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444% Increases - Billionaires on Gold Mines

September 14, 2013 | About:
Sally Jones

Sally Jones

49 followers
Here’s a look at three gold mining companies on a 52-week low. The companies selected are more than 65% off a 52-week high.

Billionaires can afford to hold these mining companies for five years of losses without a sting to the wallet and the sheer number of billionaires holding these gold companies is a compelling-enough statement. But in second quarter trading, two Guru investors upped their stakes in two of today’s featured companies more than 444%, making us wonder: Is it hope, is it seasoned neutrality, or is there reason to believe these companies could be on the verge of a big pay day?

Industry Sector: Metals and Mining

The metals & mining sector currently has 30 companies out of 174 on a 52-week low. The low ratio is 0.17.

Anglogold Ashanti Limited (AU)

Down 65% over 12 months, Anglogold Ashanti Limited has a market cap of $4.85 billion, and trades with a P/E of 8.10.

The current share price is around $12.70, or 65.6% off the 52-week high of $36.93. The yield is 2.10%.

Anglogold Ashanti Limited is a gold exploration, mining and marketing company with a portfolio of operations and projects on four continents. The company is headquartered in Johannesburg, South Africa, and has 21 operations in 10 countries. Major development projects include: Tropicana located in Australia; Kibali in the Democratic Republic of the Congo (DRC) and La Colosa in Colombia. The company's exploration programs extend to 12 countries, in both established and new gold-producing regions.

The company reported financial results for the three months ended June 30, 2013 with production of 935,000 oz., as a 4% increase over production in the first quarter of 2013. The company’s adjusted gross profit for the quarter was $231 million compared to $$658 million year-over-year.

Guru Action: As of June 30, 2013, there are eleven guru stakeholders and insider buying.

The top Guru stakeholder is John Paulson who reduced his position by 1.13%, selling 319,450 shares at an average price of $18.03 per share, for a loss of 29.6%. He currently holds 27,935,500 shares or 7.25% of shares outstanding. The holding is 2.8% of his total assets managed.

The biggest AU news of second quarter is that Jean-Marie Eveillard’s First Eagle Investment Management increased its position by 444.51%, buying 21,981,524 shares at an average price of $18.03 per share for a loss of 29.6%.

Track share pricing, revenue and net income:

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Richmont Mines Inc. (RIC)

Down 70% over 12 months, Richmont Mines Inc. has a market cap of $56.23 billion, and trades with a P/B of 0.60.

The current share price is around $1.42, or 74.2% off the 52-week high of $5.50. The yield is 0.00%.

First incorporated in Quebec in 1981 under the name Resources Minieres Rouyn Inc., Richmont Mines Inc. is engaged in the acquisition, exploration, operation, financing, and development of mineral properties. The company began its exploration activities in northwestern Quebec in the spring of 1984.

The company reported financial results (reported in Canadian currency, unless otherwise noted) for the three months ended June 30, 2013 with: Revenues for the second quarter of 2013 at $17.8 million, down 25% from revenues of $23.7 million in the second quarter of 2012, reflecting a 12% decrease in the number of gold ounces sold, and a 14% decrease in the average gold price obtained in Canadian dollars. A total of 12,826 ounces of gold were sold at an average price of $1,389 ($1,367 USD) per ounce in the current quarter, versus gold sales of 14,611 ounces and an average realized sales price of $1,617 ($1,618USD) per ounce in the comparable period last year. The reported a net loss of $1.1 million, or $0.03 per share, in the second quarter of 2013, versus a net loss from continuing operations of $2.9 million, or $0.09 per share in the second quarter of 2012, according to a company press release.

Guru Action: As of June 30, 2013, there are three guru stakeholders and active insider trading.

The top Guru stakeholder is Jim Simons who increased his position by 6.81%, buying 136,100 shares at an average price of $1.93 per share, making a loss of 26.4%. He currently holds 2,135,100 shares or 5.39% of shares outstanding.

In five years of holding there is not one gaining quarter. Simons has averaged a loss of 77% on 2,769,700 shares bought at an average price of $6.17 per share. He also averaged a loss of 63% on 634,600 shares sold at an average price of $3.79 per share.

Charles Brandes made a new buy as of June 30, 2013. He bought 13,696 shares at an average price of $1.93 for a loss of 26.4%.

Track share pricing, revenue and net income:

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Buenaventura Mining Company Inc. (BVN)

Down 70% over 12 months, Buenaventura Mining Company Inc. has a market cap of $2.95 billion, and trades with a P/E of 6.70.

The current share price is around $11.65, or 70.9% off the 52-week high of $40.09. The yield is 4.13%.

Located in Peru, Buenaventura Mining Company Inc. is a publicly-traded precious metals company, mainly producing refined gold and silver, either as dore bars or concentrates. The company is engaged in the exploration, mining and processing of gold, silver and, to a lesser extent, other metals such as lead, zinc and copper as concentrates.

The company reported financial results (in U.S. currency) for the three months ended June 30, 2013 with a net income of $19 million, 88% lower than $153.2 million for the same quarter in the previous year. EBITDA was reported as $40.3 million, 65% lower than $114.6 million in the same quarter a year ago, according to a company press release.

Guru Action: As of June 30, 2013, there are four guru stakeholders and no insiders trading.

The top Guru stakeholder Jeremy Grantham increased his position by 40.36%, buying 1,689,982 shares at an average price of $19.50 per share, for a loss of 40.3%. He currently holds 5,877,252 shares or 2.31% of shares outstanding. In five years of holding, his trading history shows every quarter with a double-digit loss.

Guru Jim Simons increased his position by 444.21% in the second quarter, buying 1,323,300 shares at an average price of $19.5 for a 40.3% loss.

Over five years, he has averaged a loss of 60% on 3,320,900 shares bought at an average price of $29.09 per share. He has averaged a loss of 55% on 5,687,500 shares sold at an average price of $26.05 per share.

Track share pricing, revenue and net income:

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About the author:

Sally Jones
Sally Jones writes about Real Time Picks. She says, "I truly enjoy watching the Gurus in realtime and telling their story."

Rating: 4.0/5 (4 votes)

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