We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The Zacks Analyst Blog Highlights: Franco-Nevada, Kinross Gold, Kirkland Lake Gold, Agnico Eagle Mines and Pretium Resources
Read MoreHide Full Article
For Immediate Release
Chicago, IL –October 25, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Franco-Nevada Corp. (FNV - Free Report) , Kinross Gold Corp. (KGC - Free Report) , Kirkland Lake Gold Ltd. , Agnico Eagle Mines Ltd. (AEM - Free Report) and Pretium Resources Inc. .
Here are highlights from Thursday’s Analyst Blog:
5 Gold Stocks to Buy on October’s Rate Cut Hope
Gold prices moved downward for nearly one month after witnessing an impressive rally in during the June-September period. However, recent softness in gold prices may be a good entry point for another rally expected from the beginning of next month. Trade-related conflict between the United States and China is far from being completely settled. Meanwhile, slowing pace of U.S. economic growth and global economic downturn are near-term concerns.
Against the backdrop of these headwinds, market participants are widely expecting a third rate cut by the Fed this month. Lower interest rates decrease the opportunity cost of holding non-yielding bullion, making gold cheaper for investors holding other currencies. Buying pressure on gold is likely to remain firm as investors will focus on precious metals as a store of wealth and hedge against market turmoil.
Slowing Pace of U.S. Economic Growth
The U.S. GDP in the second quarter of 2019 was 2%, well below the 3.1% rate achieved in the first quarter. What is more important is that, the latest estimation of the Atlanta Fed released on Oct 17, reported just 1.8% GDP growth for the third quarter.
U.S. retail sales in September fell 0.3%, its first decline since February. Core retail sales declined 0.1%. Core retail sales data is highly correlated to the consumer spending component of the U.S. GDP, which constitutes 66-70% of the country’s economy.
Moreover, U.S. manufacturing, which constitutes 12% of its GDP, contracted in the last two months. Lingering tariff war with China raised input costs for high-end U.S. products, resulting in slowing business investment. Furthermore, labor market, which remained robust despite trade jitters also witnessed lower job growth in September.
Global Economic Downturn
On Oct 15, The International Monetary Fund (IMF) reduced its growth forecasts for the global economy for 2019 and 2020. It predicts growth of 3% for 2019, down from its previous forecast of 3.2%. The world economy is expected to witness slight growth in 2020, lower than its previous projection of 3.5%. Moreover, the World Bank also squeezed its global growth forecast for 2019 to 2.6% from the previously forecast 2.7% growth.
On Sep 19, the Organization of Economic Co-Operation and Development (OECD), projected that the world economy will grow just 2.9% in 2019, the lowest forecast since 2009. The OECD had forecast 4% global growth in 2019 just 18 months ago.
Notably, China’s third-quarter 2019 GDP growth came in at 6%, lowest in 27 and half years. Several large economies of Eurozone, Japan and various emerging markets are also suffering from lower export demand due to the prolonged trade conflict between the two largest trading countries of the world.
Will Fed Opt for Third Rate Cut in October?
On Oct 8, Jerome Powell gave signals of a possible third rate cut this month. The FOMC is scheduled to meet on Oct 29-30. The central bank already reduced the benchmark lending interest rate by 50 basis points in two equal tranches in July and September. Rate cut happened for the first time in more than 11 years. Notably, as of Oct 24, the CME FedWatch assigned 93.5% probability of a 25 basis point rate cut in October while just 6.5% expects status quo to be maintained.
Powell cited a slowdown in the job growth rate and muted inflation along with global economic slowdown, due to the U.S.-China trade war, as the primary reasons for a likely third rate cut this year in order to honor the pledge to do the needful to sustain U.S. economic expansion.
Our Top Picks
At this stage, it will be prudent to invest in gold stocks with strong growth potential. We have narrowed down our search to five such stocks, which have skyrocketed year to date and still have upside left. Each of these stocks carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Franco-Nevada Corp.is a gold-focused royalty and stream company with additional interests in platinum group metals and other resource assets. The company has an expected earnings growth rate of 39.3% for the current year. The Zacks Consensus Estimate for the current year has improved by 3.8% over the last 60 days. The stock has surged 33.1% year to date.
Kinross Gold Corp. is engaged in the acquisition, exploration and development of gold properties in the United States, the Russian Federation, Brazil, Chile, Ghana and Mauritania. The company has expected earnings growth rate of 190% for the current year. The Zacks Consensus Estimate for the current year has improved by 11.5% over the last 60 days. The stock has soared 41.9% year to date.
Kirkland Lake Gold Ltd.is engaged in the provision of mining and mineral exploration. It focuses on gold assets primarily in Canada and Australia. The company has expected earnings growth rate of 71.3% for the current year. The Zacks Consensus Estimate for the current year has improved by 5% over the last 60 days. The stock has jumped 68.4% year to date.
Agnico Eagle Mines Ltd.is engaged in the exploration, development and production of mineral properties in Canada, Mexico and Finland. It primarily produces and sells gold deposit, as well as explores for silver, zinc, and copper deposits. The company has an expected earnings growth rate of 162.9% for the current year. The Zacks Consensus Estimate for the current year has improved by 7.3% over the last 60 days. The stock has climbed 31.2% year to date.
