7 Gold Stocks That Are Losing Safe-Haven Appeal

Gold hit its lowest level since Brexit as investors throw a 'taper tantrum'

Should You Buy DUST Stock?

Source: Jeremy Vohwinkle via Flickr (Modified)

Precious metals are under fire Tuesday, with silver suffering its worst one-day loss in 20-months as the U.S. dollar surges above its 200-day moving average for the first time since July — reducing the safe-haven appeal of gold and silver.

Other safe havens, including utility stocks and Treasury bonds, are also under pressure, likely resulting in some portfolio-related selling (since these assets are commonly held together).

Gold mining stocks are getting crushed in sympathy with the Market Vectors Junior Gold Miners ETF (NYSEARCA:GDXJ), dropping nearly 10% to fall to levels not seen since June, falling out of a three-month consolidation range. The larger gold stocks in the Market Vectors Gold Miners (NYSEARCA:GDX) are even worse off, returning to levels first reached in April.

For those looking to survey the carnage underway, here are seven gold and silver stocks to avoid.

Gold Stocks Melting Down: Barrick Gold (ABX)

abx

Barrick Gold Corporation (USA) (NYSE:ABX) — based in Toronto with operations in North America, Australia, South America and elsewhere — is suffering as its shares drop below their 200-day moving average for the first time since January.

This ends a three-month consolidation range between $19 and $17, which ended an eight-month uptrend that saw shares gain nearly 200%.

The company will next report results on Oct. 26 after the bell. Analysts are looking for earnings of 22 cents per share on revenues of $2.19 billion.

Gold Stocks Melting Down: Goldcorp (GG)

gg

Goldcorp Inc. (USA) (NYSE:GG) based in Vancouver with operations throughout the Americas, dropped out of a three-month consolidation range on Tuesday to return to levels last seen in early March.

This represents a 25%-plus decline from the highs set in July. If support near $14 doesn’t hold, watch for retest of support near $10 from January.

The company will next report results on Oct. 26 after the bell. Analysts are looking for earnings of 13 cents per share on revenues of $1.04 billion.

Gold Stocks Melting Down: Randgold Resources (GOLD)

gold

Randgold Resources Ltd. (ADR) (NASDAQ:GOLD), based in the Channel Islands with operations in Sub-Saharan Africa, is watching its shares drop below their 200-day moving average for the first time since January returning to levels last seen in June.

The company enjoyed a surge higher earlier this year, in which the stock price more than doubled to end a long sideways channel that went back to 2013. Now, it looks like shares are about to reverse the bulk of those gains.

The company will next report results on Nov. 3 before the bell.

Gold Stocks Melting Down: AngloGold Ashanti (AU)

au

AngloGold Ashanti Limited (ADR) (NYSE:AU) is based in South Africa with operations in the Americas, Australasia and its home continent. AU shares have dropped below their 200-day moving average on Tuesday to return to levels last seen in early June.

When the company last reported results in August, they were solid: Free cash flow trebled to $108 million for the first half of the year as net debt was cut by 32% amid a focus to concentrate on its highest quality mines, selling or shuttering less profitable assets.

This helped push stocks up nearly 300% from its summer 2015 lows. But now, profit-taking is taking hold.

Gold Stocks Melting Down: Kinross Gold (KGC)

kgc

Kinross Gold Corporation (USA) (NYSE:KGC), based in Toronto with operations around the world in locales including Russia, Brazil, Ghana and elsewhere, is watching as shares drop below their 200-day moving average for the first time since February.

This ends a six-month run above the $4 per share level. The downtrend also ends the first sustained rise in the stock since 2009, which is an incredible run of poor performance.

The company will next report results on Nov. 2 after the close. Analysts are looking for earnings of five cents per share on revenues of $920 million.

Gold Stocks Melting Down: Yamana Gold (AUY)

auy

Yamana Gold Inc. (USA) (NYSE:AUY), based in Toronto with operations throughout the Americas, is also watching as its shares drop below their 200-day moving average to return to levels not seen since April.

When the company reported second-quarter results back in July, earnings totaled $33 million, or three cents per share, on revenues of $467 million, up $40 million from last year.

The company will next report results on Oct. 27 after the close. Analysts are looking for earnings of five cents per share on revenues of $507.6 million.

Gold Stocks Melting Down: NovaGold (NG)

ng
NovaGold Resources Inc. (USA) (NYSEMKT:NG) shares are among the worst presented here, falling back below its 200-day moving average on Tuesday after struggling to stay above that level since August.

Not even an upgrade to “overweight” from “neutral” by analysts at JPMorgan on Sept. 27 could break the funk. A violation of critical support near $5 — which held the stock in May/June and again in early September — would set up a return to February/March trading levels.

The company will report Q3 results on Oct. 5. The company is a development stage play, working on the Donlin Gold mine in Alaska (shared 50% with Barrick) and the Galore Creek copper mine in northern British Columbia (shared 50% with Teck Resources).

Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. A two-week and four-week free trial offer has been extended to InvestorPlace readers.


Article printed from InvestorPlace Media, https://investorplace.com/2016/10/gold-stocks-silver-gg-abx/.

©2019 InvestorPlace Media, LLC