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Unlike their large and mid-cap counterparts — who are making cash hand-over-fist — ASX-listed small cap gold miners and explorers had a rough 2018.

But things could turn around in 2019, as positivity starts to return to the gold sector in general.

After hitting a year-high of $US1365 in January it’s mostly been downhill for the gold price, which bottomed out at $US1161 in August.

It has since rebounded to just above $US1230, which has helped inject a bit life into the small cap space.

In the past 6 months, more than 82 per cent of small cap gold stocks have lost ground, with only 16 per cent making gains.

Last month, this had improved substantially — just 55 per cent lost ground, while 47 per cent had made share price gains.

 

Scroll down for a list of small cap gold stocks and how they have performed over the past year>>>

 

Entering 2018, sentiment around the gold price was pretty soft, resources expert Gavin Wendt says.

This was because the US was raising interest rates, which usually results in a stronger US dollar.

“This isn’t good for gold prices, because the US dollar and gold typically move in opposite directions,” Mr Wendt says.

“Investors didn’t have high hopes for gold on that basis alone.”

The US dollar gold price versus the Australian dollar gold price in 2018.
The US dollar gold price versus the Australian dollar gold price in 2018.  Source: Argonaut

Australia’s big gold miners were big winners

But currency movements are key to the profitability of Australian gold producers, who benefit when the Australian dollar weakens relative to the US dollar gold price.

For example, while US producers may get $1300 per ounce, Australian producers will make close to $1700 for the same amount of gold.

This means a strong US dollar is  great for the larger Australian gold miners, Mr Wendt says.

“What we’ve seen this year is a continuation of what we have seen over recent years – while US dollar gold prices can be somewhat up and down, the Australian gold price has been extremely strong,” Mr Wendt says.

“That has flowed through to the bottom line of many of our domestic producers – who have generated very strong margins.

“They have accumulated a lot of cash because of the strong Australian gold price.

“They have deployed that cash in various ways – given back to shareholders, organic growth, and been aggressive in takeovers and acquisitions.”

The bottom line? From a share price perspective, Australian mid-tier gold miners have been star performers.

 

Small caps have been doing it tough

But for the smaller gold companies it has been tough, for a few reasons.

For starters, some small cap miners have experienced issues while ramping up operations. That tends to affect sentiment at the smaller end of the market, Mr Wendt says.

“It’s a risky business, and what we have seen in the gold space is some companies ‘strike an iceberg’,” he says.

“That is something the market never likes.

“Other companies who are aspiring producers tend to be impacted by the prevailing negative sentiment.”

More broadly, the volatile market is making it hard for junior resources stocks to raise money.

A number of gold IPOs over the past few months are struggling to make headway, with many having lost ground since their debuts.

Mr Wendt said this didn’t have anything to do with gold specifically – these companies were just listing in a climate that was quite weak across the spectrum.

“Floats can be very sentiment driven. When the market is riding high, you see strong demand for IPOs — but the reverse is also true,” he said.

Argonaut analyst James Wilson agrees that in general, while mid-cap gold miners have gone up, micro-cap explorers have gone down – purely as a result of capital flight away from “more speculative investments”.

“People don’t want to wear that sort of exploration risk at the moment, they are happy to put their money into companies like [mid-cap miner] Northern Star because they can see returns,” Mr Wilson says.

“There’s less funds available to put into speculative investments at the moment.”

2019 Outlook

Hedley Widdup, director of junior resources focused investment firm Lion Selection Group, believes the current market volatility has provided an opportunity for instos to take a bigger position and for new investors to join the register in junior miners more generally.

“I suspect it’s one of those things where quite a few investors who might have missed the 2016/17 run see an opportunity now and wouldn’t mind holding some positions,” he told Stockhead recently.

“Groups that are already in would definitely see it as an opportunity. Groups that weren’t in I would say almost certainly are looking at it saying, ‘well if we missed it the first time maybe now is the time’.”

And Mr Wendt is also more positive on the outlook for gold in 2019.

“While the US Federal Reserve will probably raise rates at the end of the year, they have made it very clear that they are becoming more “dovish” – that is, they are more likely to ease the pace of these interest rate increases,” he says.

This had an immediate impact on the value of gold, and junior gold stocks.

“Since those comments were made a week or two ago, gold has found significant price support,” Mr Wendt says.

“I think it will go into 2019 in a positive frame of mind.”

