Gold Miners about to eat it?

[DFF]

Almost perfect head n' shoulders pattern near completion on monthly chart of GDX:

Assuming pattern completes, target will be around $17 per share...around the lows from the crash of 2008...

"Definition" of a head n' shoulders:

 

[squarepusher]

meh, looking to much into the charts imo

 

[DFF]

meh, looking to much into the charts imo

Well, I just checked Barrick Gold (ABX), Newmont Mining (NEM), and Anglogold Ashanti (AU)...and ALL missed earnings last quarter, and the quarter before that...so, that head n' shoulders may very well be legit...we'll see...

 

[ILUVRP]

head n' shoulders is a very strong signal , if the miners can't make money at 1700/oz gold they never will .

the only miner i would buy is one that pays a good dividend.

it seems all they do is borrow hugh sums of money .

i would rather buy the phy metal than the miners.

 

[osan]

head n' shoulders is a very strong signal , if the miners can't make money at 1700/oz gold they never will .

the only miner i would buy is one that pays a good dividend.

it seems all they do is borrow hugh sums of money .

i would rather buy the phy metal than the miners.

Any day, all day long.

 

[Seraphim]

Take the metal long before the miners, HOWEVER...

If you choose a politically stable region and (please, I cannot overstate the following)... CAN HOLD THE PHYSICAL STOCK CERTIFICATE IN YOUR POSESSION...

...you will find miners who, from their current prices will outperform gold by a very, very, very wide margin.

 

[Gaddafi Duck]

Or just buy mcewen mining and laugh @ everyone freaking out about gold miners.

I'm in awe how people run around with their heads cut off like picking the right company to invest in is so difficult. How hard is it to figure out?? Yes, if you're an idiot and bought Jaguar Mining when it was $8 and now it's $0.70 due to out of control costs, then you deserve to lose money. Not rocket science. Don't buy companies with a lot of debt, high operating costs, and bad management. Between the dilution and the expenses, no shareholder equity will be left.

That's why I like mcewen. No debt, CEO founded goldcorp and outperformed warren Buffett. And he owns 25% of his company.

Go ahead and buy the gold my miners are selling, and then laugh at them for being the suckers.

Oh, and I love the charts. Technical analysis is always a "oh yeah duh now it makes sense, see!" you think you're the only one doing it? Computers trade faster than your Scottrade account can. I have yet to see someone become a billionaire at trading technicals. Probably because fundamentals take time to research and few do it, which is why the most successful investors are fundamental investors...whereas all technicians do are look at a chart or two, ignore the dozens of other factors impacting the market, and buy or short. They don't care what they are trading.. Thats like buying and trying to flip cars based on a few basic details. Wait till someone who is smarter than you, who knows more about cars (stocks) than you, and you'll see the technicals fall apart.

I was watching fast money yesterday. I love how these traders are saying to be careful buying apple now...where were the technicians on apple 22% ago?????????????

 

[thoughtomator]

I'd stay away from miners of any metal, as the wave of nationalizations has already begun.

 

[cubical]

MUX has been a pretty terrible performer. Gaddafi, what do you like about it so much other than that the CEO has a big stake in it(which is very good).

The best way to play the "miners" is to buy the streamers/royalty companies. FNV, RGLD, SAND and a new one (and very undervalued imo) GRYCF. If you are a believer in silver go with SLW. These guys have their costs locked in and will move with gold. All, other than GRYCF, seem to be a bit overvalued at the moment so I will be buying physical for the foreseeable future. ANV is the only other traditional miner I really believe in.

 

[Gaddafi Duck]

MUX has been a pretty terrible performer. Gaddafi, what do you like about it so much other than that the CEO has a big stake in it(which is very good).

The best way to play the "miners" is to buy the streamers/royalty companies. FNV, RGLD, SAND and a new one (and very undervalued imo) GRYCF. If you are a believer in silver go with SLW. These guys have their costs locked in and will move with gold. All, other than GRYCF, seem to be a bit overvalued at the moment so I will be buying physical for the foreseeable future. ANV is the only other traditional miner I really believe in.

I've done great with mcewen. It's double from where I entered in. Plus, they got the best CEO in the business. He's merged two companies without destroying shareholder value. He's reiterated his support for providing a shareholder friendly dividend once production ramps up, oh, and not the 1% yield goldcorp and silver Wheaton toss to their shareholders. You might as well keep that money to buy back shares or do some capex. Don't bother sending me a check for 1%.

All I know is my CEO ain't raiding the treasury with ridiculous salaries, he won't do boneheaded buyouts where he grossly overpays for mediocre assets, and he's a good guy. How many ceo's worth over $250 million actually send you emails to RSVP to eat lunch with them while they do a slide show presentation in front of a group of a dozen other people? Not that it adds much investment appeal, but it demonstrates his character. They just finished a rights offering for shareholders, something extremely rare for American companies to do, and in the conference call he made his direct line personally available if shareholders, big or small, needed help converting their rights into shares priced at a 50% discount from the market share price. So, how bad is MUX performing for shareholders when mcewen just offered each shareholder the chance to buy more shares 50% lower than the share price? It's essentially a one time massive dividend if you decided to sell your rights. If not, you just bought shares at a substantial discount..

