After a terrible pre-Christmas week in which gold lost 0.58%, or $6.6 per troy ounce, on the London Bullion Market, the precious metal for immediate delivery is showing some signs of recovery this week.
Last week, gold fell from $1,137.60 per troy ounce on Dec. 19 to $1,131.00 per troy ounce on Dec. 23.
Today, gold closed at $1,139.75 per troy ounce, a 0.77% increase ($8.75) from the last close.
The precious metal is also recovering on the Comex. The financial contracts through which the precious metal is traded are currently at $1,139.35 per ounce, up 55 cents or 0.05% from the previous close.
This is the fourth jump in a week and the eleventh jump out of a total of 24 over the last month. The average price per ounce was $1,153.85 and ranged between a high of $1,194.80 per ounce and a low of $1,123.90.
The gold stock industry is also uptrending over the last five trading days, with the bigger increases reported by Eldorado Gold Corp. (EGO, Financial) with 11%. Eldorado outperformed the SPDR Gold Trust (GLD, Financial) and the VanEck Vectors Gold Miners ETF (GDX, Financial), which were at 7% and 11%.
Eldorado Gold Corp. is followed by the South African miners Harmony Gold (HMY, Financial) with 8%, AngloGold Ashanti (AU, Financial) with 6% and Gold Fields Ltd. (GFI, Financial) with 6%. Kinross Gold Corp. (KGC, Financial) is the tail-end with a 1% increase.
Despite the resent upside in the share price of gold stocks, many of them are still trading only a few times over their book value and Ebitda, increasing the possibility of finding opportunities in the gold industry.
Opportunities can especially be found in the subsector of gold and silver royalty and streaming companies that are now seen by investors as good opportunities because of their high-quality assets.
One of these gold and silver royalty and streaming companies gaining consensus among investors is Terraco Gold Corp. (TSXV:TEN, Financial) (TCEGF, Financial), a precious metal royalty company headquartered in Vancouver.
This gold royalty company will derive its revenue from a net smelter return (NSR) of up to 3% on the prolific Spring Valley gold project in Nevada once it starts producing. The portfolio of Terraco also comprises a NSR of up to 2% on the Moonlight Project, which is contiguous to the north side of the Spring Valley Project.
The two gold projects are held by Waterton Global Resource Management, a private Canadian company specializing in the metals and mining sector.
Terraco Gold is also working on the Nutmeg Mountain and Almaden gold project in Idaho. The project is at an advanced stage with 864 thousand ounces of measured and indicated gold resources and 84 thousand ounces of inferred resources, according to the Mine Development Associates'Â technical report.
Terraco Gold is trading at nine cents on other over-the-counter markets, up 0.009 cents or 11.88% from the prior close. On the TSX Venture Exchange, it closed at 12 cents (Canadian), up 0.005 cents or 4.17% from the previous close.
The company had $1.8 million in cash on hand as of the most recent quarter. The total debt amounted to $6.66 million.
Terraco Gold Corp. is currently neglected by the stock market due to the fact its most promising project is not producing yet. However, it may be a good buying opportunity considering the Spring Valley gold project’s potential.
Disclosure: I have no positions in any stock mentioned in this article.
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