If handing over your precious metals for pennies on the dollar sounds like a dubious way to get cash for gold, consider a far more profitable alternative.
Before changes in working capital, Goldcorp generated robust cash flow of $321 million in the third quarter, good for a 35% increase over the comparable 2008 quarter. Net earnings of $114 million may grab some attention, since they represent a 62% decline year over year. But Fools are reminded that the third quarter of 2008 contained a $254 million foreign exchange-related gain, compared to the more recent period's $28 million charge. Adjusted earnings topped both prior-year results and analyst expectations.
Goldcorp President and CEO Chuck Jeannes would like you to focus on that cash flow: "Gold prices have exhibited continued strength and sustainability above $1,000 per ounce, and with our production and cash costs trending positively, the stage is set for continued strength in cash flow and profitability through the end of the year and beyond." My readers know where I stand on gold prices. After checking up on Goldcorp's progress on multiple development projects, this Fool also shares Jeannes' enthusiasm for Goldcorp's outlook.
At the Red Lake mining camp, Goldcorp has devised an interesting engineering solution to fast-track development of the nearby Cochenour deposit. It's approving a five-kilometer high-speed underground tram to transport ore directly to the existing Red Lake mill.
With beneficiaries Silver Wheaton
Like midtier smooth operator Yamana Gold
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 CAPS lists 47 potential investments, and you'll find Christopher's comments on most of them.
Fool contributor Christopher Barker can be found blogging actively and acting Foolishly in the CAPS community under the user name TMFSinchiruna. He tweets. He owns shares of Royal Gold, Silver Wheaton, and Yamana Gold. The Motley Fool has a gilded disclosure policy.