Movers and SHAKERS
Thoughts Heading into the 2020 Precious Metals Summit
In 2019, nearly 1,100 persons attended the annual Precious Metals Summit at the Beaver Creek Resort in Colorado. Over 180 companies and 262 buy-side firms were also represented. This year the conference will be virtual, and indications are attendance and participation may surpass last year’s. Noble Capital Markets will be represented at the Summit by Senior Mining Analyst Mark Reichman, along with the expected increased attendance. The summit provides an opportunity to meet with management teams in one-on-one settings and includes programs featuring panel discussions, interviews, and presentations. While the conference name is a bit of a misnomer since companies in attendance include producers of predominantly base metals as well, it is considered a premier venue for identifying up-and-coming junior mining companies, encompassing explorers, developers, and producers.
A Brief Look at Mining Stock Performance and Metals Prices
Year-to-date through September 11, the VanEck Vectors Gold Miners (GDX) and Junior Gold Miners (GDXJ) were up 40.6% and 37.6%, respectively. More broadly, mining companies, as measured by the XME, are down 18.2% compared to price appreciation of 3.4% for the broader market as measured by the S&P 500 index. Gold and silver futures prices increased 25.6% and 48.5%, respectively. With respect to base metals, copper and zinc futures prices increased 8.0% and 6.9%, respectively, while lead futures prices declined by 1.7%. Precious metals investors who left the conference last year with some promising investment ideas, along with conviction that gold and silver prices were headed higher, likely found the event worthwhile.
Key Topics for This Year
While the political and macroeconomic environment will be on investors’ minds as they influence metals prices, discussions with management will likely focus on company-specific value drivers and risks. Given the strength in gold and silver prices and corporate valuations, attention may focus on M&A and, for producers, free cash flow generation and uses of cash. The recent resignation of Rio Tinto’s Chief Executive Officer following the company’s destruction of a 46,000-year-old sacred Aboriginal site in Australia might also elicit more conversations around social license and other environmental, social, and governance topics. Beyond the usual interest in M&A, the conference may draw new investors that are interested in secular themes, including electrification and the pivot away from fossil fuels to renewables. Therefore, producers of metals, including copper, nickel, palladium, and silver, that are critical to battery and clean energy technologies are likely to be popular.
Due to growing interest in metals critical to battery and renewable energy technologies, the conference organizers may want to consider rebranding the conference to draw and better reflect a broader range of participants. In the past, The Precious Metals Summit was geared more toward junior mining companies with an emphasis on explorers and developers, while the Gold Forum Americas, generally held immediately after in Denver, was perceived as the venue for larger precious metals mining companies. In recent years, there has been some overlap. Rebranding the Precious Metals Summit to encompass more than just precious metals, i.e., Precious Metals and More, could be a way to draw a sharper distinction between the two conferences.
While industry-specific conferences are helpful for investors, ChannelChek is positioned as a broader resource for micro and small-cap investors. Along with independent company and industry research, ChannelChek’s product suite includes C-Suite video interviews, virtual roadshows, timely articles, and company-specific data sets, all at no cost to the subscriber. While many of the mining companies covered by Noble Capital Markets will be attending the Precious Metals Summit, investors can find more information about them on Channelchek in addition to our analyst’s latest insights.
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2020 Precious Metals Summit Beaver Creek (Virtual), Event Home Page, Precious Metals Summit Conferences, LLC, 2020.
A Mining Company Blew Up A 46,000-Year-Old Aboriginal Site. Its CEO is Resigning, NPR, Merrit Kennedy, September 11, 2020.
Denver Gold Group Presents The 32nd Annual Gold Forum Americas / XPL-DEV 2020, Home Page, Gold Forum Americas, 2020.