Gold popularity as a significant investment is on the wane again. Even though gold as an investment still is not as lucrative as other choices on the stock market, there are gold investments that are worth considering.
Of course, as if any investments, you will have gold dealers promising great rewards on lower-priced gold stocks. Some of these gold stocks, such as Hecla Mining and Tahoe Resources are gold stocks that are not good investments at this time. Today, we look closer at these two mining companies.
This mining company in the past produced more gold than any other gold mining company here in the United States. Lucky Friday is Hecla Mining’s most massive mining operation. Unfortunately, this is their most troublesome gold and silver mining operation. Last year, in the early part of 2017 Lucky Friday started having substantial labor issues which are still prevalent today.
Before the labor strike last year, Lucky Friday reached tremendous gold and silver productions in 2016. Because of the massive decrease in production, Hecla Mining experienced a 26% decrease in the stock valve last year. Lucky Friday is one of four mines Hecla Mining owns. In addition to the problems with Lucky Friday, two more of the company mines production levels fell below standards two years ago. That leaves Hecla Mining with only one mine that is experiencing an operation that is having a successful production.
With Lucky Friday and the decreasing performance of two other mines the company owns, the company has seen a tremendous decrease in their profits and bottom line. With the labor strike still going on with Lucky Friday and no resolution in sight, Hecla Mining stock is best to avoid at this point.
Just this past April Tahoe Industries faced a labor strike. This labor strike involved the La Arena mines in Peru. Fortunately, this labor strike reached an agreement less than two weeks later. Unfortunately, political issues have escalated that has put the Escobal mine out of commission since the middle of 2017. Because of these problems, the company has suffered a 40% decrease in the stock valve this past year.
Tahoe Resources problems stem from the country’s government operative arm of mining regulations causing the total shutdown of Tahoe Resources’s two mines that they operate in Peru. With Tahoe Resources going from over 20 million ounces of precious metal production in 2016 to no production currently, this has caused a significant reduction in the company’s profits.
The Preu government will probably resolve these conflicting issues. However, Tahoe Resources still have several hurdles that they have to overcome. Tahoe Resources has other problems that could affect their performance to a healthy bottom line including increasing production costs, the cost of removing roadblocks to their mines in Preu, to name a few. In summary, Tahoe Resources will be too high a risk for the majority of investors.
As with any investment it pays to do your homework. Hopely this information has helped you in your selection of gold and precious metals stocks. The gold and silver market is seeing a revival. However, it always pays to be armed with the correct information.
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