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Four Stocks That May Benefit From Rising Gold

Source: Streetwise Reports 01/05/2024

As the U.S. Federal reserve considers reducing interest rates, gold looks set to rally in 2024. Read on to see which four stocks look set to benefit from the gold market.

As the U.S. Federal Reserve is considering cutting interest rates into 2024, investors have found renewed interest in gold. The metal is commonly seen as a “safe haven” for investors when confidence in the economy is low.

According to analyst Rick Mills of Ahead of the Herd, “gold and silver have both held up quite well despite the Fed’s tightening cycle, with gold gaining 12.6% year to date, and silver more or less flat, beginning 2023 at US$24.00 per ounce and trading at US$24.29 as of this writing on December 22.”

Mills named three causes for gold’s performance, including the anticipated actions of the Federal Reserve, high national debt, and interest from central banks. Mills reports that gold buying from central banks has been fueled by a desire for independence from the American dollar, especially on the part of countries such as Russia, China, and Saudi Arabia, which have a rocky relationship with the United States.

Stewart Thomson of 321 Gold reported on December 12 of this year that he expects positions on gold to be profitable in 2024. The analyst believes that, in addition to rate cuts, the value of gold is being propelled upward by unease generated by international conflict, particularly in Israel.

Finally, there may also be an unexpected relationship affecting the value of gold. McAlinden Research reported on December 5, 2023, that trends in Bitcoin and gold often follow similar patterns due to the shared characteristics of both assets. McAlinden stated, “The gold miners’ resources are relatively scarce, whereas the Bitcoin miners’ resources are absolutely scarce.” As a result, Bitcoin has sometimes been referred to as “digital gold” and is also seen by some as a safe investment when the dollar is volatile.

Gold may be in the final stages of preparing to rally, reported analyst Jordan Roy-Byrne with The Daily Gold. Roy-Byrne commented, “Gold has already made a new monthly and weekly all-time high, but there is no looking back once the market clears US$2100… These are the final resistance levels before a full-blown, raging bull market in precious metals.”

Perpetua Resources Corp.

Perpetua Resources Corp. (PPTA:TSX; PPTA:NASDAQ) announced in a press release from November 13, 2023, that it had released its financial results for Q3 of 2023 and indicated several highlights for the company, including no environmental spills, a closing of a critical minerals award from the U.S. Department of Defense worth US$24.8 million, along with a new award of up to US$15.5 million in Defense Department funding. [OWNERSHIP_CHART-10820]

Perpetua also recently hired a new Vice President of Projects and welcomed a new Board member with significant operational experience as it progresses towards the next phase of its Stibnite Gold Project.

Mike Niehuser with ROTH Capital Partners reviewed the company on August 30, 2023, and rated it as a “Buy” for potential investors, and named a target share price of US$7.25, representing a potential return on investment of 129%.

The company has several catalysts to report, including permitting and milestones expected in 2024 and construction expected to begin in 2025. Perpetua owns one of the largest gold reserves in the country and the only reserve of antimony, which is a critical mineral used in ammunition manufacturing. This makes PPTA particularly interesting, given the geopolitical tensions around the world.

Reuters provided a breakdown of the company’s ownership and share structure, where management and insiders own 0.37% of the company. According to Reuters, CFO Jessica Marie Largent owns 0.09% of the company with 0.06 million shares, Director Christopher James Robinson owns 0.08% of the company with 0.05 million shares, President and CEO Laurel Sayers owns 0.08% of the company with 0.05 million shares, VP of Permitting Alan Douglas Haslam owns 0.05% of the company with 0.03 million shares, Director David L. Deisley owns 0.02% of the company with 0.01 million shares, General Counsel L. Michael Bogert owns 0.02% of the company with 0.01 million shares, VP of External Affairs Mckinsey Lyon owns 0.01% of the company with 0.01 million shares, Director Robert Alan Dean owns 0.01% of the company with 0.01 million shares, and Director Tanya Nelson owns 0.01% of the company with less than 0.01 million shares.

Reuters reports that institutions own approximately 66.1% of the company, as Paulson & Co. Inc. owns 39.15% of the company with 24.77 million shares, Kopernik Global Investors, LLC, owns 8.30% of the company with 5.25 million shares, Sun Valley Gold, LLC, owns 7.51% of the company with 4.75 million shares, BlackRock Institutional Trust Company, N.A. owns 2.57% of the company with 1.63 million shares, Krilogy Financial LLC owns 2.38% of the company with 1.51 million shares, B. Riley Financial, Inc., owns 2.32% of the company with 1.47 million shares, Eidelman Virant Capital owns 1.51% of the company with 0.96 million shares, Franklin Advisers, Inc. owns 0.86% of the company with 0.54 million shares, Russell Investments Trust Company owns 0.76% of the company with 0.48 million shares, and Earth Resource Investment Group own 0.74% of the company with 0.47 million shares.

According to Reuters, there are 63.27 million shares outstanding with 63.04 million free float traded shares, while the company has a market cap of CA$217.69 million and trades in the 52-week period between CA$3.32 and CA$7.32.

Strikepoint Gold Inc.

On November 17, 2023, Strikepoint Gold Inc. (SKP:TSX.V; STKXF:OTCQB) was included in a list of four stocks beneficial for investors as the gold market does well. [OWNERSHIP_CHART-209]

The list cited the company’s findings on the Walker Lane gold trend and the company’s plan for follow-up drilling on the property.

Technical Analyst Clive Maund reviewed the company in September of 2022 and rated the company as “an Immediate Speculative Buy” for potential investors. Maund commented, “It has already broken out of the countertrend Flag by moving sideways over the past week or two. So, it looks like it will get moving anytime now, especially when the pressure comes off the sector.”

