The Basic Materials sector is 3.5% undervalued with the Gold Mining industry 5.2% undervalued, according to www.ValuEngine.com. All 14 of the stocks in today’s table have complete ValuEngine data and we have enough price data to have most value levels, risky levels and pivots.
AuRico Gold Inc. (AUQ) – has only been below $10 since March 6, 2012.
Aurizon Mines Ltd. (AZK) – has been below $8.50 for at least five years.
Banro Corp. (BAA) – has been below $10 since the week of April 4, 2008.
DRDGOLD Ltd. (DRD) – has been below $10 since the week of June 12, 2009.
Gold Reserve Inc. (GRZ) – has been below $7.75 for at least five years.
Golden Star Resources, Ltd. (GSS) – has been below $6 for at least five years.
Harmony Gold Mining Co. Ltd. (HMY) – has only been below $10 since August 17, 2012.
Midway Gold Corp. (MDW) – has been below $6.50 for at least five years.
Northern Dynasty Minerals Ltd. (NAK)– has been below $10 since the week of September 16, 2011.
NovaGold Resources Inc. (NG) – has been below $10 since the week of December 16, 2011.
Nevsun Resources Ltd. (NSU) – has been below $7.75 for at least five years.
Rubicon Minerals Corp. (RBY) – has been below $6.50 for at least five years.
International Tower Hill Mines Ltd. (THM) – has been below $10 since the week of April 29, 2011.
Exeter Resource Corp. (XRA) – has been below $8.50 for at least five years.
Reading the Table
OV / UN Valued – The stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage according to ValuEngine. The most overvalued stock in today’s table with DRD at 20.1% overvalued. The most are undervalued stock is NG by 53.7%.
VE Rating – A “1-Engine” rating is a Strong Sell, a “2-Engine” rating is a Sell, a “3-Engine” rating is a Hold, a “4-Engine” rating is a Buy and a “5-Engine” rating is a Strong Buy. Today we have ten Hold rated stocks and four Sell rated stocks.
Last 12-Month Return (%) – Stocks with a Red number declined by that percentage over the last twelve months. Stocks with a Black number increased by that percentage over the past twelve months! The biggest gainer is DRD up 24.0%. The biggest loser is XRA with a loss of 55.2%.
Forecast 1-Year Return – Stocks with a Red number are projected to decline by that percentage over the next twelve months. Stocks with a Black number in the Table are projected to move higher by that percentage over the next twelve months. The biggest loser is projected to be XRA with a potential loss of 9.4%. The biggest winner is projected to be HMY with a potential gain of 4.2%.
P/E Ratios – OMN has a single-digit P/E ratio. FOE has a seriously elevated P/E ratio.
Value Level: is the price at which to enter a GTC Limit Order to buy on weakness. The letters mean; W-Weekly, M-Monthly, Q-Quarterly, S-Semiannual and A- Annual.
Pivot: A level between a value level and risky level that should be a magnet during the time frame noted.
Risky Level: is the price at which to enter a GTC Limit Order to sell on strength.
Where to Buy and Where to Sell
A “Value Level” is a price at which buyers should add to positions on market price weakness. A “Risky Level” is a price at which sellers should reduce holdings on market price gains. A "Pivot" is a support or resistance (Value Level or Risky Level) that was violated in its time horizon, acting as a magnet during the remainder of that time horizon. These levels are calculated in weekly (W), monthly (M), quarterly (Q), semiannual (S) and annual (A) time horizons, based on the past nine closes in each time horizon. My theory is that the closes over a nine-year period are the summation of all bullish and bearish events for that market or specific stock. These levels are the most important element of my Buy and Trade Strategy.
Buy and Trade Guidelines
Investors should consider entering good until cancelled (GTC) orders to buy weakness to a value level, or to sell strength to a risky level.
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