Any person investing in IAG should consider the long haul with all the negative press put out by the media in reference to the future of gold. Said before but there is a 5% yield, extremely low book value, excellent balance sheet and just compare it with almost all companies in all sectors. Low PE compared to all stocks in all sectors with a strong management team already noting the fact they will cut cost including executive pay and travel expenses. Yes, it will do the bounces but as stated you are being paid to wait for the upturn whether its one or two or even three years, looking at the charts two years top. Yet just look at what gold prices were in 2003 etc and you will see IAG was up from even this low ridiculous level. Stupid to sell.
Thanks for the suggestion BUT, do you really think they will continue to kill the entire Basic Material sector for a long time? I would venture to say most mines would close, unemployment skyrocket, suppliers bankrupt, Cat and the rest would falter badly. You think they (our masters) really want this?
No one asks you to sell, first of all. It can be also said that on-board discussion, in good sense, is mostly about something to be done with future investments, i.e. it is more pressing issue what to do with the stock now: buy or avoid? Certainly, higher-risk lovers can discuss benefits of short-selling too.
Also, few technical points. This stock doesn’t have low PE ratio (it’s debatable whether it has any PE ratio) at the moment, as long as we talk about present profits, not some trailing numbers coming from very different times. Book value is largely irrelevant for mining stocks; there were many discussions, including very recent, on this board. Company can continue paying dividend for some time, but again high-yield is largely irrelevant in bad markets.
In total, it is a very tough environment. In my opinion, buying something here for long-term could be dangerous; again I don’t talk about shares that were already bought. It is unknown how long this bear market will continue and, more important, how much damage will be inflicted on gold equities. Also, investing money without much hope of good near-term return involves opportunity loss; the same money could be invested in other sectors.
We all have our investment strategies but I do look at Book value as one aspect. Investing in stocks that have already went up in value makes not one lick of sense since we all know stocks are bought and sold daily by various groups to the disadvantaage and detriment of the small investor. I'll take my chances with IAG unless you think they are a banrupt candidate and even you will not state that nor will you state that the odds of it going to single digit is a certainty. The economy is not growing, there is inflation, there is extended debt both private and public, there is no improvment in the employment picture and the national debt is a sham on all Americans. I see no leading economic indicators that would alter that opinion. Consequently gold has better then even odds to outshine a bloated stock market. I could cite example and examples of inflation, even Starbucks announced they are raising the price of coffee, look at Brazil, South Africa etc. inflation abounds. Our govt. prints whatever numbers satisfies their requirements to alter what is.
lvegasnelsonr, Thank You for your optimistic post.For the most part I agree, and am willing to hold
for even a protracted time line.Two years is ok with me.Sometimes, you have to break from the heard mentality.I just hope I can afford it.