The junior gold mining stocks we’ve uncovered are sub $5 billion market cap gold producers trading at a discount to Net Asset Value (NAV)
SmallCapPower | August 9, 2019: Price to Net Asset Value (P/NAV) is a key metric used to value a mining company. In general, companies trade closer to 1 when the market believes a company’s assets are fully valued. Companies that trade at a premium to NAV are typically late-stage developers or producers. Today we have discovered four junior gold mining stocks that are trading at a discounted P/NAV when compared to its peers. For reference, our list of 23 companies are trading at an average P/NAV of 1.1x.
*Share prices as at close August 6, 2019, data obtained from S&P Capital IQ
OceanaGold Corporation (TSX: OGC) – $3.76
Metals and Mining
OceanaGold Corporation is a mid-tier, multi-national gold producer that operates mines in the Philippines, New Zealand, and the U.S. Currently, the Company’s assets include: 1) the underground Didipio Gold-Coper Mine on the island of Luzon in the Philippines; 2) the high-grade underground Waihi Gold Mine on the North Island of New Zealand; 3) the open-pit Haile Gold Mine in South Carolina and; 4) the Macraes Goldfield on the South Island of New Zealand. The Macraes Goldfield property includes a series of open-pit mines and the Frasers underground mine. On July 25, 2019, OGC reported its Q2/19 financial results, generating revenue of $186M with EBITDA of $70.7M. Visit the Company’s corporate website for more information.
- Market Cap: $2,339.8 Million
- YTD Return: -22%
- P/NAV: 1.05x
- 30 Day Trading Volume (1,000): 2,350
Alamos Gold Inc. (TSX: AGI) – $9.69
Metals and Mining
Alamos Gold is an intermediate gold producer based in Canada that operates four mines in North America. These include: 1) the Young-Davidson mine in northern Ontario; 2) the Island Gold mine in northern Ontario; 3) the Mulatos mine in Sonora State, Mexico; and 4) El Chanate mine in Sonora State, Mexico. As well, the Company has a substantial portfolio of development stage projects in Canada, Mexico, Turkey and the U.S. The Company released its Q2/19 results on July 31, 2019, reporting all-in sustaining costs of $926 per ounce and realized net earnings of $23.6M. Visit the Company’s corporate website for more information.
- Market Cap: $3,778.5 Million
- YTD Return: 105%
- P/NAV: 0.91x
- 30 Day Trading Volume (1,000): 869
Eldorado Gold Corporation (TSX: ELD) – $11.35
Metals and Mining
Eldorado Gold is a gold and base metals producer that has mining, development and exploration operations in Turkey, Canada, Greece, Romania, Serbia, and Brazil. In Turkey, the Company operates two gold mines: 1) Kışladağ (open pit); and 2) Efemçukuru (underground operation). In Greece, it operates two polymetallic mines: 1) Olympias; and 2) Stratoni (underground). In Quebec, it operates the Lamaque underground gold mine. And in Brazil, the Company operates Vila Nova, an open-pit, iron ore mine. On August 1, 2019, ELD announced its Q2/19 financial results, reporting revenue of $173.7M. Eldorado’s all-in sustaining costs for the quarter were $917 per ounce of gold sold, which is 1.8% lower quarter-over-quarter. Visit the Company’s corporate website for more information.
- Market Cap: $1,798.0 Million
- YTD Return: 189%
- P/NAV: 0.80x
- 30 Day Trading Volume (1,000): 1,576
Detour Gold Corporation (TSX: DGC) – $23.22
Metals and Mining
Detour Gold Corporation is a Canadian mid-tier gold mining company that has 100% interest in the Detour Lake mine. The mine is a large scale, open-pit operation that is based in northeastern Ontario. The Company acquired the property in January 2007, and it expects it to have a mine life of 22 years with an average gold production of 659,000 ounces per year. On July 30, 2019, the Company released Q2/19 financial results, reporting all in sustaining costs of $1,143 per ounce sold. During the quarter, the Company generated revenue of $202M from the sale of 153,748 ounces of gold at an average price of $1,309 per ounce. Visit the Company’s corporate website for more information.
- Market Cap: $4,094.9 Million
- YTD Return: 115%
- P/NAV: 1.05x
- 30 Day Trading Volume (1,000): 1,199
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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