Click Here for Gold Stocks To Watch For 2012
With Gold’s incredible run towards $2,000 in 2011, exchanges worldwide were booming with speculation trading in the precious metal. Earlier this week, gold exchanges in China, outside of two in Shanghai, were declared to be banned by Chinese government authorities. The notice, published on the central bank website (www.pbc.gov.cn), said the Shanghai Gold Exchange and the Shanghai Futures Exchange are enough to meet domestic investor demand for spot gold and futures trading. Gold exchanges have mushroomed across China, from the northern port city of Tianjin to Guangxi bordering Vietnam, as spot prices in the precious metal have eclipsed record highs in 2011.
Although Gold and Gold Stocks have boomed in 2011, many f them are trading at well below 50% of their 52 week High and some even teetering on gaining “penny stock” status by dipping below the $5 level. Of those at risk, Hecla Mining Co. (NYSE: HL), established in 1891, is one of the oldest mining companies in North America. Hecla is primarily involved in the discovery, production, and marketing of basic materials such as silver, gold, lead, and zinc. In mid-2011, HL was trading above $8. Even though HL increased its quarterly earnings by 200% over the last quarter, HL has lost over 50% market cap and over 50% in stock price.
Could this indicate a buying opportunity in a good stock or the decay of one of the oldest trading stocks in the NYSE? Hecla seems like a bargain right now; trading at a P/E ratio of 13.5, and P/FCF ratio of 8.38. The balance sheet is debt-free. I repeat, the balance sheet is debt-free. Hecla also has $1.5 of cash per share and as you can see below, the stock has multiple-bottomed and is ready for a rebound in 2012.
Hecla is the largest silver producer in the United States and oldest precious metals mining company in the U.S. Hecla and their Lucky Friday’s #4 Shaft project, combined with new pre-development initiatives at their four properties, is expected to increase production by approximately 50-60% by 2016. Hecla will develop a new haulage way to bypass the rock burst that occurred at the Lucky Friday mine on December 14. Creating the bypass and reestablishing mine production is expected to be complete by the end of February 2012.
Hecla’s silver output remains within its previous estimates with 2011 production expected at more than 9 million ounces and cash cost estimates remaining unchanged at approximately $1.00 per ounce, net of by-products. For 2012, Hecla expects to increase silver production to more than 9.5 million ounces including the loss of two months of production at the Lucky Friday mine while the bypass is completed.
In the past 12 months Hecla has made tremendous progress in its exploration efforts at its four large silver districts, three of which are in the U.S.; Greens Creek, Lucky Friday/Silver Valley, San Juan Silver JV, and San Sebastian in Durango, Mexico.
Financial Highlights (dollars in thousands for the 9mo/2011)
Sales of products: $ 374,767
Net income (loss): 132,595
Cash provided by operating activities: 187,938
Cash and cash equivalents of reporting period: 413,743
0% of Shares Held by All Insider and 5% Owners
57% of Shares Held by Institutional & Mutual Fund Owners
57% of Float Held by Institutional & Mutual Fund Owners
200 Institutions Holding Shares
Top 10 Institutional Holders (Shares held as of Sept 30, 2011)
15,126,627 – VANGUARD GROUP, INC. (THE)
13,187,012 – VAN ECK ASSOCIATES CORPORATION
9,235,879 – STATE STREET CORPORATION
9,098,000 – RCM CAPITAL MANAGEMENT
7,400,370 – BlackRock Institutional Trust Company, N.A.
6,344,096 – BlackRock Fund Advisors
4,996,373 – JENNISON ASSOCIATES LLC
4,921,815 – ROYCE & ASSOCIATES, LLC
4,815,540 – WENTWORTH, HAUSER AND VIOLICH
4,342,701 – NORTHERN TRUST CORPORATION
Top 10 Mutual Fund Holders (Shares held as of corresponding dates)
11,960,562 – Market Vectors ETF Tr-Gold Miners ETF (Oct 31, 2011)
4,204,120 – VANGUARD SMALL-CAP INDEX FUND (Sep 30, 2011)
4,062,117 – ISHARES RUSSELL 2000 INDEX FD (Oct 31, 2011)
3,246,751 – SPDR (R) Ser Tr-SPDR (R) S&P (R) Metals & Mining ETF (Oct 31, 2011)
3,238,944 – VANGUARD TOTAL STOCK MARKET INDEX FUND (Sep 30, 2011)
2,577,715 – ROYCE LOW-PRICED STOCK FUND (Sep 30, 2011)
2,247,074 – Prudential Jennison Small Company Fd (Oct 31, 2011)
2,203,212 – Global X Fds-Global X Silver Miners ETF (Oct 31, 2011)
2,044,100 – PENNSYLVANIA MUTUAL FUND INC (Sep 30, 2011)
1,969,019 – VANGUARD EXTENDED MARKET INDEX FUND (Sep 30, 2011)
Current Month (Mil) 24.30
Previous Month (Mil) 23.80
Hecla Mining Company (NYSE: HL) closing price in the stock market today was $5.03. HL is trading -15.04% below its 50 day moving average and -25.66% below its 200 day moving average. HL is -56.49% below its 52-week high and 4.36% above its 52-week low. HL‘s PE ratio is 12.21 and its market cap is $1.41B .
Current Price of Gold: Click Here
2012 Presidential Candidate Ron Paul who owns 26 Gold and Silver mining companies cares about the price of Gold: Click Here
About Hecla Mining Co.
Hecla Mining Company, together with its subsidiaries, engages in the discovery, acquisition, development, production, and marketing of silver, gold, lead, and zinc. The company produces lead, zinc, and bulk concentrates and sells them to custom smelters; and unrefined gold and silver bullion bars, which it sells to precious metals traders. It holds 100% interest in the Greens Creek operating unit located near Admiralty Island in Alaska; and 100% interest in the Lucky Friday operating unit located in Idaho. Hecla Mining Company founded in 1891 and is based in Coeur d’Alene, Idaho.
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