You won't find a better guy in any business. Buffett's too into his own jokes to bother thanking loyal small shot shareholders, and the other 99% of ceo's just care about the big bonus check and only make themselves available to the biggest shareholders.

 

[Steven Douglas]

Well, Goldman's telling its clients to dump gold.

Golden Showers As Goldman Tells Clients To Sell Gold
By: ZeroHedge | Wednesday, December 5, 2012 at 03:14 pm

It's around that time of day again - when precious metals are sold hard for whatever reason you care to come up with (collateral requirements, margin calls, alchemy perfected). However, today there is a more mundane reason: Goldman Sachs has suggested its clients sell Gold on the basis that the gold cycle will turn in 2013 thanks to improving US growth offsetting the need for further Fed easing. Of course, Goldman telling its clients to 'sell gold' means Goldman is...

If Goldman advises everyone to jump really high, I would advise everyone to get a shove instead, dig a foxhole, and jump into that.


Back to Buffet's Law: "...be fearful when others are greedy and greedy only when others are fearful."

 

[cubical]

I've done great with mcewen. It's double from where I entered in. Plus, they got the best CEO in the business. He's merged two companies without destroying shareholder value. He's reiterated his support for providing a shareholder friendly dividend once production ramps up, oh, and not the 1% yield goldcorp and silver Wheaton toss to their shareholders. You might as well keep that money to buy back shares or do some capex. Don't bother sending me a check for 1%.

All I know is my CEO ain't raiding the treasury with ridiculous salaries, he won't do boneheaded buyouts where he grossly overpays for mediocre assets, and he's a good guy. How many ceo's worth over $250 million actually send you emails to RSVP to eat lunch with them while they do a slide show presentation in front of a group of a dozen other people? Not that it adds much investment appeal, but it demonstrates his character. They just finished a rights offering for shareholders, something extremely rare for American companies to do, and in the conference call he made his direct line personally available if shareholders, big or small, needed help converting their rights into shares priced at a 50% discount from the market share price. So, how bad is MUX performing for shareholders when mcewen just offered each shareholder the chance to buy more shares 50% lower than the share price? It's essentially a one time massive dividend if you decided to sell your rights. If not, you just bought shares at a substantial discount..

You won't find a better guy in any business. Buffett's too into his own jokes to bother thanking loyal small shot shareholders, and the other 99% of ceo's just care about the big bonus check and only make themselves available to the biggest shareholders.

You must have gotten in at the very bottom.

Diluting the shares, even if everyone gets part of the shares, doesn't increase share holder value. It's just like a stock split.

 

[oyarde]

If you are going to mess in mines , unless it is just gambling money, you , instead, invest who sells the mining equipment, this way you are out of picking winners/losers , the winners still buy . I usually ask for a case of beer for this....

 

[Gaddafi Duck]

You must have gotten in at the very bottom.

Diluting the shares, even if everyone gets part of the shares, doesn't increase share holder value. It's just like a stock split.

I got in 4 cents from the bottom. Lucky, I guess. He didn't dilute shareholders. Dilution is when you issue more shares, but don't allow access to all shareholders. The rights offering allowed shareholders to purchase more shares proportional to their current ownership, or they can sell the rights and treat it like a dividend. In the end, you aren't adversely affected. Dilution does adversely affect you.

 

[Gaddafi Duck]

Plus, stock splits are smoke and mirrors. This raised capital for further capex and exploration in a high grade deposit. It would not have been needed, however, had it not been for Argentinian politicians being anti foreigners. Regardless, most of mcewens assets aren't in Argentina.

 

[ILUVRP]

the only miner i would buy is one that the company insiders are buying , most are selling .

 

[jclay2]

For the love of all things holy, don't buy the miners...don't buy the miners...don't buy the miners!!!! Look at the 5/10 year historical performance of Gold vs Mining stocks. Gold has stomped the performance of the miners and will likely do so in the future. Why? Here are a couple reasons:

1. Not all miners are unhedged to the price of gold.
2. Increased energy and labor costs are squeezing them.
3. There is always risk that your mines get nationalized or risk strike.
4. GDX is much more driven by what the overall market is doing. If there is a crash, GDX will get hammered.

The last point should be especially concerning to most around here. If you are holding gold to be a store of value in the "oh shit" event, the actual metal will perform infinitely better than gold stocks. So please....please....please, buy the physical and leave the casino to the muppets.

There are exceptions to this, if you are willing to put the work in but for the average investor just buy the physical along with guns/ammo and call it a day.

 

[Arklatex]

I too would rather have the Gold than participate in the house rules paper gambling ring.

 

[Jordan]

Miners are a joke. They spend all their operating cash flows on capex and acquisitions. Companies in that space are terrible for investors.

 

[cubical]

I got in 4 cents from the bottom. Lucky, I guess. He didn't dilute shareholders. Dilution is when you issue more shares, but don't allow access to all shareholders. The rights offering allowed shareholders to purchase more shares proportional to their current ownership, or they can sell the rights and treat it like a dividend. In the end, you aren't adversely affected. Dilution does adversely affect you.

The shares are still diluted. AKA your share of the company has gotten smaller unless you pay up.