Q: Hi team,
What are your thoughts on GMIN ? Seems to have good momentum recently with the gold price going up. How risky is it for a 5-10yrs holding period?
Thanks
Benoit
What are your thoughts on GMIN ? Seems to have good momentum recently with the gold price going up. How risky is it for a 5-10yrs holding period?
Thanks
Benoit
5i Research Answer:
GMIN has been showing great momentum over the past couple of years, alongside the broader increase in the price of gold. It is a $4.0B gold producer with strong sales and earnings growth estimates, and a positive cash flow profile. It has a $1.1B equity position, with a net cash position, and it trades at a decent valuation of 11X forward earnings. For a long-term hold (5-10 years), we would prefer a larger and more stable name like WPM or AEM, but we think if the price of gold continues to stabilize or increase in the coming years that GMIN can expand its fundamentals and perform well. We would be OK with a long-term position here, while acknowledging is smaller size and certain risks.