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November 30, 2009 Dear Friend,
We downgraded Newmont Mining
to Underweight because its share valuation had risen,
approaching $408 per oz of recoverable reserves, or closer to
the premium valuations of younger companies like Goldcorp or
Agnico-Eagle that enjoy newer mines with lower costs. This is
more of a relative value judgement than a gold price viewpoint.
Costs of reserve replacement, operating costs, capital costs and
political risks weigh against an older, historic company like
NEM.
Most base metals prices fell
last week, and all base metals inventory levels again rose last
week.
Faithfully,
John C. Tumazos
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Copyright © 2008 John Tumazos Very Independent Research,
LLC
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