Pretium Resources Inc. acquires, explores for and develops precious metal resource properties in the Americas. It primarily explores for gold, silver and copper deposits. The company has an expected earnings growth rate of 220% for the current year. The Zacks Consensus Estimate for the current year has improved by 3.2% over the last 60 days. The stock has soared 43.5% year to date.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
The Zacks Analyst Blog Highlights: Franco-Nevada, Kinross Gold, Kirkland Lake Gold, Agnico Eagle Mines and Pretium Resources
For Immediate Release
Chicago, IL –October 25, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Franco-Nevada Corp. (FNV - Free Report) , Kinross Gold Corp. (KGC - Free Report) , Kirkland Lake Gold Ltd. , Agnico Eagle Mines Ltd. (AEM - Free Report) and Pretium Resources Inc. .
Here are highlights from Thursday’s Analyst Blog:
5 Gold Stocks to Buy on October’s Rate Cut Hope
Gold prices moved downward for nearly one month after witnessing an impressive rally in during the June-September period. However, recent softness in gold prices may be a good entry point for another rally expected from the beginning of next month. Trade-related conflict between the United States and China is far from being completely settled. Meanwhile, slowing pace of U.S. economic growth and global economic downturn are near-term concerns.
Against the backdrop of these headwinds, market participants are widely expecting a third rate cut by the Fed this month. Lower interest rates decrease the opportunity cost of holding non-yielding bullion, making gold cheaper for investors holding other currencies. Buying pressure on gold is likely to remain firm as investors will focus on precious metals as a store of wealth and hedge against market turmoil.
Slowing Pace of U.S. Economic Growth
The U.S. GDP in the second quarter of 2019 was 2%, well below the 3.1% rate achieved in the first quarter. What is more important is that, the latest estimation of the Atlanta Fed released on Oct 17, reported just 1.8% GDP growth for the third quarter.
U.S. retail sales in September fell 0.3%, its first decline since February. Core retail sales declined 0.1%. Core retail sales data is highly correlated to the consumer spending component of the U.S. GDP, which constitutes 66-70% of the country’s economy.
Moreover, U.S. manufacturing, which constitutes 12% of its GDP, contracted in the last two months. Lingering tariff war with China raised input costs for high-end U.S. products, resulting in slowing business investment. Furthermore, labor market, which remained robust despite trade jitters also witnessed lower job growth in September.
Global Economic Downturn
On Oct 15, The International Monetary Fund (IMF) reduced its growth forecasts for the global economy for 2019 and 2020. It predicts growth of 3% for 2019, down from its previous forecast of 3.2%. The world economy is expected to witness slight growth in 2020, lower than its previous projection of 3.5%. Moreover, the World Bank also squeezed its global growth forecast for 2019 to 2.6% from the previously forecast 2.7% growth.
On Sep 19, the Organization of Economic Co-Operation and Development (OECD), projected that the world economy will grow just 2.9% in 2019, the lowest forecast since 2009. The OECD had forecast 4% global growth in 2019 just 18 months ago.
Notably, China’s third-quarter 2019 GDP growth came in at 6%, lowest in 27 and half years. Several large economies of Eurozone, Japan and various emerging markets are also suffering from lower export demand due to the prolonged trade conflict between the two largest trading countries of the world.
Will Fed Opt for Third Rate Cut in October?
On Oct 8, Jerome Powell gave signals of a possible third rate cut this month. The FOMC is scheduled to meet on Oct 29-30. The central bank already reduced the benchmark lending interest rate by 50 basis points in two equal tranches in July and September. Rate cut happened for the first time in more than 11 years. Notably, as of Oct 24, the CME FedWatch assigned 93.5% probability of a 25 basis point rate cut in October while just 6.5% expects status quo to be maintained.
Powell cited a slowdown in the job growth rate and muted inflation along with global economic slowdown, due to the U.S.-China trade war, as the primary reasons for a likely third rate cut this year in order to honor the pledge to do the needful to sustain U.S. economic expansion.
Our Top Picks
At this stage, it will be prudent to invest in gold stocks with strong growth potential. We have narrowed down our search to five such stocks, which have skyrocketed year to date and still have upside left. Each of these stocks carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Franco-Nevada Corp.is a gold-focused royalty and stream company with additional interests in platinum group metals and other resource assets. The company has an expected earnings growth rate of 39.3% for the current year. The Zacks Consensus Estimate for the current year has improved by 3.8% over the last 60 days. The stock has surged 33.1% year to date.
Kinross Gold Corp. is engaged in the acquisition, exploration and development of gold properties in the United States, the Russian Federation, Brazil, Chile, Ghana and Mauritania. The company has expected earnings growth rate of 190% for the current year. The Zacks Consensus Estimate for the current year has improved by 11.5% over the last 60 days. The stock has soared 41.9% year to date.
Kirkland Lake Gold Ltd.is engaged in the provision of mining and mineral exploration. It focuses on gold assets primarily in Canada and Australia. The company has expected earnings growth rate of 71.3% for the current year. The Zacks Consensus Estimate for the current year has improved by 5% over the last 60 days. The stock has jumped 68.4% year to date.
Agnico Eagle Mines Ltd.is engaged in the exploration, development and production of mineral properties in Canada, Mexico and Finland. It primarily produces and sells gold deposit, as well as explores for silver, zinc, and copper deposits. The company has an expected earnings growth rate of 162.9% for the current year. The Zacks Consensus Estimate for the current year has improved by 7.3% over the last 60 days. The stock has climbed 31.2% year to date.
Pretium Resources Inc. acquires, explores for and develops precious metal resource properties in the Americas. It primarily explores for gold, silver and copper deposits. The company has an expected earnings growth rate of 220% for the current year. The Zacks Consensus Estimate for the current year has improved by 3.2% over the last 60 days. The stock has soared 43.5% year to date.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
See their latest picks free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.