Ok....John Paulson is hated by outher hedge funds and they are laying on this stock... I know the stock is worth 10.00 if gold stays at 1500. But if gold starts to do a little noise dive, all bets are off on how low this thing can get. So what is a good entry point. Im investing in 25% stagies.
It may be that some of the 146 hedge funds with Apple positions are getting margin calls, necessitating selling other holdings. Virtually all the precious metals had big drops. I believe this sub-9.00 level is a gift long term.
In my opinion we are at a good entry point. I did. It has a book value of about $9.75 a share. Tremendous reserves. A 8:1 PE and a nice dividend. Layer on that $1.1 Billion in cash, and I cannot find another gold company with superior comps. All gold was off today. The metal was down. This is so low it seems absurd. Good luck.
My advice to you would to wait patiently until the stock begins going up again. It probably sound odd but my experience indicates that we will pretty much know when that happens. It won't likely be a head fake but rather a powerful move upward in a vertical formation. You will most likely miss the first 5 percent off the absolute low but it will worth it as a premium in exchange for the clarity of pretty much knowing the bottom is set.
As for the longs who are sucking wind right now, all I can say is stay strong. The thing is, the market action is revealing the true nature of the stock in its own weird way. My view is that IAG is either a SCREAMING BUY at $8.75 or either one of two things must be going on: first, some kind of fraud (which is actually quite rare) is going on in the books or in the ground; or second, the commodity is getting ready to take a major nosedive in price.
Barring those two very unlikely situations, what is happening on the face of things is what is really happening, that is to say, big money is bailing out because they have lost patience with the narrative with respect to management's transition to a new corporate model that will focus much more on being an operator of gold mines in North America (the Cote gold mine in northern Ontario will take until 2014 to begin production), Latin America and West Africa and less on the minority partner/royalty paradigm. And/or they are pi$$ed off because of the rising costs of production and development of new projects. And/or they don't like the news about Islamic revolutionaries threatening to take over the government in Mali. And/or they don't want to own a stock in which the shares go down the way IAG has been going down on Wednesday 15 percent on 12M shares traded and today with another 5 percent on 10M shares traded.
Ironically, all the reasons on the surface are why shareholders are most likely fleeing (excluding fraud and a major gold price selloff) are exactly the same reasons why IAG is a huge bargain now. Time will tell whether I am right or whether I am wrong.
Remember, IAG exposure in Mali comes in the form of a joint venture in which AngloGold is the operator and IAG merely collects its 41 percent of one and 40 percent on the other. In total, IAG collects 15 percent of its total gold from those Mali mines. It's most lucrative mine is in Latin America in which the firm is an operator that own 95 percent of the operation and the government owns the 5 percent. The lion's share of future gold production is located in the pipeline with the Ciote gold mine operation. In the meantime, IAG produces 830,000 ounces of gold (not mention its other interests) and generates more than a $1 a share in earnings. It only pays out a quarter of a buck in per annum dividends. IAG is projecting double digit percentage growth as far as the eye can see. And so it's presently trading at less than nine times 2012 earnings? Does that sound like a bargain to you?
Sentiment: Strong Buy