uploads///south african miners

Analyzing the South-African Mining Companies

By

Jan. 7 2016, Updated 7:05 p.m. ET

Miners rout

The current rout in precious metal prices has extended to the mining sector. The fall in gold and silver of 10.6% and 12.1%, respectively, has made the mining sector anemic, as seen in the VanEck Vectors Gold Miners ETF (GDX). GDX fell a whopping 25.7% in 2015. Most of the mining companies that are components of GDX fell hard in 2015. The VanEck Vectors Junior Gold Miners ETF (GDXJ) also took a steep fall of 19.9% in 2015.

Let’s concentrate now on the performance of South African mining companies in 2015.

Article continues below advertisement

South African miners

Major South African mining companies such as Sibanye Gold (SBGL), Gold Fields (GFI), and AngloGold Ashanti (AU) have fallen 20%, 391%, and 192%, respectively, so far in 2015. The fall was most likely due to the sharp fall in the prices of precious metals that these companies mine.

All three companies are trading at a significant discount from their next 12-month target price. The coming year may bring a ray of hope for these miners. Even though these three stocks are trading above their 20-day moving averages, a possible rebound in prices could be expected as 2016 sets in.

100-day moving average

Sibanye Gold and Gold Fields are trading at a premium of 9.3% and 1.5%, respectively, from their 100-day moving averages. AngloGold Ashanti is trading at a discount of 7.7% from its 100-day moving average. This could suggest that AngloGold may have a faster rebound in prices compared to the other two companies. GDX and GDXJ are trading at a discount of 4.7% and 4.8%, respectively, from their 100-day moving averages.

Advertisement

More From Market Realist

  • Open sign on a sidewalk
    Macroeconomic Analysis
    Top Reopening Stocks to Play the Shifting Market Sentiment
  • Morgan Stanley sign and stock numbers
    Macroeconomic Analysis
    Morgan Stanley's Buyback Stock Picks in 2021
  • Black Wall Street sign is sign of ethical investing
    Macroeconomic Analysis
    Ethical Investing Stocks and Funds for Your 2021 Portfolio
  • New York City skyline and Goldman Sachs logo
    Macroeconomic Analysis
    Goldman Sachs: Options Trade Picks to Play Earnings Season Volatility
  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.