Manning Auctions, Webzen, Newmont Mining, and RandGold
CHICAGO--(BUSINESS WIRE)--Feb. 10, 2004
The relationship between gold, interest rates and the
dollar is a complex and constantly evolving one. Find out from the
specialists what recent developments mean and how to make profitable
investments in this environment. Read the full Experts Watch article
with commentary and recommendations on GREG MANNING AUCTIONS
(NASDAQ:GMAI), WEBZEN INC. (NASDAQ:WZEN), Newmont Mining (NYSE:NEM),
and RandGold (NASDAQ:RANGY); go to; http://at.zacks.com/?id=101
Here are the highlights from the Experts Watch column:
Throughout the financial analysis and investment world, one can
find a considerable number of triangles. Up and down arrows are
represented as equilateral or isosceles triangles. "Wedge" chart
patterns are designated by triangles. There is also the pyramid with
the triangular all-seeing eye on the back of a one-dollar bill. One of
the most interesting triangles, though, is the relationship between
gold, interest rates and the dollar. In this week's column, two
Experts square off on the future of all three, and weigh in with very
different opinions on the attractiveness of the shares of gold-mining
Dennis Slothower, editor of Stealth Stocks would not touch gold
shares with a ten-foot pole at the moment. Slothower feels that some
recent machinations of the Federal Reserve and the government
represent a "weak dollar policy" that is partly retribution for
diplomatic squabbles with Europe and the Middle East.
External to Slothower's portfolios, he offers "5 Stocks That Could
Double in a Year" in each monthly issue. They have outstanding track
records, and two from his February issue are:
GREG MANNING AUCTIONS (NASDAQ:GMAI) is a multi-category
business-to-business and business-to-consumer collectibles auctioneer
and merchant. For the three months ended 9/30/03, revenues rose 36% to
$34.5 million. Net income totaled $2.5 million versus a loss of
$339,000. Revenues reflect increased sales to Afinsa (a related
party), in which the company has exclusive agreements.
WEBZEN INC. (NASDAQ:WZEN) is a developer of online games in Korea.
The company's current and only game, MU, is a three-dimensional (3D)
multiplayer online role-playing game that has grown since its
introduction to become a popular online game in Korea and China. For
the nine months ended 9/30/03, total net revenues totaled W41.50
billion, up from W19.02 billion. Net income totaled W24.43 billion, up
from W10.16 billion. Results reflect an increase in online game
However, Ed Bugos, editor of the Goldenbar Report, continues to
think that the Dow is over-valued relative to the growth prospects for
2004. In fact, while he agrees that much of the profit boom was
related to an inflated money supply, low interest rates and a weak
dollar, Bugos feels that both are artificial and not reassuring
boosts. Bugos sees a relatively weak labor market, and profits that
improve only due to a debasement of the currency. Bugos thinks that
dollar bulls are excited by the recent bounce and will walk right into
a gold run.
According to Bugos' research, Newmont Mining (NYSE:NEM) tracks the
real price of gold more closely than any of the other companies he
follows. It has a very minimal hedge book of .3 years. Newmont has a
total cash production cost of $205/oz and Bugos expects the company to
continue to grow earnings about 10% a year for the next several years.
The company with the deepest discount based upon a comparison of
actual and implied prices of gold is RandGold (NASDAQ:RANGY), which
trades at .4x the price of gold given its cash flow. The company has a
minimal hedge book of .1 years and a 5-year earnings growth rate of
37.8%. It produces gold for a very reasonable $97/oz. It's weakness is
a shorter mine life than some of the other companies Bugos follows.
Read the full report with insight from the experts at Zacks.com:
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