The M&A boom in the precious metal sector that I’ve long predicted on these page has finally begun to blossom. [[LIHR]] supernova’d today on news of it’s rejection of egregious sexual advances from the Newmont Mining Corporation [[NEM]] and other encroaching crepuscular old men.
This will be only the beginning, as I have mentioned to you. Large, shambling behemoths like Newmont Mining Corporation [[NEM]] , Barrick Gold Corporation (USA) [[ABX]] and even the nimbler Goldcorp Inc. (USA) [[GG]] will be hungrily seeking small and medium sized asset-laden precious metal players like voracious toothed pelicans pursuing hapless baby ducks. Smack! Smack! Deeeelicious!
I expect that eventually, even the big general metal miners like Freeport-McMoRan Copper & Gold Inc. [[FCX]] and BHP Billiton Limited (ADR) [[BHP]] will get into the act, diluting themselves for my greater enrichment. What’s up today as a result? Better to ask what isn’t, but you can infer that the names with the greatest returns on an M&A day like today are very likely going to correlate with the names of other possible acquirees… among them:
Yamana Gold Inc. (USA) [[AUY]] , [[CDE]] , Eldorado Gold Corporation (USA) [[EGO]] , almost all the components of [[GDX]] and [[GDXJ]] ; silvers Hecla Mining Company [[HL]] and [[MVG]] (congrats to Employee8/Teahouse on this last one), and the two of “the three N’s:” NovaGold Resources Inc. (USA) [[NG]] and New Gold Inc. (USA) [[NGD]] .
Also, the silver cabelleros [[PAAS]] , Silver Wheaton Corp. (USA) [[SLW]] , Silver Standard Resources Inc. (USA) [[SSRI]] and [[SVM]] are all hot (and even stodgy [[SLV]] and his steroidal brother [[AGQ]] ), and let’s not forget platinum friends [[PAL]] and Stillwater Mining Company [[SWC]] . Last, let’s not forget “X” factor, recently unspun Exeter Resource Corp. [[XRA]] .
Untroubled by today’s rush are eight PM underperformers which may only be laggards to today’s action, and therefore bear watching: Allied Nevada Gold Corp. [[ANV]] , [[EXK]] , Gold Fields Limited (ADR) [[GFI]] , Gammon Gold, Inc. [[GRS]] , Golden Star Resources Ltd. (USA) [[GSS]] , Northgate Minerals Corporation (USA) [[NXG]] , Rubicon Minerals Corp. (USA) [[RBY]] , and Royal Gold, Inc. [[RGLD]] . You know that last is one of my all time buy and hold plays, so watch it especially here.
For my part, I will continue to ride the invisible neon flow of the Matrix, to the envy of my friends and the chagrin of my enemies. I wish I could tell you all the momentous things which currently abrade my precious thread of cohesion with you all, but it would just as likely cast you into the pit of despair as lift your spirits to the heavens.
Tomorrow is a day of Remembrance for me, and a day of quiet for the Markets. I will try to stop in to share cause and cost with you, but if we not speak, may you all be well, and good to one another.