Beadell regains glitter

Fledging gold producer Beadell Resources (BDR) is the best performing stock on the Uncapped 100 today after the spot gold price recovered in overnight trade.

The stock jumped 4.4% to a three-day high of 70.5 cents even as the broader market was trading more than 0.5% in the red in afternoon trade.

Beadell is one of the most attractive gold equity stocks on our market given that its cost of production is one of the lowest in the world at around $US600-$US700 an ounce, as highlighted in our article yesterday.

But its share price performance is still very much determined by the volatile spot gold price, and while the precious metal is still holding above the psychologically important $US1200 an ounce level, it needs to climb to above $US1350 per once in the near-term if it is to draw in fresh support. Otherwise, there is a real risk that an ounce of gold will fall to $US1000.

This is why investors shouldn’t think that the worst is over for Beadell. It feels like the stock takes one step forward and two steps back as the market remains unconvinced that the gold price has stabilised.

Beadell aims to become a 200,000 ounces of gold producer in 2014.

Click to enlarge