Mother lodes are the stuff of legend. The Mount Morgan gold mine in Queensland, Australia, yielded yellow stuff for about 100 years. South Dakota's Homestake mine produced riches for more than 125 years. Geologists just don't seem to be finding lodes of that scale anymore, which simply heightens the significance of the larger mines still out there.
Elsewhere, Newmont is targeting a mid-2009 start-up for the Boddington mine in Western Australia with partner AngloGold Ashanti
As Newmont reported earnings Wednesday that essentially matched analyst expectations, and reaffirmed its 2008 guidance, I wonder how many paused to consider that Newmont shares presently trade about $10 per share below their most recent five-year low. In October 2003, when gold traded for less than $400 per ounce, Newmont shares sold for almost $15 more than they do today. Of course, the cost of production per ounce of gold was also much lower then, compared with the $480 per ounce cost reported for the latest quarter.
This Fool has already offered 700 billion reasons why gold will ultimately move substantially higher. This week, both Newmont and Barrick Gold
Newmont remains my favorite pick among the major miners, and at these prices, I perceive a substantial margin of safety. Still, I continue to favor the high-cash flow, low-cost kings of the intermediate miners, like Agnico-Eagle
Gold is a hot topic on the blogs at Motley Fool CAPS. Join the free service today and see just how many Fools are taking the long view when it comes to investing in gold. The "Gold" tag at Motley Fool CAPS lists 85 companies, and you'll find Christopher's comments on most of them.
Fool contributor Christopher Barker captains yachts and writes about stocks. He can also be found blogging actively and acting Foolishly within the CAPS community under the username TMFSinchiruna. He owns shares of Agnico-Eagle, Buenaventura, and Yamana Gold. The Motley Fool has a disclosure policy.