According to the company’s investor presentation, there are a number of catalysts, including geophysical studies, permitting, and drilling planned for the Cuprite Project.

Reuters provided a breakdown of the company’s ownership and share structure, where management and insiders own approximately 0.86% of the company. According to Reuters, Executive Chairman Shawn Khunkhun owns 0.55% of the company with 1.17 million shares, President and CEO Michael G. Allen owns 0.14% of the company with 0.30 million shares, Director Ian Richard Harris owns 0.13% of the company with 0.28 million shares, Director Adrian Wallace Fleming owns 0.04% million shares with 0.08 million shares.

Reuters reports that institutions own approximately 16.42% of the company, as 2176423 Ontario, Ltd. owns 13.96% of the company with 29.84 million shares, U.S. Global Investors, Inc. owns 1.29% of the company with 2.75 million shares, and Sprott Asset Management LP owns 1.17% of the company with 2.50 million shares.

According to Reuters, there are 213.78 million shares outstanding with 182.1 million free float traded shares, while the company has a market cap of CA$7.29 million shares and trades in the 52-week period between CA$0.04 and CA$0.10.

Dakota Gold Corp.

Dakota Gold Corp. (DC:NYSE American) announced in a press release on November 21, 2023, that it had intercepted high grades on the Richmond Hill Gold Project. The company reported that it had found 0.575 ounces per ton of gold within an overarching intercept of 0.249 ounces per ton of gold. [OWNERSHIP_CHART-7442]

Peter Bell of Canaccord Genuity reviewed the company in August of 2023, rated the company as a “Speculative Buy” for investors, and named a target share price of US$5.50 per share with a potential return on investment of 86%.

As for catalysts, the company reported that it planned on releasing further results in 2024, along with follow-up drilling that it expected to yield even more exceptional results.

Reuters provided a breakdown of the company’s ownership and share structure, where management and insiders own approximately 20.43%. According to Reuters, Co-Chairman Robert A. Quartermain owns 8.46% of the company with 7.34 million shares, President and CEO Jonathan T. Awde owns 7.13% of the company with 6.18 million shares, and COO Gerald Michael Aberle owns 4.84% of the company with 4.20 million shares.

Reuters reports that institutions own 23.38% of the company, as Fourth Sail Capital LP owns 5.33% of the company with 4.62 million shares, while Van Eck Associates Corporation owns 3.50% of the company with 3.04 million shares, BlackRock Institutional Trust Company, N.A., owns 3.38% of the company with 2.93 million shares, The Vanguard Group, Inc. owns 3.06% of the company with 2.66 million shares, Fidelity Management & Research Company LLC owns 2.89% of the company with 2.50 million shares, CI Global Asset Management owns 2.80% of the company with 2.43 million shares, and 1832 Asset Management L.P. owns 2.42% of the company with 2.10 million shares.

According to Reuters, there are 86.74 million shares outstanding with 67.47 million free float traded shares, while the company has a market cap of CA$242.87 million.

Emerita Resources Corp.

Emerita Resources Corp. (EMO:TSX.V; EMOTF:OTCMKTS; LLJA:FSE) recently announced drilling results from the La Romanera deposit of its Iberian Belt West project, where the company intersected as much as 1.87 grams per tonne of gold and 23.0 grams per tonne of silver. [OWNERSHIP_CHART-10036]

Reaching the end of 2023, President Joaquin Merino said, “This has been a watershed year for the company and the development of the IBW project.”

Varun Arora of Clarus Securities reviewed the company in June of 2023 and rated the company as a “speculative buy” with a target share price of CA$3.75 and a potential return on investment of 608%.

The company’s investor presentation revealed a number of catalysts, including ongoing drilling at Nuevo Tintillo and La Romanera and updates for the company’s MRE and economic study.

Reuters provided a breakdown of the company’s ownership and share structure, where management and insiders own 5.61%. According to Reuters, Chairman Michael Lawrence Guy owns 1.84% of the company with 4.32 million shares, CEO David Patrick Gower owns 1.18% of the company with 2.76 million shares, President Joaquin Merino-Marquez owns 0.89% of the company with 2.09 million shares, Director Catherine Stretch owns 0.68% of the company with 1.60 million shares, Director Marilia Bento owns 0.434% of the company with 1.00 million shares, CFO Gregory Duras owns 0.28% of the company with 0.65 million shares, Corporate Secretary Damian J.D. Lopez owns 0.20% of the company with 0.46 million shares, and Executive Vice President Ian T. Parkinson owns 0.11% of the company with 0.25 million shares.

Institutions own 10.03% of the company, as Eric Sprott owns 8.71% of the company with 20.45 million shares, Merk Investments LLC owns 1.17% of the company with 2.75 million shares, Palos Management Inc. owns 0.09% of the company with 0.20 million shares, and Timelo Investment Management Inc. owns 0.06% with 0.14 million shares.

According to Reuters, there are 234.82 million shares outstanding with 201.31 million free float traded shares, while the company has a market cap of CA$123.55 million and trades in the 52-week period between CA$0.26 and CA$1.03.

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Important Disclosures:

  1. Perpetua Resources Corp., Strikepoint Gold Inc., Dakota Gold Corp., and Emerita Resources Corp. are billboard sponsors of Streetwise Reports and pay SWR a monthly sponsorship fee between US$4,000 and US$5,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Dakota Gold Corp.
  3. Amanda Duvall wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
  4. The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.

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( Companies Mentioned: DC:NYSE American,
EMO:TSX.V; EMOTF:OTCMKTS; LLJA:FSE,
PPTA:TSX; PPTA:NASDAQ,
SKP:TSX.V; STKXF:OTCQB,
)

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