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John Rubino – Will The Higher Gold And Silver Prices Lead To Upside Surprises With Q2 Earnings Reports?

John Rubino, [Follow John on his Substack https://rubino.substack.com/],  joins us to outline the potential for the higher gold and silver prices last few months to lead to upside surprises with the Q2 earnings reports in the PM mining stocks and royalty companies. John highlights the $300 increased margin, compared to Q2 of 2023, that a royalty company like Sandstorm Gold (TSX: SSL) (NYSE: SAND) is forecasting and how significant that could be for cashflow generation.  He is interested in seeing if the largest and most followed gold producer, Newmont Mining (TSX: NGT) (NYSE: NEM) can really prove to the markets that they are seeing margin expansion, with higher metals prices outpacing their rising costs. We also review that many of the higher-cost miners could actually see the largest percentage increase to their margins once the Q2 numbers come in.

 

This leads into a discussion on whether we’ll see more senior producers generating good cashflows and potentially attracting new investment inflows, then start a more aggressive merger and acquisition cycle.   He mentions that when we starting seeing multiple larger miners courting larger projects like New Found Gold (TSX.V: NFG) (NYSE: NFGC) or even solid low-cost single-asset producers like Silvercrest (TSX: SIL) (NYSE: SILV), that it will really get the M&A momentum going in the sector.   John cautions against the potential for economic contraction later this year to potentially spill over into a pullback in the precious metals sector in sympathy, but entertains the converse thesis that the PMs could also diverge from the general equities in a more structural correction.

 

 

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Click here to visit the John’s Substack to keep up to date on his market and economic commentary.

Discussion
15 Comments
    Jul 08, 2024 08:37 PM

    There was nothing bearish about today’s action. The miners held up well compared to the metals.
    The XAU was able to fill 95% of Friday’s gap:
    https://stockcharts.com/h-sc/ui?s=%24XAU&p=D&yr=1&mn=7&dy=0&id=p86042064200&a=1363171409

    Reply
    Jul 08, 2024 08:06 PM

    Anglogold Ashanti looks extremely bullish as it foreshadows what’s to come for the whole sector. On Friday it closed at its high close of over a year ago and today’s “inside day” is statistically bullish. Friday’s gap will cause some to sell or delay buying but there’s a bigger gap from early March that remains open which should provide food for thought.
    https://stockcharts.com/h-sc/ui?s=AU&p=D&yr=1&mn=5&dy=0&id=p42844736257&a=1719921156

    Reply
    Jul 08, 2024 08:41 PM

    Sprott buys 33M shares of Cerro de Pasco @ $0.10 with a warrant included. One of the assets is hundreds of hectares of tailings piled up and ready to be run through a mill. Pretty good deal for him.

    Reply
      Jul 08, 2024 08:18 PM

      Terry:
      Thanks for that update. I have some of Cerro. Looks like I should have more.

      Reply
        Jul 09, 2024 09:59 AM

        Hi Lake: Chen Lin is buying Cerro that say’s a lot! I’m sure he beat Sprott to the punch! DT

        Reply
          Jul 09, 2024 09:26 AM

          Thanks DT. I wouldn’t be surprised that Chen is where I got the tip. I can’t remember but very possible as I read and listen to his opinions.

          Reply
    BDC
    Jul 09, 2024 09:12 AM

    https://tinyurl.com/bddmb9wj
    Likely NatGas Bottom!

    Reply
    Jul 10, 2024 10:58 AM

    I was going to buy into Clean Tech INC. CVW,v, but it got away yesterday and today, was a guest on this site last week.

    https://schrts.co/iAAmvaZN

    Reply
    Jul 10, 2024 10:16 PM

    Santacruz could be on a run to it’s top bolly band around $0.50 IMHO.

    https://schrts.co/chXdnybk

    Reply

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