Kirkland Lake Gold (KL.TO)

A fantastically run company that had earnings in line with expectations. Cash costs are reasonable at $481 US per ounce. Gold is just starting to get the wind at its back. He would add to this one today. Yield 0.4%. (Analysts’ price target is $25.41 )

(A Top Pick Apr 5/17, Up 99.9%) He took his proceeds and followed management into Kirkland Lake. It is the people, not the companies that he follows. He made a tidy return.

He sold out of Kirkland too soon. It has one of the lowest cost gold mines in the world. It has gone up 140%. (Analysts’ price target is 25$)

They made a spectacular discovery underneath an existing mine in Australia, likened to a jewel box. They were already delivering good operating results in Canada and Australia. He was a founding shareholder.

Recent additions or discoveries in the deeper part of the ore body in Foster Hill in Australia, have been nothing short of spectacular. Some of the best drill holes he has seen in his career. Management seems to understand those deposits well enough that the drilling is becoming predictive. He very much likes this.

It has not been around in its current form for long enough for seasonal analysis. Technically it has been one of the strongest gold stocks in Canada. Historically it reaches a peak around now and goes into a period of weakness until the end of the year and then into another period of strength. You might want to take some money off the table.

Great management. One of the best performers and is up 128% year to date. Just under 600,000 ounces and is kind of a 2^nd quartile cost producer. Very good margins. Did a very big merger last year with New Market, which basically makes it an intermediate producer. From its Australian assets, there is a lot of upside in the near term. After 2 years, the Macassa mine in Canada, probably through a 2^nd shaft, can grow production by another 200,000 ounces. Great earnings.

He’s unloaded some of his gold. There are 2 seasonal periods for gold; January-February and July-November. The chart is showing a bit of a top. Although the stock is up in the last couple of days, all the gold complexes are going to come down a little. Whether they accelerate in July like they usually do is yet to be seen. Rate hikes going forward would give a bid to gold, but don’t be a believer until maybe we see yields pushed down a bit.

This mines in Ontario and Australia. A $2.5 billion market cap and over 500,000-ounce producer. Main assets are underground in safe jurisdictions with significant exploration upside. They have 2 major cornerstone mines. Good management. Dividend yield of 0.4%. (Analysts’ price target is $12.50.)

Primarily Canadian assets, but also active in Australia. The North American investor is more receptive to Canadian than global assets. His firm is one of the largest shareholders.

It is often talked about as a takeover candidate and there are going to be more and more acquisitions in the industry. It is a higher risk producer, but that means a higher potential upside.

This went down with the sector, but dropped a little more than most because of the new market merger. A lot of people didn’t like it because there was the Ontario operation, which they were doing well with, and suddenly 3 Australian properties were added in, so where is a fit and how does it work. This is one of the names he is adding. The balance sheet is in good shape, and it is one of the cash flow generators. (See Top Picks.)

Newmarket Gold (NMI-T) is supposed to be merging with this company, but a new bid has emerged for Kirkland Lake which would kibosh the takeover. However, Goldfields (GV-A) and Silver Standard (SSO-T) have come in over the top with their own bid. He believes most of the value is in the company, but it is lovely to see the auction we have seen. The 1^st transaction was a good one, and the 2^nd is even better. He is astonished at the price, and hopes buyers understand what they are doing.

He sold in the last month. It has really pulled back after an issue for capital. The market is having trouble chewing down their recent acquisition. It may be a pretty good buying opportunity. It has corrected more than other mid-sized golds.

These are extremely high quality people and you should Buy. However, the run we have seen is pretty impressive. Unless you own it as a component in a gold portfolio, it really depends on the person. If you own, he would recommend using a trailing stop.