While there are many investors who bought gold 12 months ago and are happily cashing in, having made a profit of around 60 percent, those who acquired OceanaGold Philippines (OGP) shares also one year ago have made a gain of at least 100 percent.
Let us repeat that: Gold investors got around 60 percent gain over the past 12 months, while OGP investors got an investment return of at least 100 percent. Gold’s price is currently hovering around $4,300 per ounce.
And perhaps a lesson can be learned here: That there are certain stocks listed at the Philippine Stock Exchange (PSE) that can go the opposite direction, or go up dramatically even as the PSE index (PSEi) and blue chip stocks decline.
Also, buying shares of companies with gold mining as their core business may be better than buying gold itself, and in this case, OGP shares listed at the PSE performed better than gold itself.
Shares of stocks are also easier to acquire and sell compared to gold, as investors need to find buyers that may sometimes invite criminal elements.
The price of gold is up by around 60 percent in the past 12 months. FROM GOLDPRICE WEBSITE
DEFYING THE PSEI
Since the start of this year, the PSEi has failed to get past the 6,600-point level. Also, the prices of leading stocks, particularly some industry leaders, have gone down.
For example, the shares of BDO Unibank is down to below P140 from around P165 twelve months ago, reflecting a 15-percent drop, despite the bank registering the highest profits in the industry.
Another example is San Miguel Corporation (SMC), that registered a 9-percent increase in its January-June income to P36.7 billion. SMC’s share price is currently hovering below P61, while its price was around P88 a year ago.
OCEANAGOLD SHARES LEAP BY ALMOST 100 PERCENT
As for OGP, it’s net income for the January-June period dropped by 14 percent to $22 million, although its revenues rose by 9 percent to$175.5 million, attributable to higher average gold prices.
However, the price of OGP shares over the past 12 months leaped by almost 100 percent over the past 12 months, or from P16 to above P30. When OGP shares listed in May 2024 at the PSE, the initial price was P13.33.
One thing is clear from the rise of OGP shares in the past 12 months: The rise in gold’s price by around 60 percent in the past 12 months, fueled by uncertainty in the US financial markets, and the central banks buying the commodity to bolster their monetary reserves.
The lesson from the huge price of the share price of OGP is simple: Keeping track of industry trends can make investors make huge gains from equities.
Here is also a bonus tip – the price of gold is expected to reach nearly $5,000 per ounce by the end of next year.
And who are the happier investors laughing their way to the bank? Gold buyers or OGP investors? The answer is obvious.
IMAGE FROM MARKETWATCH WEBSITE