 

Here’s a list of small cap gold stocks and how they have performed over the past year:

Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop

ASXCodeNameShare Price in cents (Dec 4)% Return: One Month% Return: 6 Months% Return: 12 Months Market Cap: (Dec 4)
MOH MOHO RESOURCES 12000 $5,098,151
CY5 CYGNUS GOLD 90.034483-0.4705880 $5,461,501
MKG MAKO GOLD 12.50.041667-0.3589740 $7,273,762
NES NELSON RESOURCES 170.03030300 $7,323,656
BC8 BLACK CAT SYNDICATE 15.5-0.162162-0.4833330 $8,875,300
KWR KINGWEST RESOURCES 15.5-0.11428600 $8,891,750
GBM GBM GOLD 0.8000 $8,946,556
GML GATEWAY MINING 1.3-0.125-0.4814810 $11,017,152
CM1 COOLGARDIE MINERALS 12-0.0400 $12,416,491
STN SATURN METALS 23-0.1481480.2105260 $12,880,000
TIE TIETTO MINERALS 7.20.028571-0.5636360 $17,774,868
KRM KINGSROSE MINING 5.60.090909-0.20 $42,340,428
BBX BBX MINERALS 17.5-0.027778-0.1250 $63,458,780
NWF NEWFIELD RESOURCES 160.32-0.1315790 $93,007,928
ONX ORMINEX 250.1860461.550 $142,716,864
VAN VANGO MINING 15-0.142857-0.06252.571429 $104,261,456
GCR GOLDEN CROSS RESOURCES 5.4-0.2285713.1538461.571429 $5,487,601
MDX MINDAX 1.20.3750.3751.2 $9,118,164
CYL CATALYST METALS 1910.1454550.6651980.909091 $134,807,888
BGL BELLEVUE GOLD 430.0751.2051280.829787 $199,065,744
DRM DORAY MINERALS 32.25-0.111111-0.0153850.72973 $138,472,480
BGH BLIGH RESOURCES 4.60.0697670.3142860.642857 $13,151,957
DGR DGR GLOBAL 14-0.0333330.559140.45 $85,845,464
CAY CANYON RESOURCES 210.1891891.4175820.419355 $81,900,824
SLR SILVER LAKE RESOURCES 47.5-0.086538-0.2016810.41791 $241,282,048
DAU DAMPIER GOLD 4.20.024390.40.4 $6,956,886
GUL GULLEWA 2.90.380952-0.0333330.380952 $4,353,570
LNY LANEWAY RESOURCES 0.40.3333330.33333333.3333 $10,564,698
TLM TALISMAN MINING 303.389817.307732.6087 $53,852,964
AGS ALLIANCE RESOURCES 12-7.692337.93131.8681 $13,036,740
BSR BASSARI RESOURCES 25.2632-9.090925 $45,745,860
RED RED 5 7.920.6897-2.777825 $86,939,512
DMG DRAGON MOUNTAIN GOLD 1.1-15.3846-31.2522.2222 $2,898,836
SIH SIHAYO GOLD 1.70021.4286 $31,522,462
TRY TROY RESOURCES 1221.2121-2021.2121 $53,064,072
GWR GWR GROUP 11-32.2581-4016.6667 $29,036,858
AOP APOLLO CONSOLIDATED 2521.951251.515116.2791 $42,732,368
PRU PERSEUS MINING 35.5-4-18.181810.7692 $362,233,024
TBR TRIBUNE RESOURCES 478-4.417.014810.1316 $239,481,872
AAR ANGLO AUSTRALIAN RESOURCES8.49.0909-6.66676.3291 $27,052,444
RND RAND MINING 194-15.65223.9535.8781 $117,289,528
RMS RAMELIUS RESOURCES 40-7.0588-33.61343.9474 $203,508,832
MOY MILLENNIUM MINERALS 18-13.63648.57142.7027 $150,507,552
DTM DART MINING 0.80-12.52.5641 $5,996,300
SBU SIBURAN RESOURCES 0.3000 $2,093,496
AYR ALLOY RESOURCES 0.40-500 $6,308,311
ADN ANDROMEDA METALS 0.7-12.5-6.66670 $6,476,170
CTO CITIGOLD CORP 0.6-25-33.33330 $12,897,814
IRC INTERMIN RESOURCES 14.5-6.4516-9.3750 $35,308,268
