EXCLUSIVE: Value Investor Is 'Very Happy To Take Advantage' Of Top Gold Miner At Historical Discount
Portfolio Pulse from Piero Cingari
Value investors are targeting mining stocks, particularly gold miners like Newmont Corp (NYSE:NEM), due to a significant market dislocation. Taylor McKenna of Kopernik Global Investors highlighted the gap between metal prices and mining company valuations, noting gold stocks are at a 50-80% discount despite rising gold prices. Newmont Corp's stock has dropped 60% from last year, despite gold's 10% price increase. McKenna views this as an undervaluation, especially after Newmont's acquisition of Newcrest Mining. ETFs holding Newmont Corp include iShares MSCI Global Gold Miners ETF (NYSE:RING), VanEck Gold Miners ETF (NYSE:GDX), and others, indicating a broader market impact.
February 15, 2024 | 9:38 pm
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POSITIVE IMPACT
VanEck Gold Miners ETF, with a 13.20% weight in Newmont Corp, might benefit from the market's reassessment of NEM's value.
Given GDX's exposure to Newmont Corp, any positive revaluation of NEM due to its undervaluation could positively influence GDX's performance.
CONFIDENCE 75
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Newmont Corp's stock is considered undervalued by analysts despite a 60% drop from last year, with gold prices rising 10%. The acquisition of Newcrest Mining is seen as beneficial.
Given the significant undervaluation highlighted by McKenna and the strategic acquisition of Newcrest Mining, Newmont Corp's stock is likely to see positive short-term movement as investors recognize its value.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100
POSITIVE IMPACT
iShares MSCI Global Gold Miners ETF, holding a 19.05% weight in Newmont Corp, may see positive impact from the undervaluation of NEM.
As RING holds a significant weight in Newmont Corp, the ETF could experience positive price movement if NEM's stock price corrects upwards due to its undervaluation.
CONFIDENCE 75
IMPORTANCE 70
RELEVANCE 80