With
Gold Resources Corporation, a seriously out of favour gold mining stock that is listed on the New York Stock Exchange and operates in Mexico.
Why / how did I find this one? Well, I started tracking it a few months ago having spotted it has a strong dividend orientation (particularly for a gold miner). If it can maintain its current 3c a month payout that puts it on a 5% yield (pretty impressive for a gold miner, which actually produces a lot of silver - about 100 times as much by weight according to the quarterly release on 8th May).
Year to date it has lost 54% of it's value and cut its dividend in half - but it has a reputation to maintain as a monthly dividend payer so it's likely management will be doing all they can to keep the dividends flowing.
It owns six properties in the Oaxaca state in Mexico, of which five are exploratory and one is operating as a mine. A key metric for gold miners (especially with the recent drop in the price of gold) is the cost to produce each ounce. In Gold Resource Corporation's case the total AuEq cost (gold equivalent cost - Au is the atomic symbol) was
reported as $515 in May. Compare that to
today's spot price for gold, $1,287.80. What was also interesting in the May release was that the company has paid down all its debt.
So, to go over that again:
- The company has no debt
- It produces gold at less than 40% of the market price
- It has paid a dividend every month for the last 36
- It's yielding 5%
- Its share price is down 54% this year
A pretty compelling selection if you ask me.
