Gold – Spiking on reality check - InvestingChannel

Gold – Spiking on reality check

Look at Newmont Mining (NEM, quote) and other larger cap miners who either have the cash to benefit from the rout in smaller gold companies because the reality is there will be a major gold supply squeeze somewhere in late 2014 and 2015 as all the supply taken off line leaves many short physical. 

Here’s a little insight into why Newmont looks very interesting even after a big pop today:

They are cutting and leading the charge to maximize returns, it trades at 1x book vs. 2.5x pre Fed QE period, and it pays a 4.5% div yield with over 10% of the market cap in cash. 

Major volume day on this move and bodes well for having exhausted short sellers.

 

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