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« Record Dollar Demand for Gold! | Main | Gold at $600.00? »

Yamana gold Incorporated: Explanation of Current Performance!

Yamana logo 24sep07

Gold producing stocks are well and truly in the dog box with Yamana Gold Incorporated suffering more than most, so we contacted Yamana regarding their performance and they replied this morning. Their reply is printed here in full, exactly as we received it.

Thank you for your interest in Yamana Gold. We encourage looking at stock performance on a relative basis. When comparing our performance with that of our peers, it is clear that there has been significant pressure across the board. Stock performance is a reaction to the recent state of the market; gold equities have been trading quite closely to the markets, and less closely to the commodity. Having said that, Yamana has been sold off slightly more than most and we are just as frustrated as you are, as we are shareholders as well. A possible reason for this may be the effect of the large transaction we completed last year. Some have a view that it takes one year for full integration of operations and people, and though we don’t agree, as we have fully integrated already, this may have an effect. We have also heard that the transaction resulted in more hedge funds and momentum players holding our stock. With current market conditions, hedge funds are liquidating their positions, which impacts Yamana’s share price.

We remain committed to delivering value to our shareholders. Yamana continues to be one of the lowest cash cost companies in the industry and we are uniquely positioned with a declining cost structure and increasing production all in gold. We have the stability of the jurisdictions in which we mine. Most of our 2009 and 2010 production estimates are based on mines that are or will be built by the end of this year. We are well positioned with cash, cash equivalents, and growth both in production and cash flow, and other valuable assets. We have many upcoming positive events expected for the end of this year and we are currently on track to deliver on these milestones.

We hope this answers your questions.

Best Regards,
Investor Relations
Yamana Gold Inc.

Yamana Gold has a market capitalisation of $2.52 billion, a P/E ratio of 8.26, with 699.21 shares outstanding and closed yesterday at $3.60.

Yamana Gold Incorporated trades as AUY on the New York Stock Exchange and as YRI on Toronto Stock Exchange and as YAU on the London Stock Exchange.

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Reader Comments (6)

Stability underway. Just as planned.

Just look at that rally today people. 80 cents already.
Gary must be cheering up by now.


November 21, 2008 | Unregistered Commenterde Graaf

I'd like to thank you for inquiring. They know what they're doing, I've always liked them and their response doesn't disappoint. Right now their the only equity I'm invested in after losing a ton in other stocks throughout the year. I may buy more if their price goes lower (wish I did yesterday).

November 21, 2008 | Unregistered CommenterSteevo

Up 17.23% today, must bring a smile to someone's face!

November 24, 2008 | Unregistered CommenterGold Prices

And...Down 15 percent (TSE intraday), must make you cry instantly!

Keep up good hopes, and I am looking forward to the COMEX default, or whatever there is true about delivery problems.

Gold is down 40 dollars today with a stronger dollar, the confimation of a US recession since december 2007 (which was clear if you look between the US gov. manipulated numbers to other economic indicators like Copper) ;) (bells ringin')

Last Friday was good for me, I 'bailed out' of CitiGroup with 70 percent profits, and look at today. C-rashhhh after Rubin's bad performance.

Where is gold as a hedge against inflation? I still give blame to all the ETF's that are propping up and selling off golds value. Where is the fundamental selling spree coming from?

I'm biased.

December 1, 2008 | Unregistered Commenterde Graaf

Hard to accept but nonetheless news of today;

Credit Suisse cut price targets on numerous gold stocks this morning:

Yamana Gold (NYSE: AUY) from $12 to $6.50
Eldorado Gold (AMEX: EGO) from $8.50 to $7
Gammon Gold (NYSE: GRS) from $5.50 to $3.25
Barrick Gold (NYSE: ABX) from $52 to $35
Goldcorp (NYSE: GG) from $46 to $35

"Credit Suisse downgrades AUY to Neutral from Outperform and lowers their tgt to $6.50 from $12 saying despite the fact that it is the only million ounce producer in their coverage universe trading at mid-tier levels, there are a number of issues with this company in the near term that they believe will weigh on the share price. The firm believes that despite the cut to the production forecasts in October, the ramp up to the revised level of production in 2008 and 2009 will likely be slower than expected, for which they believe the market has little patience at this stage."


December 8, 2008 | Unregistered Commenterde Graaf

Credit Suisse had a point after all. See the Reuters reporting below;

A 2.85 percent dilution of shareholder wealth or 16.7M shares added with an option of another 2.5M.

December 10, 2008 | Unregistered Commenterde Graaf

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