This article was originally published on Gold Investing News on August 19, 2014.
Last week, Gold Investing News took a look at the top five holdings of the Market Vectors Gold Miners ETF (ARCA:GDX), which “seeks to replicate as closely as possible, before fees and expenses, the price and yield performance” of the NYSE Gold Miners Index (INDEXNYSEGIS:GDM).
The occasion? The index is up 26 percent this year, performing markedly better than gold, which has risen just 8.9 percent in that time. According to The Wall Street Journal, that’s because gold miners are now back in favor after spending “years in the shadow of gold.”
However, while the Gold Miners ETF is a good option for investors looking to get exposure to large gold companies, not everyone is interested in the big companies it includes. Luckily, Van Eck Associates, which administers the ETF, thought of that possibility and also offers the Market Vectors Junior Gold Miners ETF (ARCA:GDXJ).
Here’s a look at that ETF’s top five holdings as of today.
1. Torex Gold Resources (TSX:TXG)
Canada-based Torex, which bills itself as a “well-funded, growth-oriented” company, is exploring and developing its Morelos gold property, which covers 29,000 hectares in Mexico’s Guerrero Gold Belt. Located at the property are its El Limon-Guajes project and Media Luna project; the former has been under construction since November 2013, while the latter is at an advanced stage of exploration.
Torex released its Q2 financial results just last week, commenting that work at El Limon-Guajes remains on schedule and on budget. Meanwhile, the company continues to evaluate Media Luna.
2. SEMAFO (TSX:SMF)
SEMAFO, also based in Canada, operates the Mana mine in Burkina Faso, which includes the high-grade satellite Siou and Fofina deposits. This year, it hopes to produce between 200,000 and 225,000 ounces of gold — that would be a 34-percent increase over 2013 production. It also plans to lower its cash cost by 9 percent, to between $695 and $745 per ounce.
Like Torex, SEMAFO recently put out its financial and operating results for 2014′s second quarter. Happily for the company, it looks like its 2014 goals will likely become a reality. Its press releases states, “we expect to attain the upper end of our 2014 production guidance of between … and the lower end of our 2014 total cash cost guidance.”
3. Northern Star Resources (ASX:NST)
Australian gold producer Northern Star Resources owns and operates a number of gold mines, but also has “a strong exploration focus.” Indeed, it has a land package that covers about 10,000 square kilometers in prospective areas of Western Australia.
Though it hasn’t yet released its Q2 results, Northern Star had some good news at the end of July, when it announced that it has increased the total JORC resource estimate for its Jundee gold mine by 68 percent, to 851,000 ounces. The increase paves the way for “significant mine life extension,” according to the company.
4. OceanaGold (TSX:OGC,ASX:OGC)
OceanaGold operates four gold mines across New Zealand’s South Island and the Philippines. Its goal is to “be a mid-tier, multi-national gold producer delivering superior shareholder returns in a safe and sustainable manner.”
Mick Wilkes, managing director of OceanaGold, said in the company’s Q2 financial and operating results release, “[w]e had a strong start to the first half of the year with free cash flow generation of $71 million including $22 million in the second quarter despite a lower quarter for production.” The company’s H1 production came to 147,399 ounces of gold and 11,185 tonnes of copper.
5. Primero Mining (TSX:P,NYSE:PPP)
Gold and silver producer Primero has operations in Mexico and Canada and plans to become “a leading intermediate gold producer in the Americas.” Its operations include the San Dimas gold-silver mine and Cerro del Gallo gold-silver-copper development project, both located in Mexico, as well as the Canada-based Black Fox property and adjoining properties.
This past quarter, Primero achieved record production of 63,414 gold equivalent ounces, up substantially from the 39,089 it put out in the year-ago quarter. It also reported adjusted net income of $1.1 million, or $0.01 per share. CEO Joseph F. Conway credited San Dimas with that success, saying in a press release, “[t]he second quarter highlighted the value and success of the first phase of the expansion of the San Dimasmine.”
Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
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