Gold With A 5% Dividend - Gold Mining Stock Lundin Gold | Summary and Q&A

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June 8, 2022
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Value Investing with Sven Carlin, Ph.D.
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Gold With A 5% Dividend - Gold Mining Stock Lundin Gold

TL;DR

Landing Gold, a gold mining stock, presents a compelling investment opportunity due to its low production costs, potential for cash flow growth, and high dividend yield.

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Questions & Answers

Q: Why is gold considered a counter to the quantity of money in the system?

Gold is considered a counter to the quantity of money in the system because it is seen as a hedge against inflation and currency devaluation. As the supply of money increases, the value of gold tends to rise.

Q: What are the key advantages of investing in gold miners over gold itself?

Investing in gold miners offers the advantages of potential dividend income, earnings growth, and leverage to gold prices. Gold miners can provide higher returns if gold prices increase, but they can also be more volatile.

Q: What are the main risks associated with investing in Landing Gold?

The main risks associated with investing in Landing Gold include fluctuations in gold prices, geopolitical risks in Ecuador, and operational risks in mining. Any significant drop in gold prices could impact the company's cash flows and profitability.

Q: How does Landing Gold's production costs compare to other gold miners in the industry?

Landing Gold has low production costs, with all-in sustaining costs of around $700 per ounce. This places them on the lower end of the cost curve, reducing the company's risk and increasing its profit potential.

Summary & Key Takeaways

  • Landing Gold stock has doubled as gold prices have surged, making it a potentially profitable investment.

  • The company owns one mine in Ecuador, Fruta del Norte, which is currently in production and has a 13-year life of mine.

  • Landing Gold has low production costs and a strong cash flow potential, offering a 14% free cash flow yield and a 5% dividend yield.

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