Unlocking Gold Mining's Supercycle: Insights From Benzinga's Virtual Conference

In the latest virtual conference presented by Benzinga, three outstanding experts and industry professionals gathered to explore the prospects of a new “Supercycle” for gold miners.

Delving into crucial factors affecting the performance of gold mining stocks, they discussed Fed interest rates, market valuations, geopolitics, ESG and technological innovation in the industry.

In the first part, Imaru Casanova, a portfolio manager for Gold and Precious Metals at VanEck, highlighted the potential bullish catalysts for gold miners and presented her top stock recommendations.

Taylor McKenna, CFA and an analyst at Kopernik Global Investors, emphasized the value of gold mining stocks and discussed the application of AI technologies.

Luke Norman, co-founder and executive chairman at US Gold Corp. USAU, offered insights into the gold mining exploration side and the permitting cycle.

VanEck Sees Attractive Valuations In The Gold Mining Industry

VanEck’s Casanova expressed optimism about the outlook for gold miners, citing the end of the Fed tightening cycle as a potential bullish catalyst.

With strong global support in the current environment, gold miners are poised to demonstrate their leverage with higher gold prices. Casanova highlighted the historically low multiples at which gold mining stocks are currently trading, coupled with controlled balance sheet costs, generate an attractive investment opportunity.

“When gold traded at these levels (around $1,970) in the past, stocks in the VanEck Gold Miners ETF GDX or VanEck Junior Gold Miners ETF GDXJ index were trading 15-20% higher,” Casanova said.

Regarding top stock recommendations, Casanova identified Endeavor Mining PLC EDVMF, Alamos Gold Inc. AGI, and Agnico Eagle Mines Ltd AEM. She emphasized that VanEck’s current price forecast for gold is $2,075 per ounce in the next 12 months, which offers a compelling case for diversification and growth in the gold mining sector.

Read Also: Agnico Eagle Mines’ Debt Overview

Kopernik Global Investors Is Bullish On Smaller Miners

Kopernik Global Investors’ McKenna expressed strong conviction in gold mining, pointing out the attractive valuations the sector offers. McKenna discussed the opportunity in smaller companies within the industry such as Seabridge Gold Inc. SA, International Tower Hill Mines Ltd. THM, and Western Copper and Gold Corp. WRN, which trade at even cheaper valuations than big miners but carry higher risk.

Among the majors he highlighted is Barrick Gold Corp GOLD offers attractive valuations as it shows an all-in-sustaining cost (AISC) of $1,400 an ounce, positioning the company for significant potential if gold prices continue to rise.

McKenna also stressed the importance of scrutinizing management teams and incentives, and he shared insights into how AI technologies, such as driverless trucks for mining, are being employed to boost productivity and reduce environmental impact.

US Gold Corp’s Vision for the Greenest Mine in North America

US Gold Corp.’s Norman shed light on the gold mining exploration and permitting cycle. He emphasized that smaller companies involved in gold exploration often become investment vehicles for larger corporations in the sector. Norman provided an overview of US Gold Corp.’s primary project, the CK Gold project, and its location just outside Cheyenne, Wyoming.

“Navigating the permitting process in North America can be challenging, with federal agencies causing bottlenecks,” Norman said.

Norman did highlight the advantage of working with the state of Wyoming, which has set a mandate for a more streamlined permitting timeline.

Despite trading at a significant market discount due to perceived permitting challenges, US Gold Corp. has 1.5 million ounces of reserves in the ground, and its all-in-sustaining costs are projected at $800 per ounce.

Norman believed the in-situ value of reserves in the ground should place U.S. Gold Corp’s market cap to about $300 million, while the company is currently trading at about $40 million market cap. Norman highlighted how ESG became a hugely important factor in the business and he aspired to develop the greenest mine in North America.

Now Read: U.S. Gold Stock, Analyst Ratings, Price Targets, Predictions

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