December 15th, 2015

Dawes Points: Significant New Upleg Likely for Gold Stocks

In this issue: Inflationary pressures and higher prices are building for gold and resources commodities, but how should you play it and which stocks should you look at? Read this latest Dawes Points to better understand the global forces that drive resources sector investment.

Key Points

- Australian gold industry output up to 18 year high of 298t.

- Gold sector balance sheets strong

- Earnings surging with dividends and payout ratios rising

- Exploration adding to resources for most companies

- Resolution of trench warfare in gold price battle coming soon

- Silver and other 'white metals' moving higher

- Copper price has broken through US$2.75/lb, US$3.30 next

- Emerging economies now 39% of global GDP and 58% of pop

- US expansion will push commodities and inflation higher

- US$95/t mid year 2017 target in iron ore already achieved

- Stock buys include;

o Northern Star Resources (ASX:NST)
o Newcrest Mining (ASX:NCM)
o Westgold Resources (ASX:WGX)
o Resolute Mining (ASX:RSG)
o Tribune Resources (ASX:TBR)
o Blackham Resources (ASX:BLK)
o Cardinal Resources (ASX:CDV)
o Beadell Resources (ASX:BDR)
o Stonewall (ASX:SWJ)
o Pantoro (ASX:PNR)
o Perseus Mining (ASX:PRU)
o Torian Resources (ASX:TNR) and
o Tyranna Resources (ASX:TYX)

- BHP Billiton (ASX:BHP), Rio Tinto (ASX:RIO) and Fortescue Metals (ASX:FMG) are also strong BUYS

The December quarterlies for the Australian industry showed the gold companies delivered strong evidence of operational improvement, excellent cash operating margins, builds in cash and also exploration success in extending existing mineralised zones and finding new. Mine life expectations are being extended. Earnings reports are also coming through with big gains and more dividends.

Gold production in 2016 reached a 19 year high of 298 tonnes and should make a new record high in 2018 (refer to image in link below).

The sector is doing well and is awaiting the coming pick up in the gold price that will push valuations higher to test 2016 highs and the XGD.ASX to move above 6000.

To view the complete Dawes Points Issue #62 including all images, graphs and tables, please visit the link below:

About Martin Place Securities:

Martin Place Securities is Australia's Boutique Resources Investment Firm, specialising in emerging mining, resources and energy companies.

MPS was founded in October 2000 to provide a link between Australian resource sector opportunities and investors from major financial centres in Europe, North America and China. We are well known for identifying and financing early stage prospects that develop into successful growth companies.

MPS provides services in Corporate Advisory, Stockbroking, Investment Research and Education.


Barry Dawes
Martin Place Securities
T: +61-2-9222-9111


Martin Place Securities

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