History Says Gold Wins When This Signal Flashes — and It’s Flashing Now
Every time the Buffett Indicator has hit extreme levels, stocks have crashed — and gold has dominated the decade that followed. Today, the Buffett Indicator is at its highest reading in history… and Buffett himself is sitting on an unprecedented $325 billion cash pile. Sources say he’s preparing to deploy it — not into stocks, but into gold. Find out which gold company Buffett is likely to back.
Something interesting and informative happened today regarding five different companies I’m covering in my paid portfolios. It’s something that I think can help any investor outperform… and while it’s simple, it’s something that most investors just can’t be bothered to do with any consistency.
It’s earnings season, which means the bulk of the companies I cover are reporting their financial results for the quarter ending on June 30th.
As you might expect, most of the companies in my portfolios are reporting strong financials. Many of them have posted record profits, cash flow, gold/silver production. Some are hitting record highs at just about every metric, including cash in the bank, dividend raises, etc.
That’s what happens to well-run companies when the price of their underlying asset rises in price: they can ramp up production to take advantage and fatten their margins.
I sent out a member news alert about five of these companies that reported earnings early today. Only one company had a relatively flat quarter, but it’s still moving in the right direction.
However, four of these companies were down today – not by much considering the run that most gold companies have had over the past few quarters. One of them was up 14% for the day…
But if you only looked at the price action of these five companies, you might be under the illusion that four of them had somehow done poorly or posted a lackluster quarter. Maybe if you weren’t aware it was earnings, you would assume something bad had happened.
As I wrote this morning:
“I know these results can be a little tedious to read through, but I’m compressing them down to the bare essentials – and if you own any of these companies or are thinking about owning them, you really should be acquainting yourself with what they’re up to. Earnings season is only a few weeks, and it’s worth your time.
Despite these companies reporting solid financials, it's a bit of a mixed bag.
If you only looked at the stock price performance instead of the actual financials, you might come to a different conclusion. That's why it's important to pay attention to the details, not just the price action.
Remember, educated and informed investors tend to outperform over the long term.“
It’s tempting to try to form a hypothesis about why a company that just posted record profits and revenues would be down 2%. You can drive yourself crazy coming up with theories or narratives that fit reality – and at a certain point, it doesn’t matter if you’re right or not.
Short term price movement that runs counter to your assumptions is of course frustrating, but it’s a very natural part of any market. Sometimes the market rewards bad news, punishes good news or ignores either. Sometimes it’s as simple as people selling into good news in order to take advantage of volume they wouldn’t normally have.
At a certain point, if you’re a long term investor in a specific company, this kind of price action is irrelevant. You’re not owning these companies because you expected them to go up 2% instead of down 2% on any given day.
You (hopefully) own them because you see their long term value and understand that at current prices, they’re still priced well under your target price.
Being a long term investor means having the patience to do nothing when the market moves against you. It means looking far ahead at the horizon – to where prices are likely to be in the coming months and years. It means waiting for the market to see the same value that you do.
Right now in my portfolios, using conservative metrics, almost every company I’m covering is still significantly under my target price. As gold moves higher (or lower) I will adjust my target price, but I don’t know of any thesis that puts gold lower in price any time soon.
I’ve already had to adjust my target prices a few times for some of my favorite companies, as their margins have improved along with the upward move in the price of gold and silver.
I also know that after the run-up we saw in the first 6 months of 2025, we’ve kind of hit a little bit of a slowdown. It can feel disappointing when the rollercoaster ride seems like it’s slowing down. But we’re in this for the long haul, and it won’t be long before the market starts to see the value in high quality gold stocks.
Until then, we have a little bit of a reprieve to adjust our portfolios and put more money to work.
It’s a good time for us, because the gold market just underwent a 15 year period of pain and heartache – and even institutional investors and gold majors are still gun shy. It means the value is building…
Stay tuned.
Best,
Garrett Goggin, CFA, CMT
Lead Analyst and Founder, Golden Portfolio
P.S. If you’d like to speak with someone directly regarding the four different paid services we offer at Golden Portfolio, you’re welcome to call Spencer toll-free at 1-833-780-3479, Monday – Friday, 9 a.m. – 5 p.m. ET. He’s based right here in the U.S.—sunny Florida, to be exact—and happy to help. Please keep in mind, we cannot give personalized investment advice.
You can also reach him by email at [email protected].