AUY

[stockhunter]

i'm working my way up to 225 lots.  I highly recommed you pop over to yahoo forums AUY forum.  It's very active

[BigSully1]

Bought AUY today at 10.47.  20 ema cross.  Chart looks good, fundamentals are unquestionably good. 

Analysts expect $1.20 in EPS in the next 4 quarters.  Conservative PE of 15 gives you $16 a share.  Most gold stocks trade at a PE in 25-30 range.  This is a no brainer unless there's some major flaw in the fundamentals I'm missing. 

Got in at 10.60.

[bjc]

Nice, BigSully.   I believe we made an excellent medium-term investment / trade.  Could also be short-term, as any type of rally with some force could bring a lot of people to realize how good the situation is here. 

This stock is just way too cheap.  Wall Street isn't naive enough to look at a trailing PE, I almost think there has to be something we're missing...

[BigSully1]

Yeah,  I think it's good. Sure there could be something missing, but I tend to believe the market is just pricing it irrationally, for now.  Anyway, if it does go back down ST, no sweat. I've left plenty of room to buy some more. I meant to load up on it anyway below 10, but procrastinated. It's definitely my favorite gold pick.

[bjc]

Another nice day for AUY.

Looks like GOLD is on the verge of a breakout, GOLD the commodity.  On the verge of breaking out of a long term symmetrial triangle (some kind of triangle anyway).


My confidence in AUY has nothing to do with any run in gold, though, it is purely based on an irrational valuation.

[bjc]

I smell a turnaround.   

This stock never had any reason to be in the gutter.  It was almost 50% off its highs at times for absolutely no reason. 

My target is $24 based on 20x analysts expectations in the next 4 quarters of $1.20.

[stockhunter]

i really recommend you look at options for AUY.  Most have gone up a lot, but still some money to be made.  I've done really well on it

[bjc]

Sure, you have to be up at least 100% in some of those.  Depending on how far out of the money you bought, you could be up even much more than that I guess.

I've done some paper trading with options.  I did it with some COST leaps about a month or more ago, that hasn't gone well I'm down 47% in those.

I did another one with some CHL options, the day I bought the stock (the luckiest timing I've ever personally experienced).  This was the day of the huge turnaround, I bought at 51.30 I believe.  After the market close, I paper-bought some out of the money leaps at whatever the ask was at the close, and they've skyrocketed.  Depending on if I bought in the money ones or how far out of the money (I forget which I did, I should've taken better notes for learning purposes).  But anyway, those are up 212%, 271%, and 334% (In this period I've made 29% in the stock).  It's interesting to see how far out of the money you go and see how your return is affected.

Also, I'm not qualified for Level 2 of options trading yet.  I need to get on the stick and get those papers in.  I would've been all over some AUY leaps..


On a sidenote, Gold the commodity is in breakout mode.  I'm not sure if I'd say it's confirmed, but acting very well.  This is just icing on the cake. 

[TerryG]

Gold is a surge breakout above $700, the commodity ETF is a 52 week high. The gold stocks have resumed an uptrend that started seven years ago. This is reflected in "It's a relative strength ratio of the Gold & Silver (XAU) Index divided by the S&P 500."

Gold stocks have fallen onto a lower trendline in the uptrend after this market correction. Just whether this trendline will hold.  My source is John Murphy at stockcharts.com. Subscription so I cannot post more.

[bjc]

I think the market is waiting on this merger to complete/ not happen / whatever.  I'm under the impression if the deal does go through, AUY will be a monster.  Price might be temporarily be hurt by a kneejerk market reaction, but the result will be a monster gold / copper producer.  I believe MDG is solely a gold producer, and I believe the CEO Marone or whatever his name is wants to be more of a gold miner than gold / copper as the company currently is.

If the deal doesn't go through, I think that'd be better for the short term.  I'm here for big bucks in AUY though, I want at least 50% to a double.


