The Curiosity that is the Gold Stock Sector
For the past several years, the biggest mystery for followers of gold is and continues to be the abject performance of those companies that mine the metal. Mid-October 2010 sees gold at an all-time high and silver at a 30 year high. Yet, how many of the large and mid-tier precious metal miners are hitting record highs? Almost none!
So, this week we started making some calls to the miners themselves to search for explanations. The answers we received were useless. Investor relations personnel are not traders. They have no idea how the market trades today and that’s too bad. The share price is their currency and unless you’re a Central Banker, most CEOs want their share price higher. Nevertheless, we remained undeterred and started to search for answers.
Let’s go to analyst estimates:
Earnings Estimates Table (click on link)
As the table above shows, Wall St is no fan of this sector. There is simply no way that “analysts” can possibly be this stupid. The price of gold (POG) and the price of silver (POS) have had massive moves the past 90 days but the analysts have remained silent. This is undeniably deliberate on their part. Why? I have no idea but if you look at FCX, which is now primarily copper, they have had a huge run up in estimates.
In discussing this with management of a few companies listed above, there is never a logical explanation given. Also, why exactly have these companies remained silent during this quarter? How about raising guidance? I have begged them to do so but can find not a solitary example of a miner raising estimates this quarter.
What is happening here in this sector is completely unacceptable. One is left to wonder whose side management is on, that of the banks or their shareholders.
Sabregold
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Xiphos Note: I’m tired of this BULLSHIT. The CEOs of these companies are either some of the most incompetent rock heads or they are bought off. I say CEOs should HALT THE TRADING in these stocks and examine who owns what and all the trades over the last 30 days made completely public for all to analyze. I will dig through this tape and tell you WTF is going on and I suspect several illegal manipulations are there begging for class action lawsuits. Where do I sign up? Hands down the most manipulated sector on the planet as we’ve said time and again. We need to organize something against these clowns.
