I’m telling you right now Gold stocks are the cheapest they’ve been in decades.
They have been in a stealth bear market while Gold has spiked by almost 30% to $2,900/oz
I’m a CFA. I follow the money.
The average Major Gold Miner is printing cash – but their valuations based on FCF profits have been falling.
This is what I’m calling The Golden Anomaly – and your big opportunity.
For example:
Newmont Mining just reported blow-out numbers earlier this month.
Newmont is trading at a 48% discount to fair value based on FCF.
It’s the cheapest it’s been in over a decade.
The stock is trading with a 20% FCF yield.
That means you have the opportunity to buy $1 of FCF profits for $0.20 cents.
This is the same metric I used to identify Newmarket Gold and SilverCrest Metals – both of which became multiple 1,000%+ winners for my readers.
The Golden Anomaly is what the world’s best investors look for.
I know because I’m a CFA, a graduate of the program started by Warren Buffett’s mentor, Benjamin Graham.
Buffet now holds $334 bil cash, 36% of his portfolio, because he can’t find any value in the average stock.
His Buffett indicator, that compares equity value (measured by the market cap of the Wilshire 5000 to US GDP), shows stocks are overvalued by 2.2 standard deviations.
A truly rare occurrence only seen in 1970 and 2000.
Money has been chasing growth at the expense of value for years.
But now the trend is reversing.
Value stocks, especially the Gold Miner’s, have been long overlooked and trade at a significant discount to fair value based on FCF profits.
So, don’t be surprised if Mr. Buffet discloses a new stake in Newmont Mining in his next 13F filing – because I follow the same metrics he does.
One other thing to note in the Buffett Indicator are the dates of the extreme overvaluations in 1970 and 2000. Both marked the bottom for the Gold price.
Gold rose 20X from $41/oz in 1970 to over $800/oz in 1980. In 2000 Gold rose 8X from $250/oz to $2,000/oz.
The Buffett Indicator identifies the turning point of the growth vs value battle. Value is back in play. It’s a trend that will take a decade to play out.
Gold Miner’s have the perfect tailwinds of extreme low valuation and a supportive Gold price environment.
Get your portfolio ready for the structural asset shift back to value.
If Buffett’s new Newmont position sends Gold stocks soaring…
The smaller Gold Miners will go even higher.
Which means you could take a small stake of $1,000 and potentially turn it into a profit of $100K or more. It’s happened before and it’s going to happen again.
That’s why I want to tell you about the four opportunities I’ve identified even better than the Newmont example above.