With gold prices now nearing $2,700, we could easily see $3,000 gold this year. All thanks to growing geopolitical tensions, interest rate cuts from the Federal Reserve, nearing U.S. elections, and growing tension in the Middle East. All of which could be beneficial for gold stocks such as U.S. Gold Corp. (NASDAQ: USAU), Barrick Gold (NYSE: GOLD) (TSX: ABX), Royal Gold Inc. (NASDAQ: RGLD), Franco Nevada Corp. (NYSE: FNV) (TSX: FNV), and Newmont Corp. (NYSE: NEM) (TSX: NGT). According to Reuters, “Gold market bulls are locking in bullion prices surging to fresh records, with a milestone of $3,000 per ounce coming into focus, fired up by monetary easing by major central banks and a tight U.S. presidential election race.”
Analysts at UBS also believe the Federal Reserve could cut interest rates by another 50 basis points this year followed by 100 basis points in 2025. They also note that conflict in the Middle East and Ukraine-Russia is no closer to resolution, strengthening the case for further gold upside. UBS added that “As Fed rate cuts finally materialize, demand from investors via exchange-traded funds (ETFs) looks set to gather pace too. According to the official gold ETF data published by the World Gold Council, inflows into gold ETFs continued in August for a fourth consecutive month.”
Look at U.S. Gold Corp. (NASDAQ: USAU)
U.S. Gold Corp. announce that as part of its fall investor marketing program, the company participated in the Precious Metals Summit Beaver Creek and Denver Gold Forum Americas Conferences from September 10-18, 2024.
As precious metals commodities continued to reach new highs, U.S. Gold’s management met with over 100 entities from around the world, including major and mid-tier mining companies, industry specialists, banking institutions, private equity and debt firms, concentrate marketers, royalty and streaming companies, as well as family offices and high net worth investors.
The Conferences emphasized that not all gold companies are created equal, in the same way as not all ounces are created equal. The key is to identify companies with a portfolio of high-quality assets located in stable, mining-friendly jurisdictions such as the United States, Canada and Australia, with experienced management teams and proven track records, having a clear vision for value and growth. In addition to low political risk and geological prospectivity, these jurisdictions offer the rule of law, clear and dependable mining legislation, established infrastructure and skilled labor.
Companies with proven reserves and resources, opportunities for expansion and optimization, combined with a solid pipeline of high-quality exploration prospects, possess the fundamentals that drive long-term growth. In surging commodity price cycles, one would expect to see the gold producers generating significant free cash flow, look to M&A and joint ventures to supplement their organic growth needs and bolster their project pipelines.
U.S. Gold embodies all the attributes of a premier sustainable growth company. Its gold-copper project, the CK Gold Project in Wyoming, located just 20 miles west of Cheyenne, offers abundant access to infrastructure and recently achieved the critical milestone of being granted a Surface Mine Permit from the Wyoming Department of Environmental Quality. Together with the district-scale Keystone Gold Project, located 11 miles from Nevada Gold Mines’ second largest gold producer in the Cortez Trend, and the prospective Challis, Idaho Gold Project, U.S. Gold Corp. is ideally positioned to benefit from an upward trending precious metal and copper market.
Other related developments from around the markets include:
Barrick Gold reported increased earnings and production for its second quarter, in line with guidance, and said the Company was on track for a strong second half of the year. Net earnings were up 25% and the attributable EBITDA margin2 was up 17% quarter on quarter to 48% with strong operating cash flows of $1.16 billion and a material increase in free cash flow3 to $340 million. Net earnings per share were up 24% to $0.21, adjusted net earnings per share3 increased by 68% to $0.32, and the quarterly dividend was maintained at $0.10 per share. President and chief executive Mark Bristow said while steering the Company towards the achievement of its 2024 guidance, management was also maintaining its focus on value creation and growth.
Royal Gold announced that its Board of Directors has declared its fourth quarter dividend of $0.40 per share of common stock. The dividend is payable on Friday, October 18, 2024, to shareholders of record at the close of business on Friday, October 4, 2024.
Franco Nevada announced that its wholly-owned subsidiary has acquired from Compan~i´a de Minas Buenaventura S.A.A. and its subsidiary, an existing 1.8% net smelter return royalty on all minerals covering Newmont Corporation’s Yanacocha mine and adjacent mineral properties located in Peru. Consideration for the Royalty consists of $210 million paid in cash on closing, plus a contingent payment of $15 million in Franco-Nevada common shares, payable upon achievement of certain conditions. “We are pleased to partner with Buenaventura to acquire this existing Royalty which adds immediately cash flowing gold production and growth from a leading gold operator,” said Paul Brink, President & CEO of Franco-Nevada. “Yanacocha has been one of the largest gold mines globally and the district covered by the Royalty remains highly prospective with over 47 Moz AuEq in total reserves and resources. The Royalty covers current oxide production, the planned sulfide project and high-quality growth projects, including Conga, which together have the potential to add decades of contributions to Franco- Nevada.”
Newmont Corp. announced second quarter 2024 results and declared a second quarter dividend of $0.25 per share. "Newmont delivered a solid second quarter, producing 2.1 million gold equivalent ounces and generating $594 million in free cash flow," said Tom Palmer, Newmont's President and CEO. "We continued to advance our divestiture program and, to date, have announced $527 million in proceeds this year. With this momentum, we completed $250 million in share repurchases and repaid $250 million in debt. As we head into the second half of the year, we remain confident in our ability to continue executing on shareholder returns, meet our full year guidance and deliver on our commitments."
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