2024-02-18 23:25:12 ET
Summary
- VanEck Gold Miners ETF is trading at multi-year lows relative to gold, but this merely reflects the ongoing deterioration in the sector's fundamentals.
- Declining profits and free cash flows, along with deteriorating balance sheets, are contributing to the sector's challenges, with dividends set to be slashed.
- Weak fundamentals leave gold miners highly susceptible to falling gold prices, with previous cash crunches resulting in the GDX trading below book value, which is still 30% below current valuations.
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GDX: More Pain In Store For Beaten Down Gold Miners