Currently the stock is dealing with both the uncertainty of the market with the FED tomorrow and the uncertainty of the deal.  Things will get resolved, and you might be able to get a better price somewhere, but I'm in locked and loaded ready for AUY to rock. 

Also, POG is still over 700 spot price.  Very bullish for AUY obviously.

[bjc]

AUY has been doing somewhat nicely.  Sully..we're up a bit less than 20%, but it doesn't really seem like it's moved so much.

If this deal would just happen or fail it'd be nice to get it out of the way.  I think that's what the market is waiting on, and both would be reacted to positively.  Short term, I think the deal failing would be the best proposition.

I'm positioned with AUY as my largest holding.  And I'm very happy about that.

I try to get a pulse for AUY on the Yahoo! message boards, but some of those guys on there are gold bugs, and I can hardly follow what they're saying.

[BigSully1]

AUY has been doing somewhat nicely.  Sully..we're up a bit less than 20%, but it doesn't really seem like it's moved so much.

If this deal would just happen or fail it'd be nice to get it out of the way.  I think that's what the market is waiting on, and both would be reacted to positively.  Short term, I think the deal failing would be the best proposition.

I'm positioned with AUY as my largest holding.  And I'm very happy about that.

I try to get a pulse for AUY on the Yahoo! message boards, but some of those guys on there are gold bugs, and I can hardly follow what they're saying.

I believe the deal will probably go through now and will make a great company. I sold yesterday because I was in fear of how much more AUY would offer, had to pay slightly more to get back in today. Also holding SLW.

[usedcasting]

Aggressive Company. Definitely no longer a Junior. Gold see's clear sky's.

uc.


Yamana Raises Bid, Wins Meridian
Monday September 24, 8:50 am ET
Yamana Boosts Meridian Offer to $35.18 Per Share, Winning Board Approval for Hostile Takeover

NEW YORK (AP) -- Canadian miner Meridian Gold Inc. agreed to be acquired by Yamana Gold Inc. after the gold miner further raised its hostile takeover bid to about $3.56 billion, the companies said Monday.

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Under the revised deal, Yamana agreed to pay Meridian shareholders 7 Canadian dollars ($7) in cash plus 2.235 Yamana common shares for each Meridian share they own. The purchase price works out to about $35.18 per share based on Friday's closing prices.

Reno, Nev.-based Meridian said in a joint statement with Yamana that its board unanimously recommends shareholders accept the offer. Meridian's financial advisers, Goldman, Sachs & Co. and BMO Capital Markets, agreed that the offer is fair financially, according to the statement.

"Our agreement provides Meridian shareholders with an attractive premium for their shares and a significant stake in a dynamic and growing company," Meridian President and Chief Executive Ed Dowling said in a statement.

Yamana, based in Toronto, launched its bid for Meridian in late June with an offer of a similar amount of stock plus 3.15 Canadian dollars per share. At the time, the offer was worth about $30.33 per share.

As part of the deal, Yamana planned to wrap in the acquisition of fellow Canadian gold miner Northern Orion Resources Inc. Yamana said Monday it plans to close that deal "as soon as practical after the successful tender of the Meridian shares."

"This agreement brings together three successful companies and is in the mutual interests of both Yamana and Meridian shareholders," Yamana Chairman and CEO Peter Marrone said in a statement.

The total purchase price is based on the 101.2 million Meridian shares outstanding in July, according to a regulatory filing by Yamana pertaining to the deal.

[bjc]

It seems I've been confused on my valuation of gold companies.

In many of the gold names (ABX, AU, GG, etc.), I see PEs in the 30 range.

But then you look at FCX, a gold, copper and silver producer, more comparable to AUY, trades at a PE around 10! 

After thinking about it much over the weekend, I've decided to sell half my AUY and move it into FCX.  I might sell all of my AUY.  It was a lucky 18% or so, I'll take the money and run.  I wish I'd been in MDG or NTO.  Oh well, this is a lesson to be more informed on deals a company you're investing in is doing..

[usedcasting]

A short squeeze looks possible here. Let's see where it goes.

uc.