The Investor's Digest of Canada features buy, sell and hold advice, plus earnings estimates, on more than 1,000 Canadian companies. The strongest recommendations this month are as follows:
Iran is rattling its sabers. Iraq is threatening to come apart at the seams. And our market mavens have taken a shine to gold.
It's perhaps understandable. After all, in times of upheaval and uncertainty, gold has always been a safe haven for investors.
Moreover, gold is on a tear, having zoomed from US$300 to more than US$560 an ounce in the past four years.
So our analysts' decision to put not one, but four goldplays on their list of top-10 buys this month, shouldn't come as much of a shocker.
In seventh spot - the same position it ranked last month - they've placed Eldorado Gold Corp. (TSX ELD, $5, 888-353-8166, www.eldoradogold.com), a Vancouver-based miner with operations in Brazil, Turkey and China.
Of the 14 analysts we surveyed, five rated the company a buy; three, a buy/hold and six, a hold.
In third place, our market watchers plunked down Barrick Gold Corp. (TSX ABX, $30.75, 800-720-7415, www.barrick.com), a true Canadian mining heavyweight.
Of 11 analysts we polled, six rated it a buy; four, a buy/hold and just one, a hold.
Barrick's popularity is easy to understand. With 90 million ounces in proven and probable reserves, along with a yearly output of five million ounces, the company is now the top gold producer in the world.
Indeed, thanks to its recent acquisition of rival Placer Dome, Barrick outranks such competitors as Newmont Mining and AngloGold Ashanti.
Moreover, Barrick's acquisition of Placer gives the company economies of scale. Because each company's assets were relatively close together, Barrick has pegged annual synergies at US$240 million.
Barrick can also take pride in its development record, having successfully built nine new mines around the world in the past decade alone.
Meanwhile, the company is raking in the cash, having posted fourth-quarter net income of US$175 million, or $0.32 a share - a year-over-year rise of 12.2 per cent.
Gold sales were also higher, zooming 54.9 per cent to $776 million, while operating cash flow more than doubled to $269 million, or $0.50 a share.
Barrick's year-end results were equally stellar, with net income climbing to $401 million, or $0.75 a share, from $248 million, or $0.46 a share, for the similar period in 2004.
Iamgold Corp. (TSX IMG, $9.98, 888-464-9999, www.iamgold.com) might just as well be called, "I am insignificant."
Not only did the Toronto-based mid-tier miner fail to make our-10 buy list last month, it also managed to get left off for the last year.
But our gold bugs have done penance. They've lofted IMG into second spot for March, knocking Canadian National Railway Co., long one of our leading buys, all the way down to sixth place.
Of the 14 market watchers we surveyed, eight rated Iamgold a buy; one, a buy/hold; four a hold and just one, a hold/sell.
And the company is doing well, having seen third-quarter net income rise more than three-and-a-half times to US$4.2 million, or $0.03 a share.
Revenue was also higher, climbing 11.4 per cent to $31.3 million, while earnings before income taxes jumped more than tenfold to $5.8 million.
With operations in West Africa and South America, Iamgold has partial ownership in four operating mines. It also continues to explore for gold in Argentina, Brazil, Ecuador and Senegal.
Toronto-based Agnico-Eagle Mines Ltd. (TSX AEM, $31.54, 888-822-6714, www.agnico-eagle.com) now produces gold at only one site.
But that location - the company's wholly owned LaRonde mine in Northern Quebec - is Canada's largest gold deposit, as well as one of the largest ever found.
Not only did it yield roughly 270,000 ounces in 2004, but it holds more than five million ounces of proven and probable reserves. In addition, as a by-product, it produces copper, zinc, and silver.
Moreover, Agnico-Eagle can lay claim to advanced-stage projects elsewhere in Canada, as well as in Mexico, Finland and the U.S.
All this may explain why Agnico ended up best in class this month. Of the 15 market watchers we surveyed, eight rated it a buy; three, a buy/hold; three, a hold and one, a hold/sell.
For the three months ended Dec. 31, the company's net income fell to US$11.7 million, or $0.13 a share, from $15.6 million, or $0.18 a share, for the similar period in 2004.
Source: Investor's Digest of Canada, 133 Richmond St., W, Toronto, ON M5H 3M8, 1 year, 24 issues, $137.
