Cramer's New Favorite Gold Stock
While gold may be a luxury for consumers, Cramer said Wednesday, it’s a necessity for investors. It’s never a question of if gold should be owned, it’s a matter of how to own it. That’s why he’s always telling Mad Money viewers that their portfolios should have at least one related stock. Cramer’s favorite play right now? Agnico-Eagle Mines.
Agnico looks ready to benefit from some great historical trends in gold, Cramer said. The precious metal tends to perform well in the third and fourth quarters, with the price for the latter six months up an average of 8% over the last 11 years. In the last four out of six years, the increase has registered in double-digit percentages. Gold, meaning the actual metal, has often outperformed its sector’s stocks, but Cramer said that’s about to change.
Agnico-Eagle has poured huge sums of money into expanding its operations in order to produce more gold. Now that the strategy is starting to pay off, the company is planning to pay out large dividends to shareholders. That's one thing that gold bullion doesn’t offer. The stock is up 17% since Cramer's April 29 call, and after reporting a strong second quarter on Wednesday he thinks AEM is worth another look.
CEO Sean Boyd appeared on Mad Money to give viewers the latest on his company. So watch the video for Cramer’s full interview.
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