Portfolio No 8.
Kirkland Lake Gold (KL) is my hedge against the incoming “flock of black swans” – see my summer update newsletter. The Toronto-based company is the gold miner with high value, low cost mines in these safe economies of Canada and Australia. No debt, record results for Q1, espected EPS growth of 80% in Q2. It is the lead recommendation of hte IBD Top 50, has a P/E of 21 and a ROE of 15%. KL is generating record free cash flow. It is doing all of this in a market where gold prices have remained relatively flat for years.
I started buying in early March ($29) as the Trump trade and foreign policies began to emerge. We have taken profits at 15% since then and built the holding now at $36.38 – an all-time high. I may add on weakness.
I forsee a calamatous Europe coupled with the trade policies of our administration as threatening our otherwise strong economy. This is my hedge. I have no other strongly favored individual miner and so have started to buy GDXJ – the ETF of potentially high-growth gold miners. GDXJ has done nothing for the last five years – it’s all time high was $166 in 2011.