Why McEwen Mining's Shares Popped

Before you go, we thought you'd like these...
Before you go close icon

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of McEwen Mining jumped as much as 12% today after the company released production figures.

So what: In the second quarter, the company produced 35,955 gold equivalent ounces, 30% higher than a year earlier. Both of the company's mines are producing at solid levels, and management thinks it can reach 130,000 gold equivalent ounces this year. 

Now what: The strong performance was good, and it didn't hurt that gold itself was up 2.9% today. The low price of gold has hurt miners, so they can use any good news they can get on the pricing front. McEwen hasn't yet posted a profit and, with gold under pressure, I would take a cautious approach to this stock, because even higher production may not make up for falling prices.

Gold has outshone the stock market overall with strong returns since 2000, but more recently, has given way to big declines, which has closed the gap with stocks. The Motley Fool's new free report, "The Best Way to Play Gold Right Now," dissects the recent volatility, and provides a guide for gold investing. Click here to read the full report today!

The article Why McEwen Mining's Shares Popped originally appeared on Fool.com.

Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

People are Reading