Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
VR and Gaming Becomes the Metaverse - 7th Dec 21
How to Read Your Smart Meter - Economy 7, Day and Night Rate Readings SMETS2 EDF - 7th Dec 21
For Profit or for Loss: 4 Tips for Selling ASX Shares - 7th Dec 21
INTEL Bargain Teck Stocks Trading at 15.5% Discount Sale - 7th Dec 21
US Bonds Yield Curve is not currently an inflationist’s friend - 7th Dec 21
Omicron COVID Variant-Possible Strong Stock Market INDU & TRAN Rally - 7th Dec 21
The New Tech That Could Take Tesla To $2 Trillion - 7th Dec 21
S&P 500 – Is a 5% Correction Enough? - 6th Dec 21
Global Stock Markets It’s Do-Or-Die Time - 6th Dec 21
Hawks Triumph, Doves Lose, Gold Bulls Cry! - 6th Dec 21
How Stock Investors Can Cash in on President Biden’s new Climate Plan - 6th Dec 21
The Lithium Tech That Could Send The EV Boom Into Overdrive - 6th Dec 21
How Stagflation Effects Stocks - 5th Dec 21
Bitcoin FLASH CRASH! Cryptos Blood Bath as Exchanges Run Stops, An Early Christmas Present for Some? - 5th Dec 21
TESCO Pre Omicron Panic Christmas Decorations Festive Shop 2021 - 5th Dec 21
Dow Stock Market Trend Forecast Into Mid 2022 - 4th Dec 21
INVESTING LESSON - Give your Portfolio Some Breathing Space - 4th Dec 21
Don’t Get Yourself Into a Bull Trap With Gold - 4th Dec 21
4 Tips To Help You Take Better Care Of Your Personal Finances- 4th Dec 21
What Is A Golden Cross Pattern In Trading? - 4th Dec 21
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - Part 2 - 3rd Dec 21
Stock Market Major Turning Point Taking Place - 3rd Dec 21
The Masters of the Universe and Gold - 3rd Dec 21
This simple Stock Market mindset shift could help you make millions - 3rd Dec 21
Will the Glasgow Summit (COP26) Affect Energy Prices? - 3rd Dec 21
Peloton 35% CRASH a Lesson of What Happens When One Over Pays for a Loss Making Growth Stock - 1st Dec 21
Stock Market Sentiment Speaks: I Fear For Retirees For The Next 20 Years - 1st Dec 21 t
Will the Anointed Finanical Experts Get It Wrong Again? - 1st Dec 21
Main Differences Between the UK and Canadian Gaming Markets - 1st Dec 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Goldcorp (NYSE: GG): A Safe Play for $2,000 Gold

Commodities / Gold & Silver Stocks Feb 15, 2012 - 06:51 AM GMT

By: Yiannis_G_Mostrous

The case for investing in gold remains strong: The EU sovereign-debt crisis continues to drag on, while the US economic recovery remains anemic relative to most postwar economic cycles. Meanwhile, central banks purchased about 400 tons of gold last year and will likely add to their stockpiles in 2012.

In late August 2012, gold reached its most recent high of $1,889.70 per ounce. A sharp decline from this peak prompted some investors to question the sustainability of the bull market. But the consensus tends to forget that the rush to gold, which began in 2001, has endured its share of ups and downs along the way. 

Given the structural challenges facing the major developed economies, investors should regard weakness in gold and other rare metals stocks as a buying opportunity. I expect the supply-demand balance for gold to tighten in 2012 and have tipped the yellow metal to top $2,000 per ounce this year.

Goldcorp (NYSE: GG), which operates primarily in the Americas, remains my favorite large-cap gold producer. Management’s forecast calls for the company to grow its gold output to 2.6 million ounces and its silver output to 34 million ounces in 2012. Goldcorp also produces significant amounts of copper, lead and zinc. The firm boasts some of the lowest production costs among its peers. 

The company expects gold production to grow to 4.2 million ounces—a 70 percent increase—over the next five years. Goldcorp recently made a final investment decision on the El Morro gold and copper project in northern Chile, a $3.9 billion endeavor that should produce its first gold in late 2017. Management estimates that the mine’s production will average 210,000 ounces of gold and 200 million pounds of copper annually during its 17-year life span.

The stock trades at a premium to its peers, which is justified by the company’s high-quality assets and potential output growth. Rising production costs should be more than offset by higher gold prices.

For more tips and analysis, check out my free report on the top gold stocks to own now.

By Yiannis G. Mostrous
Editor: Silk Road Investor, Growth Engines

Yiannis G. Mostrous is an associate editor of Personal Finance . He's editor of The Silk Road Investor , a financial advisory devoted to explaining the most profitable facets of emerging global economies, and Growth Engines , a free e-zine that provides regular updates on global markets. He's also an author of The Silk Road To Riches: How You Can Profit By Investing In Asia's Newfound Prosperity .

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in