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WORLD'S 100 HOTTEST GOLD STOCKS

posted on Jul 22, 2009 05:58AM
WORLD'S 100 HOTTEST GOLD STOCKS

Stellar performance of $45bn gold supergroup

These 100 selected gold stocks have risen by an average of 468% since late in 2008; the top runner has climbed more than 10,000%.

Author: Barry Sergeant
Posted: Wednesday , 22 Jul 2009
JOHANNESBURG -
Most of the world's bigger gold stocks look like serious plodders compared to some of the spectacular stock price increases put in by smaller gold stocks, not least Ventana Gold, which has risen by more than 10,000%. A selection of the 100 "hottest" performing listed gold stocks around the world indicates a rise of 468%, on a value-weighted basis, from stock price lows, typically seen during the closing months of 2008.
The 100 stocks, which carry an aggregate value of $45.12bn, contain a good number of names that can hardly be rated as "penny stocks". Seen as a grouping, these 100 stocks boast the highest return over the past while, among any known global subgrouping. A far broader measure of gold stocks, with an aggregate value of $292bn, have "bounced" from lows by a more modest 171%, measured on a weighted average basis.
The latter number outpaces somewhat the value-weighted 142% bounce recorded by the world's 100 most valuable miners. The broader logic from the numbers confirms that bigger gold names weigh down the average; the 14 Tier 1 gold diggers have recorded an average bounce of 145% from lows, with Barrick, the biggest by value and production, lagging with 106%.
STOCK GROUPS
Value
From
From
USD bn
high*
low*
Top 100 global miners
1417.90
-37.4%
141.9%
100 hottest gold stocks
45.12
-18.9%
467.9%
Silver stocks
21.13
-35.2%
261.4%
Oil stocks
2412.96
-29.1%
54.4%
S + P 500 Energy
1051.53
-36.8%
41.7%
Zinc stocks
30.79
-22.5%
252.1%
Copper stocks
105.21
-35.8%
249.4%
Gold stocks
292.22
-25.4%
171.4%
Gold ETFs
47.58
-16.0%
30.9%
Uranium stocks
27.76
-30.0%
159.0%
Paper stocks (60)
58.90
-41.1%
106.9%
Shipping stocks (32)
36.14
-59.0%
105.8%
World banks (80)
2837.86
-38.8%
120.4%
Dow Jones Industrial
3000.37
-28.8%
44.6%
* 12-month
Source: market data; analysis by Barry Sergeant
Looking at the "hottest" list, an immediate word of caution is that speculators (and perhaps the odd investor) which dabble in and around this subsector confirm an eternal fickleness, where loyalty is forever yesterday's jaded drumstick. Take Novagold, which owns world class deposits, including Alaska's Donlin Creek, a 50:50 joint venture with Barrick. While a decision to build this mine remains pending, the venture's current 29.3m ounce reserve base indicates a life, according to a feasibility study, of at least 20 years, with gold production for the first 12 full years averaging nearly 1.5m ounces a year, a number achieved by few gold mines anywhere.
Novagold's stock price fell to half a Canadian dollar late in 2008, 95% below its earlier high of CAD 10.00 a share, and more than that from levels of CAD 20.00 a share seen in both 2006 and 2007. While the stock price recently made CAD 6.00 a share, a 12 times multiple from recent lows, the price has now moved below CAD 5.00 a share. A number of top performing gold stocks that fall into the Novagold type category - through each has its own story -include Frontier Mining, New Dawn, Colombia Goldfields, Azteca Gold, Mano River, Appleton Exploration, Trilliant, Yukon-Nevada Gold, High River, Oroco Resource, PanAust, Luiri Gold, Elray Resources, Reunion Gold and Midway Gold.
These stocks are not for widows and orphans. There has even been some recent net selling of Ventana Gold, which this year has published a series of high grade drill intercepts from the La Mascota mineralized zone on its flagship La Bodega gold property in Colombia. At least one analyst has mentioned a price target of C$10.00 a share for Ventana, not least on the back of a projection of 550,000 ounces of gold production a year at total cash costs of just $295 an ounce.
This could turn out to be another proverbial ship in the night; Greystar, which has long proven up a resource of more than 10m ounces of gold, and more than 60m ounces of silver, at Angostura, also in Colombia, is languishing 44% below its stock price highs. Greystar carries a market value of $172m, considerably less than the $375m carried by Ventana.