BCN BEACON MINERALS 1.7-10.526300 $37,691,304
ORN ORION MINERALS 2.97.4074-36.95650 $52,464,536
BNR BULLETIN RESOURCES 3.30-8.1081-2.8571 $6,095,965
AZM AZUMAH RESOURCES 2.116.6667-34.375-4.5455 $17,207,368
ALY ALCHEMY RESOURCES 1.50-4.691-4.691 $6,606,292
CGN CRATER GOLD MINING 1.9-29.62965.5556-5 $5,309,831
SMC STRATEGIC MINERALS CORP 310-6.0606 $24,244,854
HRN HORIZON GOLD LIMITED2215.789537.5-8.3333 $16,836,736
VEC VECTOR RESOURCES 1.9-9.5238-5-9.5238 $25,368,956
ARE ARGONAUT RESOURCES 2.638.888919.0476-10.7143 $40,413,896
EXU EXPLAURUM 8.6-19.0476-10.5263-13.2653 $42,364,284
ERM EMMERSON RESOURCES 7.1-1.3889-22.8261-13.4146 $29,063,442
HHM HAMPTON HILL MINING 2.652.9412-21.2121-16.129 $7,664,940
CHN CHALICE GOLD MINES 11.5-1.07539.5238-17.1171 $33,321,016
GED GOLDEN DEEPS 3.9-17.64712.439-17.6471 $7,026,613
OKU OKLO RESOURCES 28.59.6154-16.1765-18.5714 $93,639,056
MSR MANAS RESOUCES 0.40-11.1111-20 $13,215,812
CAI CALIDUS RESOURCES 3.13.3333-26.1905-20.5128 $41,149,652
AUC AUSGOLD 2.64-10.3448-21.2121 $16,428,739
PRX PRODIGY GOLD 7.7-9.4118-26.6667-22.2222 $33,541,302
NAG NAGAMBIE RESOURCES 6.5-12-64.3243-22.3529 $28,761,334
LTR LIONTOWN RESOURCES 2.623.8095-27.7778-23.5294 $28,349,686
BRB BREAKER RESOURCES 38-8.433740.7407-24 $70,335,456
MML MEDUSA MINING 31.5-7.5758-50.4065-24.6914 $64,416,232
KGD KULA GOLD 211.1111-20-25.9259 $7,513,161
ARX ARC EXPLORATION 1911.7647-36.6667-26.9231 $4,797,639
TLG TALGA RESOURCES 44.5-6.4516-45.283-27.5 $97,976,184
TAM TANAMI GOLD 30-18.4211-27.907 $36,428,008
GMN GOLD MOUNTAIN 99.7561-14.2857-28 $45,847,700
EGA EGAN STREET RESOURCES 208.1081-21.5686-28.5714 $26,090,744
SFM SANTA FE MINERALS 8.5-26.087-69.0909-29.1667 $6,189,597
WAF WEST AFRICAN RESOURCES 29.55.3571-11.9403-29.7619 $207,247,424
NXM NEXUS MINERALS 5-1.9608-28.5714-30.5556 $4,428,679
BAR BARRA RESOURCES 3.5-10.2564-30-31.3725 $18,322,286
CDV CARDINAL RESOURCES 38.5-10.2273-13.1868-31.8965 $152,037,120
PLL PIEDMONT LITHIUM 12-7.6923-29.4118-33.3333 $69,903,792
DEG DE GREY MINING 13-7.4074-35.8974-34.2105 $53,591,472
EMR EMERALD RESOURCES 2.9-9.6774-28.2051-34.8837 $68,253,816
PGI PANTERRA GOLD 2.2-21.4286-10.4436-35.3204 $4,455,026
ALK ALKANE RESOURCES 21-4.4444-23.2143-35.8209 $106,280,208
SAU SOUTHERN GOLD 17-17.0732-35.8491-37.037 $10,329,581
VKA VIKING MINES 1.6-15.7895-51.5151-38.4615 $5,019,486
MRP MACPHERSONS RESOURCES 8.1-2.439-6.9767-38.4615 $29,135,200
DGO DGO GOLD 68.55.3846-21.6528-39.5797 $17,223,328
TYK TYCHEAN RESOURCES 0.3-25-40-40 $1,731,470
HMX HAMMER METALS 2.2-29.0323-21.4286-40.5405 $6,400,833
AAJ ARUMA RESOURCES 0.716.6667-56.25-41.6667 $3,659,742
PM8 PENSANA METALS 1.8-5.2632-10-41.9355 $24,043,002
KGM KALNORTH GOLD MINES 0.4-33.3333-50-42.8571 $3,576,960
OVL ORO VERDE 0.5033.3333-42.8571 $7,778,393
ODM ODIN METALS 12.5-3.8462-37.5-43.1818 $19,214,916
