Yamana Gold, Inc. (USA) (AUY)

GunLock123 (< 20) Submitted: 3/16/08 3:34 AM

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"At a PE of 53, it would take 53 years of company earnings for you to just break even on your investment"

That's assuming an earnings growth of zero (or inflation/taxes).If you haven't noticed yet, PEs are based on growth rates. That's not saying that I would like to buy this stock anytime soon.

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UncommonSense (88.56) Submitted: 3/19/08 12:47 PM

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I am assuming nearly 0% growth for gold because even if they somehow miraculously manage to boost production astronomically, it won't make up for the fact gold will trade back down to $500 an ounce in 3 years.

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mikane5 (78.62) Submitted: 4/16/08 7:43 PM

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The odds that gold will trade to $2000 before $500 are almost a "lock". Think of a barrel of crude going back to $50 before it goes to $120. They keep printing money, I keep buying Gold!

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TMFSinchiruna (95.41) Submitted: 4/17/08 5:06 PM

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With its buying spree completed, Yamana Gold is now turning its focus to organic growth from existing properties through 2012, with a projected increase in gold production from 1 million ounces in 2007 to a sustainable 2.2 million ounces per year by 2012. More importantly, it has one of the lowest cash costs per ounce of production in the business.

Gold will rise to $1,650 on its way to $2,000 and beyond, as this is NOT a recession we are in.... but rather the start of the Second Great Depression. The US Dollar is in free-fall and has no support in the horizon. I can hardly imagine a more undesireable trade than shorting AUY at this stage. It's worked out for you so far because you started your position just before a normal correction, but when this correction is over, I sure hope you'll be ending that short in a hurry. Gold's going to advance to $1,200 so fast it'll give you whiplash. :)

After the 12-18 month period you allude to above, let's meet back here and see where Yamana is trading. It'll be well over $30 by then.

Also, the P/E you are alluding to is a trailing P/E based on 2007 earnings, during which AUY had to unwind some unfortunate copper by-product contracts. Now that those are complete, and copper too is on the rise, AUY's earnings will undoubtedly, positively, surprise every analyst on the street.

The market was wrong to punish AUY when they bought Meridian and Northern Orion, and they're wrong again this time to have brought it back into the $14s. This is one of the very best buying opportunities anywhere for 2008.

For your sake, I hope you are not short AUY in real life. If you are, I strongly advise you to unwind it here.... your timing managed to earn you a few dollars, take it and run. If you keep your short... don't say I didn't warn you.

The company is targeting $2 billion in free cash flow by the end of 2010.

Now THAT's a WOW! :)

Fool on... sometimes disagreements are what CAPS is all about... if we all agreed we would grow lazy. :)

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soyelpato (77.94) Submitted: 4/18/08 3:05 PM

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oil up.

gold up.

basics up.

unemployment up.

inflation up.

i'm betting on gold however i can get it. 3 years to 500? not for me, 3 years to the top of the gold secular bull, maybe.

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UncommonSense (88.56) Submitted: 4/19/08 12:03 PM

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No, you are wrong my man. Gold is not going to $2000 an ounce any time soon, the U.S. is not going into a prolonged recession (let along a depression...) and your portfolio will be left in shambles. I recommend you close your gold positions before the economy is back on its feet.

And finally, I don't care if Yamana is the best of breed in gold mining or that it has the lowest cost per output, the fact is, it is over-valued at these price levels. If Yamana traded back down to $12, you might have a buyer in me. But right now I think the risks seriously outweigh the rewards.

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joelbow7 (74.26) Submitted: 4/21/08 2:14 PM

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If the US money supply is increasing by 16% a year and the government is handing out dollars for free to business and individuals how do you calculate that gold is going to $500/oz??? I think that is an untenable fantasy.

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soyelpato (77.94) Submitted: 4/23/08 12:16 PM

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handing out money for free and holding the worst of the worst financing arrangements as security against the "loans."

if gold goes to 1500, that represents pure profit, and the PE will be approximately cut in half.

current POG 900 - 400 (conservatively) = 500 earnings per ounce.

raise the POG to 1500 = 1100 earnings per ounce for doing the same work.

a prolonged recession is on.

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Daddyo777 (44.17) Submitted: 4/24/08 9:45 AM

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I bought at 12.84 out at 19.00

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madinga (< 20) Submitted: 4/28/08 10:44 PM

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Nice buy!!

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TMFSinchiruna (95.41) Submitted: 4/29/08 10:52 AM

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You have your chance here to buy back into Yamana in the $12 range. I never thought we'd see the day, and I see nothing rational about this pricing of the shares by the market. Therefore, I predict these levels will be short-lived. Let's talk when Yamana's back over $20... and then again when its over $50. :) Fool on!

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UncommonSense (88.56) Submitted: 4/29/08 1:55 PM

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....the only fool here is you sinchiruna

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KipLargo (75.30) Submitted: 5/06/08 9:58 AM

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Come out of recession, we just barely at the beginning of one. Plus, the cost of gold certainly justifies the PE. Just as oil will never be below a $100 a barrel, gold will soon never be under a $1000 and once.

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sarkasm (98.45) Submitted: 5/14/08 3:30 PM

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Gold will go up, but not in such a rally like before. Inflation is real thing and Europe's currency is overheated.
People around the world are getting richer and will seek gold. Don't forget that gold is used in industrial applications too. P/E is now at 38. Gold has real value. It is something to keep at your portfolio as an economic indicator. I don't think this country will come out of economic downturn that fast. It is going to be slow process. Until fed will start cranking up interest rates, we will be still in pretty shaky situation. That is not going to happen any time soon. Hold to gold.

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MANORBORN1950 (37.23) Submitted: 5/24/08 12:08 PM

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IF A COMPANY HAS A PRODUCT THAT IS INCREASING IN THE VALUE OF THE MARKET AND THAT COMPANY ALSO BECOMES MORE EFFICIENT AT PRODUCTING THAT PRODUCT , DOES THE PRICE OF THE STOCK BECOME CAPITIVE OF SOME RATIO OF PRICE TO EARNINGS OR BECOMES PRICED AT IT'S ABILITY AT BECOMING MORE PROFITABLE , AS TO INCREASING IT'S PROFITS ? THAT IS A QUESTION THAT THE MARKET PLACES ON THE PRICE OF A STOCK , NOT JUST SOME RATIO THAT'S EITHER HIGH OR LOW IN THE MIND OR SIGHT OF INDIVIDUALS !

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kidkotch (< 20) Submitted: 6/11/08 4:33 PM

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You may have knowledge of PE ratios etc, but it seems you're not paying attention to what is happening with the worlds (Yes, not just the US) paper money supply or the parallels to historical collapses of fiat money. Talk about following the masses. The government is hiding facts and figures, and we're all going to pay the price for it's, and our own shortsightedness. The dollar is dieing, for that alone, gold is going to skyrocket. Some analysts are even saying that we may see gold at up to $8000 per ounce within 5 years.

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