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Those who are looking for value in today’s market certainly have all the task ahead. The market is, by most measures, sparkling, to put it mildly. However, there are some pockets of value (like this Canadian gold miner) that in my opinion offer tremendous value today.
The gold miner I’m talking about is Gold Equinox (TSX: EQX) (NYSE: EQX). This mid-cap gold mining game is an area that many investors may not have heard of. However, there is a lot to like about what this company has to offer.
Let’s see why Equinox Gold might be a stock investors want to add to their watchlists right now.
Equinox relies on its new gold project in Ontario
In October 2020, Equinox Gold began construction on its new Greenstone gold mine. This project will be a key driver of economic growth and will provide 2,000 jobs during the construction phase. Once it is operational in 2024, there will be another 500 positions.
While Equinox owns 60% of the mine, Orion Mine Finance Group owns the rest. The Greenstone mine will have an annual production capacity of 400,000 ounces over 14 years, making it the fourth largest gold mine in Canada. Once production begins at Greenstone, Equinox will be able to produce approximately one million ounces of precious metal each year.
Indeed, for any gold miner in the world, that is a significant number. Additionally, Equinox’s geographic positioning in some of the least risky jurisdictions in the world should be noted.
Equinox’s growth profile is attractive to investors
Investors should be careful not to ignore Equinox Gold’s global presence. Indeed, the assets of these companies are spread over sites benefiting from favorable mining jurisdictions. These locations include Brazil, United States, Mexico, Canada, and more. Having said that, the main focus of this company over the past few years has been the US market.
Gold production is a global game and Equinox is looking to become a bigger and growing player in this space. Currently, the company has seven mines currently in production. In addition, the company has four projects under development. However, among mid-cap gold producers, Equinox has one of the largest (if not the largest) gold reserves of its peers. It stands out, especially for those who are bullish about the direction the price of gold is going.
Considering Equinox’s ability to ramp up production over time, there’s a lot to like about how this gold miner is positioned right now.
At the end of the line
Gold mining is a difficult business to manage. It is an oligopoly and a sector that has been consolidating for some time. However, I think there is still room for mid cap players like Equinox to deliver huge value.
Indeed, among mid-cap gold miners, Equinox tops my list. Long-term investors should at least take a look at this business.