Either Greystar is undervalued, or Ventana is overvalued, but not both. Ventana's market value is close to half the number alongside Novagold's name. The roving bubble-herd mentality, and sometimes what seems like temporary insanity, sometimes grips junior gold stocks and was seen classically this week, when Ventana announced that it had "not sold any common shares" in Ventana to 63X Master Fund, of Grand Cayman; 63X had earlier announced that it had bought just over 10% of the issued shares in Ventana from Ventana itself. Press pause and replay?
Top notch drilling results remain, as always, a consistent theme among the pecking order of "hottest" gold stocks; in Australia, Sandfire Resources has seen a gain of nearly 4,000% in its stock price on the back of drill results at DeGrussa prospect, part of the 100%-held Doolgunna project. DeGrussa may be primarily copper, but it has associated gold, silver, zinc and palladium. In Canada, Queenston Mining has also moved substantially on drill results, including recent news from its 100% owned Upper Beaver property in Kirkland Lake, Ontario. Shield Mining, busy in Mauritania, also fits into the great drill results category.
Another strong theme has continued to emerge with the rise of gold stocks active in Africa, after last month's bid by Red Back for Moto Goldmines was last week countered by a joint bid of nearly $500m from Randgold Resources and AngloGold Ashanti. African and Africa-related names that have put in sterling performances this year include La Mancha Resources, Pelangio, PMI Gold, Avion Resources, Shield Mining, Ampella Mining, Sunridge Gold, Keegan Resources, Cluff Gold, Gryphon Minerals, Nevsun, Helio Resource, African Queen, Adamus Resources, and Golden Star.
Names involved in potential or actual corporate activity tend to rank among top performers; beyond Moto, the likes of Klondex Mines and Paramount Gold can be mentioned; likewise, potential favourite takeover targets that have risen to the top include Seabridge, San Gold, Allied Nevada, Lake Shore Gold, Osisko, Medusa, US Gold Corp., West Timmins, and Norseman Gold, not to forget evergreen favourite Andean.
A more recent trend, supported by broad Chinese stock market indices such as the CSI 300 and Shanghai Composite riding at 12-month highs, has seen Chinese miners turning in excellent performances, in the gold arena, in the shape of the likes of Shandong Gold, Zhongjin, Zhaojin, and Canada-listed Mundoro. There have also been some stellar recoveries in prices for stocks operating in the Russian region, as seen in the case of JSC Polymetal, and Peter Hambro, and also in the Asian region, as seen in the cases of Centerra and East Asia Minerals.
100 SELECTED GOLD SUPER-PERFORMERS
Stock
From
From
Value
price
high*
low*
USD bn
CAD 5.16
-18.1%
12800.0%
0.375
AUD 2.02
-1.0%
3940.0%
0.139
GBP 0.05
-63.3%
3500.0%
0.031
GBP 0.37
-8.7%
2350.0%
0.104
CAD 0.78
-27.8%
1850.0%
0.100
