MoneyTalks: Gold’s re-rating gathers pace as Australia’s energy crisis sparks a new opportunity

MoneyTalks is Stockhead’s drill down into what stocks investors are looking at right now. We’ll tap our list of experts to hear what’s hot, their top picks, and what they’re looking out for.

In this edition, we hear from Perennial Value Management portfolio manager and resources analyst Sam Berridge.

According to Perennial Value Management’s Sam Berridge, market sentiment continues to favour gold strongly as we head into 2026, with structural weaknesses in the US budget and relentless money-printing expected to push the metal to even greater highs.

He said the market dislocation between gold equities and the underlying price is creating a rare buying window, as developers with scalable production potential stand to re-rate amid rising margins and tightening global supply.

At the same time, Australia’s energy policy is amplifying another major investment theme, the urgent need for dispatchable power to stabilise a grid increasingly strained by volatile pricing and soaring demand from data centres.

Berridge noted the strongest risk-adjusted return may lie in an ASX infrastructure play, where Australia’s worsening power volatility and hard-to-access turbine capacity have formed a defensive investment moat.

But first, gold

The analyst believes the setup for gold remains deeply bullish because the forces driving its rise are structural rather than speculative.

“The gold price has been rising pretty steadily for the last 10 years,” Berridge said, noting similarities to critical turning points in 1933 and 1971, when the US was “going broke” and was forced to revalue the currency against gold.

He argued that history is now repeating, and without serious budget repair, the US will face another reckoning.

“The US is well on its way to going broke again and it can either start printing more money and adopt quantitative easing forever, or they can take some bitter medicine by way of austerity and balance their budget, which would be very unpalatable,” he reasoned.

“If they do go down the quantitative easing path, it undermines the value of the US dollar and conversely inflates the price of anything that’s valued in US dollars, and that includes the entire commodity spectrum but specifically gold, which will probably be the first beneficiary.”

Berridge expects that re-rating to spill over into other commodities, too, but he said gold will lead the pack.

Two under-the-radar IPOs

Against this backdrop, Berridge sees exceptional value in PC Gold (ASX:PC2) and Sentinel Metals (ASX:SNM).

Both stocks are recent IPOs that he believes are flying under the radar despite controlling the “best part of a million ounces” each.

The analyst recently ran the numbers on a standard mid-tier production scenario.

“Two years ago, a 100,000 ounce per annum project had an NPV of about $300-$350 million,” he explained.

“Now it’s comfortably over $1 billion.

“To develop an operation producing 100,000 ounces per annum, companies need about a million ounces in reserve to support that and with the additional funding that these two have raised, there is certainly a line of sight to get past one million ounces in resource and support close to a million ounces in reserve.”

He noted that the opportunity comes from chasing projects that have been off the market or tucked away privately for years, then securing them at a value that makes sense.

“Those companies are highly likely to receive funding to go into development because the returns from gold mines now are similar to the margins that you get from software companies. The margins are massive.”

PC Gold and Sentinel Metals

For PC Gold, the key advantage lies in infrastructure proximity.

Its Spring Hill gold project is about 26km from Agnico-Eagle’s processing mill in the NT, currently idle but accessible via commercial agreement.

Berridge said the ability to secure toll treatment could accelerate the pathway to production considerably.

“There’s a potential for a deal to be done there and bring that mine into production relatively quickly, albeit the mill needs to be refurbished.”

Meanwhile, Sentinel Metals is advancing drilling and preparing an updated resource early next year at its Columbia project in Montana, a historically productive gold region.

“In the past, Montana has been seen as a little problematic for permitting but under the Trump administration, permit approvals in the US are happening much faster than they are in Australia.

“Due to that relative improvement in permitting risk, I think you should see projects in the US move forward a bit faster.”

The Perennial Value analyst’s catalysts for Sentinel Metals include drilling results and an update to resources planned next year, while in PC Gold’s case there’s the possibility of doing some sort of deal to get access to that mill, which would provide a path to early production.

Power crunch lights up an opportunity

At the same time, a backdrop of turbine shortages, five-year equipment wait times and gas scarcity on the East Coast has positioned infrastructure plays like QPM Energy (ASX:QPM) to benefit from chronic power insecurity.

“With increasing frequency, power prices are peaking to extreme levels and it’s a trend that has been getting steadily worse over the last 10 years and is really starting to become quite acute,” Berridge said.

“The opportunity here is for flexible dispatchable power generation … and the technologies which offer dispatchable generation are batteries for hours, then gas.”

But the squeeze is being intensified by soaring energy demand from data centres, which are competing for grid access and hardware, delaying new supply.

The result is a bottleneck unlike anything seen in decades.

New gas turbines now have wait times of up to five years, exacerbated by rising equipment prices.

“Private equity in Australia saw the opportunity QPM is exposed to, secured an option on two turbines a few years ago, and went looking for gas supply but was eventually forced to on-sell those turbines to QPM because of the gas shortage,” Berridge added.

“So, if you take a step back and just have a look at the moat around this business model, we’ve got structurally higher power and more volatile prices and it’s a problem that is getting worse.

“A big part of the solution will be gas peaking generators but there’s no gas turbines available and there’s no gas.

“It’s quite a moat that QPM has around its business and it’s quite rare to be able to gain access to gas-to-power exposure in the small cap space because these assets predominantly sit inside the major utilities.

“I suspect QPM will end up sitting inside a larger company at some point because the ability to put your hand on either turbines or spare gas reserves is quite rare.”

QPM ready to re-rate

Berridge noted that the attraction for investors comes down to earnings growth, noting that QPM’s earnings are expected to double once the two additional turbines are brought online in early 2027.

“It will be the lowest-cost east coast gas peaking facility in Australia and they should be producing around 70 to 80 million dollars of EBITDA per annum,” he said.

Because it functions as a utility, those earnings should remain relatively predictable across the asset’s 30-year life.

According to Berridge, that stability means QPM is likely to trade on a utility-style earnings multiple over time.

At Stockhead, we tell it like it is. While QPM Energy is a Stockhead advertiser, it did not sponsor this article.