Why McEwen Mining's Shares Popped

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What: Shares of McEwen Mining (NYSE: MUX  ) jumped as much as 12% today after the company released production figures.

So what: In the second quarter, the company produced 35,955 gold equivalent ounces, 30% higher than a year earlier. Both of the company's mines are producing at solid levels, and management thinks it can reach 130,000 gold equivalent ounces this year. 

Now what: The strong performance was good, and it didn't hurt that gold itself was up 2.9% today. The low price of gold has hurt miners, so they can use any good news they can get on the pricing front. McEwen hasn't yet posted a profit and, with gold under pressure, I would take a cautious approach to this stock, because even higher production may not make up for falling prices.

Gold has outshone the stock market overall with strong returns since 2000, but more recently, has given way to big declines, which has closed the gap with stocks. The Motley Fool's new free report, "The Best Way to Play Gold Right Now," dissects the recent volatility, and provides a guide for gold investing. Click here to read the full report today!

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Related Tickers

9/27/2016 10:15 AM
MUX $3.58 Down -0.11 -2.88%
McEwen Mining CAPS Rating: **