| Should You Worry about Senior Gold Miners’ Liquidity? | |
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Worth Their Weight in Gold? Potential Upside for Gold Stocks (Continued from Prior Part) Liquidity position
While financial leverage is important to gauge a company’s long-term solvency, short-term liquidity profiles are also important. In a weaker commodity price environment, short-term liquidity might come under more pressure. A company could be forced to take drastic measures.
Current ratio
The current ratio is one way to estimate a company’s liquidity. The above graph shows gold miners’ current ratio. It shows a company’s ability to pay its short-term obligations using its short-term assets.
Companies’ positions
The higher the ratio, the better the company can service its short-term liabilities and vice versa. Kinross Gold (KGC) and Newmont Mining (NEM) are doing the best in this parameter while Yamana Gold (AUY) is doing the worst. Along with a good solvency position, Agnico Eagle Mines (AEM) also has a very comfortable liquidity position with current ratios of 2.9x. Unlike leverage, Barrick Gold’s (ABX) liquidity is comfortable with a ratio of 2.5x.
Combined, Newmont Mining and Barrick Gold form 13% of the Market Vectors Gold Miners ETF (GDX). Investors can access the gold industry by investing in gold-backed ETFs like the SPDR Gold Trust (GLD).
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Yamana Gold Inc.
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PRODUCER |
CODE : YRI.TO |
ISIN : CA98462Y1007 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Yamana Gold is a gold producing company based in Canada. Yamana Gold produces gold, copper, molybdenum, silver and zinc in Argentina, in Brazil and in Chile, develops copper, gold, lead, molybdenum, silver and zinc in Argentina and in Mexico, and holds various exploration projects in Brazil. Its main assets in production are ALUMBRERA and GUALCAMAYO in Argentina, MINERA FLORIDA and EL PEÑON in Chile and FAZENDA BRASILEIRO, JACOBINA, CHAPADA MINE, SÃO VICENTE, FAZENDA NOVA and SÃO FRANCISCO in Brazil, its main assets in development are AGUA RICA in Argentina and MERCEDES in Mexico and its main exploration properties are MILLO in Peru, FERGUSSON ISLAND in Papua New Guinea, PICACHO in Mexico, CAIAMAR, PILAR, PAU A PIQUE, C1 SANTA LUZ and ERNESTO in Brazil and AMANCAYA and JERONIMO in Chile. Yamana Gold is listed in Canada, in Germany, in United Kingdom and in United States of America. Its market capitalisation is CA$ 7.5 billions as of today (US$ 6.0 billions, € 5.2 billions). Its stock quote reached its highest recent level on December 06, 1996 at CA$ 98.91, and its lowest recent point on August 22, 2003 at CA$ 1.20. Yamana Gold has 948 040 000 shares outstanding. |