Gold Digger: The big boys are bullish
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Northern Star (ASX:NST) boss Bill Beament is more confident about gold than at any time his career, he told reporters at the annual Diggers & Dealers conference in Kalgoorlie.
PCF Capital managing director Liam Twigger called it the “best market for commodities and capital since the 1960s”.
The recent $16bn Northern Star and Saracen merger has sparked something, Twigger says.
“A lot of capital has come into the market in recent months but the merger and acquisition (M&A) space has been quiet, until now,” he says.
“The industry is small enough that everyone has gone around and around enough times.
“Everyone knows everyone else and knows they are watching. I think there has to be more [consolidation] and we will see some more deals.”
But Regis Resources (ASX:RRL) managing director Jim Beyer warns against M&A that will not stack up if the gold price tumbles.
“The nature of our industry is cyclic, we know it,” he told reporters on the sidelines of the Diggers and Dealers.
“If you look at the globe and the way things are unfolding there’s probably a number of reasons why we should expect the cycle will last a number of years.
“A rising tide floats all boats. [But] what’s going to happen when the tide goes out?
“We need to make sure we haven’t done something that puts our shareholders and our fundamental business at risk.”
Something investors should keep in mind. Meanwhile, the trend is clear — sentiment remains high.
In February, 19 per cent of ASX gold stocks on our list had gained 100 per cent or more over the preceding 12 months.
In June, that number had increased to ~27 per cent. By July it was +40 per cent.
That statistic has stayed reasonably steady since, with 38 per cent of the 200 stocks now on our list making gains of 100 per cent over the last year.
And it was another good week for ASX gold stocks. 126 went up, 44 went down, and 30 didn’t move.
Here’s how 200 ASX-listed gold stocks performed October 12 – October 16 [intraday].
Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop:
A presentation by Ausgold (ASX:AUC) at Diggers & Dealers this week included a sneaky comparison with other WA-based, one million ounce gold explorers to demonstrate how undervalued it was.
Investors responded positively, sending the stock up 61 per cent.
Investors agreed, sending the stock up ~45 per cent to +2 year highs.
Dampier Gold (ASX:DAU) made a new gold discovery with a wide spaced, early stage drilling program at the greenfields (unexplored) Browns Dam prospect, part of its flagship Zuleika project in WA.
And Ardiden (ASX:ADV) has outlined a number of mammoth gold targets at the New Patricia property in Ontario, including a structure which is larger than the Super Pit in Kalgoorlie.
Here’s the Super Pit, for scale:
Stockhead constantly updates our list of ASX gold stocks to be as accurate as possible for investors. If you spot companies that should be added (or removed) please let us know at: [email protected]