The small cap gold stocks on our list would appeal to the precious metals bargain hunters
SmallCapPower | May 12, 2017: The U.S. stock rally and strengthening of the U.S. dollar following the election of Donald Trump resulted in a drop in gold prices at the tail end of 2016. Gold has since rebounded and is up 10% YTD, due to geopolitical uncertainty in key countries throughout the world. Furthermore, the S&P 500 is trading at a historically high PE ratio, which many investors see as a big concern. If you share this outlook, it may be a good time to get into gold as the price of gold typically rises during a market crash. Today we have identified five profitable small cap gold stocks with big upside potential, as they are trading at a significant discount to Net Asset Value (NAV).
Alamos Gold Inc. (TSX: AGI) – $8.71
Alamos Gold Inc. is a Canada-based company, which is engaged in the acquisition, exploration, development and extraction of precious metals. The Company owns and operates the Young-Davidson mine in Canada and the Mulatos and El Chanate mines in Mexico. In addition, the Company owns the AgiDagi, Kirazli and Camyurt gold development projects in Turkey, the Lynn Lake gold project in Canada and the Esperanza gold project in Mexico.
- Market Cap: $1,908,361,612
- Total Revenue (LTM): $665,521,000
- Debt to Equity: 17.3%
- YTD Price Change: -5.8%
- Price/NAV: 0.70
- Gross Profit Margin: 35.7%
Centerra Gold Inc. (TSX: CG) – $7.69
Centerra Gold Inc. is a Canada-based gold mining company focused on operating, developing, exploring and acquiring gold properties in Asia, North America and other markets across the world. Its Kyrgyz segment includes Kumtor Gold Co. (KGC) (Kyrgyz Republic), which operates Kumtor Mine. Its Mongolian segment includes Centerra Gold Mongolia LLC (CGM) (Mongolia), which operates ATO Project and Gatsuurt Project, and Boroo Gold LLC (BGC) (Mongolia), which operates Boroo Mine. Its Turkish segment includes Centerra Luxembourg Holdings S.ar.L (Luxembourg), Centerra Exploration B.V. (CEBV) (The Netherlands), and Oksut Madencilik Sanayi Ve Tkaret A.S. (Turkey), which operates Oksut Project. Its Canadian segment includes Hearts Peak Project and Greenstone Gold Mines (Canada).
- Market Cap: $1,640,614,649
- Total Revenue (LTM): $1,298,116,827
- Debt to Equity: 27.1%
- YTD Price Change: 22.3%
- Price/NAV: 0.69
- Gross Profit Margin: 45.5%
Hudbay Minerals Inc. (TSX: HBM) – $7.70
Gold, Base Metals
Hudbay Minerals Inc is a Canada-based mining company engaged in the production of copper concentrate, consisting of copper, gold and silver, as well as zinc metal. Through its subsidiaries, the Company owns approximately four polymetallic mines, four ore concentrators and a zinc production facility in northern Manitoba and Saskatchewan (Canada) and Cusco (Peru), as well as a copper project in Arizona (the United States). The Company owns the Constancia mine, an open-pit copper mine in Peru. It owns 777 mine, an underground copper, zinc, gold and silver mine in Flin Flon, Manitoba. It owns Lalor mine, an underground zinc, copper and gold mine near Snow Lake, Manitoba. It also owns Rosemont project, a copper development project in Pima County, Arizona, in the United States.
- Market Cap: $1,338,158,754
- Total Revenue (LTM): $1,506,908,992
- Debt to Equity (LTM): 73.0%
- YTD Price Change: 0.4%
- Price/NAV: 0.41
- Gross Profit Margin: 46.2%
Asanko Gold Inc. (TSX: AKG) – $3.25
Asanko Gold Inc. is a gold producer with operations in the Republic of Ghana. The Company’s principal asset is the Asanko Gold Mine (AGM) located in Ghana, West Africa. The Company’s Project 5M will upgrade the plant’s throughput to five metric tons per annum and expand mining operations to integrate the Esaase deposit, including the construction of a 27-kilometer overland conveyor. The Company is involved in open pit mining and conventional processing of gold ores mined in its Asanko Gold Mine in Ghana.
- Market Cap: $484,298,220
- Total Revenue (LTM): 175,910,000
- Debt to Equity (LTM): 37.2%
- YTD Price Change: -21.1%
- Price/NAV: 0.80
- Gross Profit Margin: 52.1%
New Gold Inc. (TSX: NGD) – $3.83
New Gold Inc. is an intermediate gold mining company engaged in the development and operation of mineral properties. Its segments include New Afton, Mesquite, Peak Mines, Cerro San Pedro, Corporate and Other. It has operating mines in Canada, the United States, Australia and Mexico; development projects in Canada, and a stream on gold production from a development property in Chile. Its development projects include Rainy River and Blackwater projects, which are located in Canada.
- Market Cap: $1,606,739,668
- Total Revenue (LTM): $930,393,220
- Debt to Equity (LTM): 42.9%
- YTD Price Change: -18.7%
- Price/NAV: 0.52
- Gross Profit Margin: 46.5%
Disclosure: Neither the author nor any of the principals at Small Cap Power, or their family members, own shares in any of the companies mentioned above.
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