A Bad Year for Brigus Gold

As 2011 comes to a close, it's a great time to look back at what happened to the stocks that interest you. By making sure you know the important things that a company accomplished -- as well as the setbacks it experienced -- you can make a better decision about whether it's a smart investment for your portfolio.

Today, let's take a look at Brigus Gold (AMEX: BRD  ) . Even though the price of gold bullion has risen significantly, gold finds itself well below its highs of the year, and several miners have actually posted losses. Brigus took a particularly hard hit, losing half its value so far in 2011. Below, I'll take a closer look at the events that moved shares of Brigus Gold this year.

Stats on Brigus Gold

Year-to-Date Stock Return (51%)
Market Cap $202 million
1-Year Revenue Growth (15.5%)
1-Year Profit Growth NM (loss of $44.7 million)
Cash / Debt $20.2 million / $54.8 million
CAPS Rating ****

Source: S&P Capital IQ. NM = not meaningful due to negative earnings.

Why'd Brigus Gold get tarnished in 2011?
Coming into 2011, many investors had high hopes for Brigus. The company had gotten rid of previous gold hedges that had prevented it from realizing the full extent of the jump in gold prices, and with its existing Black Fox mine showing better production and a second mine in the works for 2013, the prospects for Brigus were bright enough to attract investors like hedge fund Sprott Asset Management.

In particular, Black Fox looks extremely promising. As Fool gold expert Christopher Barker wrote about in June, the mine is in the middle of Ontario's gold country, with a Goldcorp (NYSE: GG  ) mine nearby. With former Barrick Gold (NYSE: ABX  ) mining senior director Richard Allan as COO, Brigus has moved to its second phase of open pit mining and has seen impressive results.

Consolidation in the industry could eventually bode well for Brigus. Earlier this year, fellow turnaround story AuRico Gold (NYSE: AUQ  ) bought out Northgate Minerals, forming a combined company with massive total resources. Yet for now, prices for many small miners, including Paramount Gold & Silver (AMEX: PZG  ) and Taseko Mines (AMEX: TGB  ) , are so low that you essentially get some reserve exposure for free.

The big threat for Brigus is a correction in gold prices, which could erode confidence in the company's turnaround. But with promising production prospects, Brigus could well overcome even a drop in gold going forward.

If you like gold, there's another stock you should also look at. Read the Motley Fool's latest special report on gold to find out the tiny gold stock digging up massive profits. It's free but only available for a limited time.

Click here to add Brigus Gold to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

Fool contributor Dan Caplinger doesn't own shares of the companies mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool has a disclosure policy.


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