3 Gold Shares Rising Strongly

LONDON -- The price of gold remained stable last week despite the eurozone bailout crisis in Cyprus, with gold for April delivery gaining just 0.1% to end the week at $1,606 per ounce.

Of course, the only practical way for most private investors to invest in gold is through exchange-traded funds. The largest gold ETF, the $63 billion SPDR Gold Trust  (NYSEMKT: GLD  ) , climbed 1.0% to $155.55 last week, while London-listed Gold Bullion Securities  (LSE: GBS  ) rose 0.9% to $155.16 over the same period. So far this year, shareholders of Gold Bullion Securities have seen the value of their holdings fall by 3.3%, while the value of SPDR Gold Trust shares has fallen by 4.0%.

Gold's big movers
Many investors prefer to invest in gold mining stocks, rather than gold itself, as gold miners are able to use their operational gearing to outperform the price of gold. Let's take a look at some gold stocks that outperformed the yellow metal last week.

Small-cap miner Aureus Mining  (LSE: AUE  ) ended the week up 8.2% to 41.3 pence, after it confirmed it had engaged a consortium of banks to arrange a $108 million project finance facility to complete the funding for its New Liberty Gold Project in Liberia. The cost of the financing will be approximately 5% per annum, and the company will not be required to hedge its gold output to protect repayments. In a separate filing last week, Aureus also confirmed that it is on schedule to deliver the first gold pour at the New Liberty project in the final quarter of 2014.

Timmins Gold  (NYSEMKT: TGD  ) climbed 6.6% to $2.93 last week after it reported a 72% increase in revenues and a 65% increase in operating profit for 2012. Gold production from Timmins' San Francisco mine in Sonora, Mexico, rose by 70% to 94,128 ounces last year and the company is forecasting a further increase in production to between 125,000 and 130,000 ounces in 2013.

Yamana Gold  (LSE: YAU  ) rose 7.2% to 1,027 pence last week, helped by a broker upgrade from Cowen & Co and the stabilisation of the gold price after recent falls. Yamana recently reported its 2012 results, which showed that the firm's gold production rose by 9% to 1.2 million gold equivalent ounces last year, including 1.02 million ounces of gold. Yamana remains one of the lowest-cost big producers in the gold industry, with cash costs per gold ounce of just $525 per gold equivalent ounce, despite some cost increases in 2012.

Shares vs. commodities
Shares in commodity companies have outperformed their underlying commodities many times over the last 10 years, thanks to their ability to magnify their gains through successful development of new resources. This free report from the Fool, "10 Steps to Making a Million From the Market" contains some excellent tips on identifying and investing in potential multibagger shares, including resource shares like gold miners. I strongly recommend that youclick here and download it now, as it will only be available for a limited time.


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Related Tickers

9/30/2016 11:11 AM
AUE $2.67 Up +0.30 +12.42%
Aureus Mining Inc… CAPS Rating: No stars
GBS $125.57 Up +0.23 +0.18%
ETF Securities Gol… CAPS Rating: No stars
GLD $125.64 Down -0.43 -0.34%
SPDR Gold Trust CAPS Rating: **
TGD $0.47 Up +0.00 +0.15%
Timmins Gold CAPS Rating: **
YAU $0.00 Down +0.00 +0.00%
Yamana Gold Inc. CAPS Rating: No stars