FML FOCUS MINERALS 218.5714-33.3333-43.2836 $34,722,228
HAW HAWTHORN RESOURCES 4.5-8.1633-10-43.75 $14,697,703
TTM TITAN MINERALS 2.44.3478-35.1351-44.186 $61,528,944
BDC BARDOC GOLD 6.5-3.0303-34.6939-44.3478 $59,520,224
PEC PERPETUAL RESOURCES 1-60-60-44.4444 $2,379,204
NUS NUSANTARA RESOURCES 17-15-22.7273-46.0317 $20,943,604
WGX WESTGOLD RESOURCES 104-9.009-39.521-46.1333 $361,294,016
ARM AURORA MINERALS 2.1-16-22.2222-46.1538 $2,459,799
KTA KRAKATOA RESOURCES 2.70-22.8571-47.0588 $3,172,500
BLK BLACKHAM RESOURCES 4.3-2.2727-40.2778-47.9264 $57,659,196
AME ALTO METALS 3.9-20.4082-37.0968-48 $9,362,669
MAT MATSA RESOURCES 12.50-30.5556-48.9796 $22,114,672
BGS BIRIMIAN 20-18.3673-60.7843-49.3671 $46,712,140
FEL FE 1.70-50-50 $5,192,292
GBZ GBM RESOURCES 0.50-28.5714-50 $5,452,985
MLS METALS AUSTRALIA 0.30-50-50 $7,025,394
WWI WEST WITS MINING 1.220-36.8421-50 $8,614,172
SWJDA STONEWALL RESOURCES 8-11.1111-33.3333-50 $26,713,494
GME GME RESOURCES 7.6-18.2796-45.7143-50.6759 $36,642,656
E2M E2 METALS 6.5-1.5152-32.9897-53.5714 $3,946,016
RGL RIVERSGOLD 8.58.9744-29.1667-54.0541 $7,073,270
TMX TERRAIN MINERALS 0.4-20-42.8571-55.5556 $2,574,928
OKR OKAPI RESOURCES 21.519.4444-46.25-56.1224 $7,383,717
EAR ECHO RESOURCES 11.75-6-55.6604-56.4815 $56,194,336
TAR TARUGA MINERALS 5.5-8.3333-75.5556-59.2593 $7,764,198
SHK STONE RESOURCES AUSTRALIA 0.20-50-60 $1,605,754
GBR GREAT BOULDER RESOURCES 14.5-19.4444-54.6875-61.3333 $12,417,068
ARS ALT RESOURCES 2.6-18.1818-54.2373-61.4286 $6,636,997
KCN KINGSGATE CONSOLIDATED 17.5-8.3333-41.0714-61.6279 $38,458,408
ARL ARDEA RESOURCES 61.514.0187-39-61.6352 $64,569,104
OGX ORINOCO GOLD 0.95-50-90.3614-61.9048 $10,340,894
4CE FORCE COMMODITIES 1.9-9.5238-67.2414-62 $8,478,317
GMR GOLDEN RIM RESOURCES 1.8-10.5263-57.5-63.0435 $6,748,877
CVS CERVANTES CORP 0.5-37.5-44.4444-64.2857 $2,473,417
AVW AVIRA RESOURCES 0.30-64.2857 $3,000,000
AUT AUTECO MINERALS 0.450-25-66.6667 $2,707,394
PDI PREDICTIVE DISCOVERY 1.3-27.7778-40.9091-68.2927 $3,069,847
GCY GASCOYNE RESOURCES 110-78.0702-69.8795 $46,900,524
CDT CASTLE MINERALS 142.8571-52.381-71.4286 $2,237,960
CGM COUGAR METALS 0.30-50-72.7273 $2,858,408
TNR TORIAN RESOURCES 2.4-7.6923-47.8261-72.7273 $5,328,664
DHR DARK HORSE RESOURCES 0.50-77.2727-73.6842 $9,880,433
BDR BEADELL RESOURCES 4.5-20-36.2319-74.1176 $75,311,288
AQI ALICANTO MINERALS 3.712.1212-58.427-74.4828 $4,705,932
MDI MIDDLE ISLAND RESOURCES 0.5-33.0357-68.4874-76.7081 $3,838,458
SMI SANTANA MINERALS 0.620-40-77.1429 $3,352,677
A AMANI GOLD 0.5-16.6667-54.5455-77.2727 $8,057,652
PUA PURE ALUMINA 4.6-17.8571-43.9024-77.561 $8,212,365
BSX BLACKSTONE MINERALS 12-14.2857-55.5556-77.7778 $13,468,667
AWV ANOVA METALS 1.3-31.5789-77.9661-80.303 $8,308,720
DTR DATELINE RESOURCES 0.2-63.6364-83.3333-87.8788 $2,173,488