Saturday, April 24, 2010

Eldorado Gold, (NYSE:EGO) IAMGOLD (NYSE:IAG) and Gammon Gold (NYSE:GRS) Response to Gold Prices Rising

Just because gold prices are rising doesn't guarantee gold mining companies will rise significantly with them, and that's the case with gold miners like Eldorado Gold (TSE:ELD)(NYSE:EGO), IAMGOLD (NYSE:IAG) and Gammon Gold (NYSE:GRS).

Of the three gold mining companies mentioned above, Eldorado Gold performed the best when measured by the last 12 months or so, while the Gammon and IAMGOLD struggled more, with Gammon plunging in share price on operational problems.

Gold and silver production at their Ocampo project in Mexico was the major factor in that, gold production was down 23 percent and silver production was down 5 percent for the first quarter.

A board shake up at Gammon may help turn things around for the company, although that remains to be seen, and in the gold mining sector there are a lot better companies to invest in until that's proven.

The positive for Gammon is it's beaten down and cheap, and if they are able to turn things around, that could bring some good returns for investors, but that is a risky bet, even at the current price of the company.

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