Summary and link to an article published on Seeking Alpha.com
Now May Be The Time To Buy Into The Gold Majors
The proposed Barrick/Randgold merger, assuming it is implemented, will likely lead to a positive re-rating of the whole sector.
Randgold’s management has been brought in by Barrick in an attempt to change the latter’s management philosophy for the better.
Barrick shareholders may not be happy with a greater involvement in Africa, but Randgold has seen over a decade of virtually uninterrupted growth, wholly in the ‘Dark Continent’.
A more liberal dividend policy is likely to be implemented by Barrick, in itself helping to stimulate investment interest.
The saying goes that the best time to buy into a market is when ‘blood is running in the streets’. After a series of mostly disappointing Q3 results, media and commentators have been climbing into the gold majors, and many of these have seen their stock prices sink to new interim lows. Now may thus well be the time to climb back into investing in these stocks as they are likely to be at, or near, their low points as long as the gold price remains where it is at the moment, or moves higher over the remainder of the year as we think it will…..
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