This Little-Known Gold Mining Stock Could Deliver Big Gains

GoGold Resources is a gold miner you might not have heard of, but the little-known stock has set the market on fire this year. Shares of GoGold Resources have shot up a whopping 156% this year thanks to the gold price rally.

But is there any more merit to the massive spike in GoGold shares? Or will it eventually lose momentum and continue to remain a penny stock? Let’s find out.

GoGold Is Small Right Now, but Is Raring to Go

GoGold Resources can be considered to be a junior gold miner. It delivered revenue of $6.4 million in the second quarter of 2019, selling 438,740 silver equivalent ounces and recording an average realized sales price of $14.55 an ounce.

GoGold also pointed out that it exited the quarter with no debt and a cash position of $9 million. These numbers make it clear that GoGold is still in its early stages of growth.

A closer look at the company’s recent exploration results indicates that the company might be on to something big. Earlier in September, GoGold announced that it has gained access to the underground mine at Los Ricos in Mexico, where the company is currently carrying out a 10,000-meter drilling program.

So far, GoGold has spent $1.2 million on exploration activities at the Los Ricos mine. More importantly, it has received access to some decent grades as the early results show.

The highest grade recorded by GoGold at one of its intersections is 7.66 grams per ton of gold, while at another intersection, the company recorded a grade of 4.13 grams per ton of gold.

These results show that GoGold could deliver impressive top and bottom-line growth once it begins commercial production at the Los Ricos mine.

Investors Will Need to Be Patient

GoGold’s stock price will be impacted by two factors in the future. The first is the price of precious metals such as gold and silver, which have proven to be a big tailwind for the company so far this year.

The price of gold is expected to move higher in the coming months. What’s more, the same can be said about the price of silver thanks to strong industrial demand and a supply deficit. So GoGold stock is sitting on some nice tailwinds already.

Notable progress at the Los Ricos mine is the second reason that could push GoGold stock higher. If the company keeps delivering positive updates on a frequent basis, more investors will be attracted to the stock.

As such, anyone looking for a development stage company that can get big in the long run and become a multi-bagger should keep a close eye on GoGold Resources.