy Disclosure: Held
5 Upvote

0 Great analysis

Reply

Top Stories

ASE

Astute delivers high-grade lithium hits at Red Mountain

Rokeby, BHM, more: The 10 hot stocks HotCopper users watchlisted in Week 30

Most investors will get this earnings season wrong. Will you?

What is going on here? Watch out for DroneShield, Pure Hydrogen, and Nel ASA

Listen: HotCopper Wire Podcast 019 – Dreaming of the 9,000s

RNU

Renascor produces graphite concentrate at Siviour, right on time to meet ex-China demand

FTL

Firetail scoops up untested land around Excelsior – including juicy mineralisation target

Friday's HotCopper trends: Renascor concentrate, Larvotto raise | July 25

ASX Market Close: Fading miners drag bourse as iron ore price slumps | July 25

SGQ

St George banks $5M from placement to ramp up Araxá Rare Earths Project

First 358 Last

Add to My Watchlist

What is My Watchlist?

A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.

(20min delay)
Last $2.13		Change 0.000(0.00%)		Mkt cap ! $2.847B

Open	High	Low	Value	Volume
0.0¢	0.0¢	0.0¢	$0	0

Gold and macro environment, page-358

Astute delivers high-grade lithium hits at Red Mountain

Rokeby, BHM, more: The 10 hot stocks HotCopper users watchlisted in Week 30

Most investors will get this earnings season wrong. Will you?

What is going on here? Watch out for DroneShield, Pure Hydrogen, and Nel ASA

Listen: HotCopper Wire Podcast 019 – Dreaming of the 9,000s

Renascor produces graphite concentrate at Siviour, right on time to meet ex-China demand

Firetail scoops up untested land around Excelsior – including juicy mineralisation target

Friday's HotCopper trends: Renascor concentrate, Larvotto raise | July 25

ASX Market Close: Fading miners drag bourse as iron ore price slumps | July 25

St George banks $5M from placement to ramp up Araxá Rare Earths Project

Featured News

Featured News

Gold and macro environment, page-358

Top Stories

Astute delivers high-grade lithium hits at Red Mountain

Rokeby, BHM, more: The 10 hot stocks HotCopper users watchlisted in Week 30

Most investors will get this earnings season wrong. Will you?

What is going on here? Watch out for DroneShield, Pure Hydrogen, and Nel ASA

Listen: HotCopper Wire Podcast 019 – Dreaming of the 9,000s

Renascor produces graphite concentrate at Siviour, right on time to meet ex-China demand

Firetail scoops up untested land around Excelsior – including juicy mineralisation target

Friday's HotCopper trends: Renascor concentrate, Larvotto raise | July 25

ASX Market Close: Fading miners drag bourse as iron ore price slumps | July 25

St George banks $5M from placement to ramp up Araxá Rare Earths Project

Featured News

Featured News