Nick Hodge – Macro Megatrends That Matter For Gold, Uranium, and Oil Stocks
Nick Hodge, Co-Owner of Digest Publishing and editor of Foundational Profits and Hodge Family Office, joins us to review the macroeconomic data and trends that matters for gold, uranium, and oil stocks.
We start off looking at the underwhelming jobs report data that hit last Friday, and the trend all year of revisions downwards to previous months metrics. Nick points out that we’ve not seen a trend like this since 2007, and that pairs with the 1 year long weakening statistics out of the manufacturing sector that also harken back to 2007 for a similar stretch of negative data. Then we got into the pain the real estate market, both residential and commercial, is facing in some of the recent data and trends, and how that may spill over into negatively impacting the financial sector and regional banks. He goes on to list a number of other factors that keep stacking up pointing to the likelihood of an economic contraction and recession next year.
With regards to gold, we got into the gold stocks more in this discussion, where he highlighted Revival Gold (RVG.V) as an example of being able to pick up quality companies, with defined ounces in the ground, and exploration upside on deep discount. Additionally, we reviewed why Nick also continues to hold gold and silver producers in his portfolio to capture the moves in the underlying metals prices more in real time, benefit from ETF inclusion from generalist buying, by picking up dividends in many of the senior producers, and reduce down capitalization and sustaining risks. He pointed out that with producers there can also be operational upside, and pointed to the recent solid quarterly report from Fortuna Mining (FSM) (FVI.TO) and their bifurcation to the upside compared to the rest of the sector as this news was reported.
We wrap up pivoting over to the energy sector and two commodities that have had some momentum for the last 2 years in their related resources stocks – oil and uranium. He points out that uranium has bifurcated to the upside, in contrast to oil’s corrective action lately within the energy sector. We go on to discuss that uranium’s own unique fundamental supply/demand drivers, has seen an even larger response in the uranium mining stocks, and that it is one of the few commodities that has actually attracted generalist and hedge fund interest this year.
.
Yes, Fortuna just bought Chesser Resources Limited which was an Aussie explorer/developer in Africa.
This will augment their purchase of Roxgold, and their continued increase in gold production and projects, which begs the question if they should change their name to Fortuna Gold & Silver, since a large portion of their production is now from gold versus silver.
Regardless, I still own it and it has fared much better than many other companies in my portfolio, and I expect to see good revenues keep coming in during the quarters to come. The market was asleep on just how good those Roxgold assets were that they picked up last year, and the growth in those 2 projects, and it represents further upside if gold prices stay at elevated levels like they have been.
Hedge Funds Pile Into Uranium Stocks Poised For ‘Dramatic’ Gains
30th October 2023 – Bloomberg
My small holding of Fortuna(FSM) LEAP calls are finally in the money with the success of their West Africa gold operation. I may buy more of those calls a little farther out on the time line. FSM have recently bought an ASX gold company, with exploration upside in Africa…