Gold Stocks Steady, Randgold (GOLD) Started at Buy
GOLD STOCKS NEWS – Gold stocks fluctuated between gains and losses on Wednesday as the Market Vectors Gold Miners ETF (GDX) held near unchanged at $43.89 per share in mid-day trading. The stability in gold stocks and the GDX came coincided with modest rebound in COMEX gold futures, which rose 0.2% to $1,605.60 per ounce following an overnight slide to $1,592.10. The S&P/TSX Global Gold Index, Canada’s leading gold stocks composite, held steady near 290.60 in concert with the GDX.
The gold stocks sector received an extra bit of attention today due to the release of the latest 13-F filing by Paulson & Co., the hedge fund run by billionaire John Paulson. According to the filing – dated June 30, 2012 – Paulson’s firm added 4.0 million shares to its position in NovaGold Resources (NG), a Canadian-based exploration company that holds an interest in the Donlin Gold deposits in Alaska. The firm also added 500,700 shares of Allied Nevada Gold (ANV).
Paulson & Co. did reduce his holdings of two other gold stocks, however. The firm cut its holdings of AngloGold Ashanti (AU) by 400,540 shares, but the company remained Paulson’s second-largest equity holding. Paulson also lowered his position in Gold Fields (GFI) by 819,000. Among other gold stocks, Paulson’s holdings of Barrick Gold (ABX) and IAMGOLD (IAG) remained unchanged.
In total, Paulson & Co. had 44% of its U.S. equity holdings in gold-related securities at the end of the second quarter of this year. This compared to 33% as of March 31st and 25% as of June 30, 2011. The recent additions reflected comments that the billionaire investor made this past April, where he reiterated his bullish outlook on gold stocks and contended that the sector was historically inexpensive.
Another gold stock and GDX component in the headlines on Wednesday was Randgold Resources (RRS.LSX, NASDAQ: GOLD). GMP Securities initiated coverage of the large-cap gold producer with a Buy rating and 6800 pence (approximately $107) price target.
In the firm’s report, GMP analyst Brock Salier wrote that his target is “Based on 1.5x NAV (net asset value) using US$1,575/oz gold. Despite the high NAV multiple, we estimate that Randgold trades at 5.7x FY12 P/CF vs. a Tier II (500k-2Moz pa) peer group average of 11.6x. We are very positive on the medium-term growth of the company, so have confidence in our forecast that P/CF drops to 3.2x by FY14.”
Despite the positive commentary, shares of GOLD dipped 0.3% to $96.49 in mid-day trading. Other notable gold stocks in the red included GDX Newmont Mining (NEM) and Yamana Gold (AUY) – which fell by 0.7% to $46.03 and by 0.5% to $14.98 per share, respectively.
2012-08-15 09:41:50
Source: http://www.goldalert.com/2012/08/gold-stocks-steady-randgold-gold-started-at-buy/
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