It can't hold anything good for them.

Reason #2: Gold stocks are grossly undervalued. Gold stocks aren't just inexpensive, they're stupid cheap. Their current undervaluation is more than just compelling… it's fire-sale attractive. It should have your full attention.

Just look at the data and you'll see what I mean:

• Relative to gold, the equities have not been this cheap since the waterfall selloff in 2008. The HUI/gold ratio is roughly 0.27, close to its bottom of 0.24 in October 2008. It hovered between 0.50 and 0.60 for most of a five-year period from 2003 to 2007, and exceeded 0.60 several times.
• On average, and in spite of weak gold prices at present, industrywide margins are roughly $1,000 per ounce. The price of gold wasn't even $1,000 30 months ago.
• As a group, gold stocks are selling for less than their net asset value… by 20%. They traded 60% above their NAV in 2007, a common level for precious metals equities.
• Average P/E ratios of the 10 largest gold producers are less than half what they were just two years ago.
• As we mentioned a few weeks ago, for a $1,000 investment right now, you can get about 0.6 ounces of gold. For the same $1,000, however, you'd get four ounces of gold by buying shares of Goldcorp or more than five ounces by buying Eldorado Gold.

This undervaluation cannot and will not last. Even the trader who knows nothing about Newmont or Barrick or Goldcorp will sooner or later want to jump on this – and if he doesn't, his boss will want to know why. Read what one Sprott fund manager thinks about gold stocks