Yamana Gold Inc. (YRI.TO) Buy, Sell or Hold

Yamana Gold Inc. (YRI.TO)

7.89

+0.01 (0.13%)

as of Apr 3, 2023, 8:00:00 pm Market Open.

162 watching

COMMENT

It has been a growth story. A gatherer of smaller mine assets. He sees it as a bunch of small cap stocks. The market does not really pay for the lack of synergy opportunities. If gold goes up, so too will it.

DON'T BUY

They're trying to get rid of lots of assets in Brazil--that's their big problem. Look at their long-term debt and if they have enough working capital or need to raise money from the market. If gold prices stay low, it will be an issue for Yamana. Brent Cook: The are marginal assets--leveraged to the gold price--which aren't economical unless the gold price rises. Not economical because input prices rise. He avoids them.

DON'T BUY

It is always a year away from a pivot point in cash flow. He does not like the debt profile. He does not see catalysts to take them higher.

DON'T BUY

They reported mixed results last week. They carry a huge debt load which prevents him from buying. He does watch it, however.

COMMENT

Gold price is firmer than it has been. Could be a better year for gold. YRI had good production numbers today. Not his first choice. But overall, we're going to see more activity than we've seen in quite some time.

DON'T BUY

The company has wrestled with getting all their assets humming. He sees other operators that are more consistent. He would rather pay more for a consistent management team. He feels they are stuck in the mud.

PAST TOP PICK

(A Top Pick Jan 19/18, Down 19%) He wouldn't sell it here. the stock is cheaper now.

DON'T BUY

His longer term view on gold equities is that the next bull market will occur in the late 2020s. A series of lower highs, so not an area where he'd be putting a large chunk of money. It is a good defensive hedge. He prefers Kirkland Lake, whose chart is the exact opposite of this one. (Analysts’ price target is $4.25)

PAST TOP PICK

(A Top Pick Jan 19/18, Down 29%) Gold prices did not do well in 2018. He thinks this is very cheap right now and thinks he can suffer this out and fundamentals will eventually improve. Governments around the world are struggling and he thinks it is inevitable that gold will recover. He thinks everyone should hold 10% gold in their portfolio.

SELL

Neutral on gold these days. You invest when inflation rears its head as with some of these tariffs, but in the meantime, these stocks aren't going anywhere. Margins are being squeezed, and its debt has grown so that it's a cause for concern. Don't buy into commodity stocks right now, until we see global improvement, especially with China. Risk is too high. If you hold it, put your money somewhere else.

COMMENT

If we see resolution with the U.S. dollar, gold stocks will go gangbusters. We haven't yet tested 2016 lows of $2, yet. This didn't hold at $3.40 but oversold to $2.70. Good risk-to-reward now. That said, this could fall back to $2. The fate of the USD depends on when overseas repatriation is done, and good news from the China-US trade talks.

HOLD

It has been an horror show for people that bought it in 2014. Like gold itself it's been moving sideways since the beginning of 2017. If it breaks out, it could be a very positive story. (Analysts’ price target is $4.52)

BUY

Keeps looking at it. He focuses on good management, low cost of production, good reserves on the ground, and geo-politically stable. It’s getting to point of generating free cash flow. Great job of putting things together.

BUY

Has a $5.50 target and has been watching it. He likes this--it has good upside, low cost production and reserves in the ground in good locations. He likes the CEO. Below $4 is a good entry point.

BUY

His price target is $5.75. Well-managed with good locations in the Americas (Brazil, Chile, Argentina). A company that's well-priced from a revenue angle. Also, they have high reserves in the ground. But this stock requires patience. Worth buying.

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