Pinnacle Silver & Gold Corp (TSXV: PINN)
Building a New Americas-Focused Silver and Gold Company
Gold’s push above $4,400 an ounce has finally translated into a sharp repricing of gold mining equities. The VanEck Gold Miners ETF (NYSE: GDX) is up 23% in August, on track for its best month since April 2020, and is trading near its highest level in more than a decade. That surge masks how long miners lagged the metal: GDX is up nearly 18% over the past month and 53% over the past year, but only about 3% year to date.
Two catalysts are driving the catch-up. First, gold above $4,400 directly boosts miner revenue. Second, crude oil has stayed largely between $70 and $85 a barrel, well below the March peak near $120. Diesel powers trucks, shovels and generators at most mine sites, so lower oil prices hold down per-ounce production costs.
VanEck portfolio manager Imaru Casanova argues investors overstate fuel risk. Energy is only about 15% to 20% of all-in sustaining costs, while labor accounts for 35% to 50%. Newmont, for example, based its 2026 plan on $70 Brent, and estimates a $10 move in oil prices shifts full-year costs by about $60 million, or roughly $11 per ounce. The same instability that pushes energy prices higher also sends investors into gold, so cost pressure and revenue support tend to arrive together. VanEck estimates second-quarter sector AISC came in below $2,000 an ounce, leaving operating margins near record highs.
Individual miners have also posted outsized gains. Through August 17, Aura Minerals is up 43%, Aya Gold & Silver 34%, Hecla Mining 33%, Agnico Eagle 30%, and Coeur Mining 30%.
GDX is concentrated: Newmont and Agnico Eagle together account for more than a quarter of the fund. In the second quarter, Newmont realized $4,414 per ounce with byproduct AISC of $1,621, producing record free cash flow of $2.2 billion. Agnico generated $1.3 billion in free cash flow with AISC of $1,459 per ounce. Strong results from the largest holdings feed directly into the ETF.
The path forward depends on gold holding above $4,300 and real yields staying subdued. Buybacks are also shrinking share counts. But a pullback in gold toward $4,000 with WTI above $95 would weaken the margin-expansion story. And with such concentrated holdings, a single disappointing cost report from Newmont or Agnico could drag the whole sector even if bullion holds.
