The Smartest Investors Club
  • Business
  • Politics
  • Investing
  • World
  • Business
  • Politics
  • Investing
  • World

The Smartest Investors Club

Investing

Adrian Day: Gold Stocks More Undervalued Than Ever, Takeoff Will be Dramatic

by January 30, 2024
January 30, 2024
Adrian Day: Gold Stocks More Undervalued Than Ever, Takeoff Will be Dramatic

He noted that there’s been a misalignment for the last 11 years, but particularly in the last two years, when central banks and wealthy families in the Middle East and Asia started loading up on the yellow metal for insurance purposes.

‘Their motives are long term and defensive, so they buy bullion, they don’t buy gold stocks. So in a way — and people don’t like it when I say this — but in a way, up until let’s say the last couple of months, I would argue that it was gold that was out of kilter with economic reality, not the gold stocks. The gold stocks were where they should have been; gold should have been lower, but it was this central bank buying that pushed it up,’ Day explained.

In his view, when the US Federal Reserve starts cutting interest rates and monetary factors start driving gold, the metal will eventually make it to US$2,100 per ounce and stay there. At that point, investors will get interested in gold stocks.

‘Particularly if the broad market starts to wobble. It doesn’t have to crash — a crash would not be good for gold stocks — but wobble. And people start to get out of NVIDIA (NASDAQ:NVDA) and look for other (options) — maybe out of NVIDIA and into ExxonMobil (NYSE:XOM) or something. There’s a bit of rotation. That’s good for gold. If we see that, I think the scenario is a perfect setup for gold,’ he during the conversation.

Day added that although he’s said before that gold stocks are incredibly undervalued, the situation has only intensified. As an example, he noted that major producer Agnico Eagle Mines (TSX:AEM,NYSE:AEM) is selling at its lowest price-to-cashflow multiple ever aside from the last quarter of 2015, when the gold price fell as low as US$1,061.

‘We’ve been through this so many times in the past — gold stocks can languish for a long time. And then when they take off, first of all they take off suddenly, and secondly the returns are dramatic,’ he said.

Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com
0
FacebookTwitterGoogle +Pinterest
previous post
Biden’s push to regulate new tech is ‘misguided,’ expert warns
next post
How to Invest in OpenAI’s ChatGPT (Updated 2024)

You may also like

Horne 5 Project Update

JZR Gold Enters into Loan Agreement

Alpha Lithium Files Notice of Change to Directors’...

FREEGOLD ANNOUNCES CLOSING OF $42 MILLION BROKERED PRIVATE...

John Feneck: Gold Backdrop Looks “Amazing,” Plus 7...

WESTERN COPPER AND GOLD ANNOUNCES VOTING RESULTS FROM...

High-Grade Mineralisation Identified at North Sweden Project

10 Largest Producers of Gold by Country

Abra Cash Flow Positive

NorthStar Gaming to Host Q3 Earnings Webinar on...

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest

    • ‘A fear campaign.’ Students around the world are shocked, scared and saddened...

    • North Korea deploys mystery balloon-like objects to stricken warship, satellite photos show

    • NVIDIA Rallies After Strong Q1, AI Demand Outshines China Export Hit

    • US senators meet with Zelensky in Kyiv as doubt cast over upcoming Ukraine-Russia peace talks

    • Israel’s plan to ‘conquer’ Gaza is leaving Palestinians with little place to go: 5 maps show how

    Categories

    • Business (1,673)
    • Investing (4,999)
    • Politics (7,837)
    • World (6,349)
    • Terms & Conditions
    • Privacy Policy
    • About us

    Disclaimer: thesmartestinvestorsclub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 thesmartestinvestorsclub.com | All Rights Reserved


    Back To Top