A significant disconnect has occurred between the SP of gold stocks and $A POG in the last month. A sample of producers show SP falls from the peak in second week of April of about:
EVN - fall of 23% NST - 24% fall NCM - 12% fall GOR 27% fall SBM - 27% fall ALK - 27% fall CAI - 24% fall BGL - 20% fall DEG - 25% fall
TIE is no different.
Since 10 April POG $A has been quite stable between $A2,620 and $A2,660 (currently about $A2,670) except for one day when it went to $A2,690 and another when it went just below $A2,620.
Despite profit margins of gold producers being stable SP prices of producers have fallen by about a quarter.
Before this fall some commentators considered SP of gold producers were cheap so are they now very cheap?
SP of producers seems to be reflecting $US fall in POG and negative sentiment of share markets.
Will end up being a good entry point for buying gold producers/developers or are we going to see further falls?
TIE Price at posting:
42.8¢ Sentiment: Buy Disclosure: Held