CAD 0.92
-50.3%
1740.0%
0.024
CAD 0.16
-44.6%
1450.0%
0.024
CAD 0.37
-14.9%
1380.0%
0.029
CAD 0.35
-28.1%
1280.0%
0.040
CAD 1.67
-4.0%
1184.6%
0.202
CAD 1.58
-40.2%
1115.4%
0.040
CAD 0.11
-47.6%
1000.0%
0.012
CAD 4.81
-51.9%
912.6%
0.795
CAD 1.14
-13.0%
850.0%
0.052
CAD 0.33
-28.3%
842.9%
0.062
CAD 0.18
-25.0%
800.0%
0.008
CAD 0.09
-85.0%
800.0%
0.009
CAD 0.80
-13.0%
788.9%
0.198
CAD 0.27
-30.3%
783.3%
0.025
AUD 0.55
-14.1%
773.0%
0.110
CAD 1.17
-13.3%
735.7%
0.089
AUD 0.15
-21.1%
733.3%
0.008
CAD 5.47
-2.0%
728.8%
0.539
USD 3.04
-0.3%
700.0%
0.319
AUD 1.20
-15.5%
700.0%
0.158
AUD 0.34
-14.1%
679.1%
0.035
CAD 0.16
-72.3%
675.0%
0.025
USD 7.60
-17.8%
660.0%
2.394
CAD 0.19
-32.1%
660.0%
0.004
CAD 0.30
-20.0%
650.0%
0.008
CAD 0.45
-40.8%
650.0%
0.025
CAD 0.08
-60.5%
650.0%
0.022
CAD 0.30
-18.1%
637.5%
0.067
USD 2.64
-34.0%
632.7%
0.075
CAD 0.15
-78.4%
625.0%
0.004
CAD 0.79
-21.0%
618.2%
0.021
CAD 6.40
-17.5%
611.1%
1.358
HKD 13.08
-11.7%
603.2%
0.738
AUD 0.04
-20.5%
600.0%
0.101
USD 0.35
-86.0%
600.0%
0.032
CAD 3.61
-44.0%
581.1%
0.172
GBP 0.14
-49.1%
575.0%
0.068
CAD 4.98
-3.1%
555.3%
0.259
CAD 1.95
-8.0%
550.0%
0.047
USD 1.43
-25.5%
550.0%
0.119
CAD 0.13
-88.5%
550.0%
0.037
CAD 0.64
-36.0%
540.0%
0.014
CAD 2.74
-25.5%
537.2%
0.143
GBP 5.88
-20.7%
531.7%
6.906
AUD 2.59
-6.5%
531.7%
0.355
CNY 64.58
-4.2%
523.1%
7.475
CAD 0.40
-31.0%
515.4%
0.117
CAD 3.75
-13.8%
514.8%
0.221
CAD 0.25
-85.1%
512.5%
0.144
CAD 0.70
-33.3%
508.7%
0.038
USD 0.72
-25.0%
500.5%
0.070
CAD 0.30
-14.3%
500.0%
0.063
CAD 0.60
-18.9%
500.0%
0.046
CAD 0.15
-21.1%
500.0%
0.014
USD 2.32
-13.8%
480.0%
0.496
CAD 0.15
-32.6%
480.0%
0.021
CAD 0.26
-58.1%
477.8%
0.018
AUD 0.11
-12.5%
452.6%
0.100
GBP 0.56
-12.2%
443.9%
0.107
AUD 0.32
-12.3%
442.4%
0.043
CAD 0.80
-5.9%
433.3%
0.028
CAD 0.08
-36.0%
433.3%
0.005
CAD 1.85
-9.3%
428.6%
0.215
AUD 0.72
-10.0%
421.7%
0.039
CAD 0.78
-22.0%
420.0%
0.046
AUD 0.67
-24.7%
415.4%
0.084
CAD 0.34
-28.7%
415.4%
0.034
CAD 1.80
-29.1%
414.3%
0.041
CAD 7.05
-6.6%
403.6%
1.661
CAD 0.15
-63.4%
400.0%
0.004
CAD 1.01
-36.9%
392.7%
0.066
USD 10.74
-6.7%
383.8%
3.940
CAD 0.29
-27.5%
383.3%
0.010
AUD 0.38
-56.7%
380.8%
0.716
CAD 2.88
-7.1%
380.0%
0.555
CAD 0.12
-67.6%
380.0%
0.005
CAD 0.19
-53.7%
375.0%
0.009
AUD 0.33
0.0%
371.4%
0.020
CNY 61.48
-6.3%
365.8%
6.404
USD 0.23
-84.7%
360.0%
0.013
AUD 0.37
-13.1%
356.3%
0.127
CAD 9.23
-9.1%
348.1%
0.478
CAD 0.16
-44.6%
342.9%
0.008
CAD 0.11
-73.8%
340.0%
0.005
USD 3.06
-6.7%
337.1%
0.453
AUD 1.85
-13.6%
335.3%
0.772
CAD 2.25
-28.3%
332.7%
0.088
CAD 32.44
-4.6%
332.5%
1.097
CAD 4.00
-50.9%
330.1%
0.116
AUD 0.43
-10.4%
330.0%
0.059
CAD 2.45
-4.3%
329.8%
0.570
AUD 0.06
-33.3%
328.6%
0.036
CAD 0.30
-36.2%
328.6%
0.013
CAD 0.77
-57.2%
327.8%
0.054
GBP 6.61
-41.4%
323.7%
1.854
Averages/total
-29.1%
791.3%
45.117
Weighted averages
-18.9%
467.9%
* 12-month
Source: market data; table compiled by Barry Sergeant
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