Gold Miners Are Printing Money
For most of the last 30 years, gold miners were the worst-run businesses in the market.
They diluted shareholders relentlessly. They overpaid for acquisitions at the top of every cycle. And they somehow managed to lose money even when gold was trading at record highs. Generalist investors learned to avoid the sector entirely. Frankly, they were right to do so.
That era is over. And now even Wall Street is admitting it.
Bank of America’s equity analysts just published a report stating that gold miners have become one of the most profitable sectors in the entire market. Consider the following:
Gold miner free cash flow is now 10 times what it was in 2020. Long-term debt as a percentage of equity has been cut in half. And miner earnings yields are now 12%, the highest of any sector in the market. Despite this, the group trades at its cheapest level “relative to the S&P 500 in the last 20 years.”
Read that again. The highest earnings yields in the market, trading at the largest discount to the S&P 500 in two decades.
How is this possible?
Because the investment world is still pricing gold miners as if it’s 2013. The market has not yet come to terms with the fact that these are now disciplined businesses generating truly staggering amounts of cash.
You can see this clearly in the chart below. It compares median profit margins for every S&P 500 sector against the top 20 largest precious and base metals mining companies. Financials and Technology, the supposed profit machines of our economy, come in at 17%. The mining industry comes in at 31%. That’s nearly double the margins of the most profitable sectors in the S&P 500.
What’s critical to note is that all of this is happening while Wall Street is cutting its gold forecasts. BofA recently lowered its average 2026 gold price target by 14% to $4,360 an ounce. So, these margins are not the product of some blow-off top in the gold price. They are what the industry produces at prices the banks themselves consider conservative. And even after the downgrade, BofA still sees a path for gold to reach $6,000 an ounce by 2027.
Let’s connect the dots here…
Gold miners are generating the fattest margins in the market at gold prices Wall Street considers “downgraded.” Miners are leveraged plays on the gold price: their costs are largely fixed, so every additional dollar in the price of gold drops almost straight to the bottom line. Which means if gold simply consolidates from here, miners keep minting money. And if gold makes its run toward $6,000, these margins don’t just hold… they explode higher.
Put simply, this is one of the most asymmetric setups in the market today. And generalist investors own almost none of it.
Again, the financial system is undergoing a tectonic shift away from paper assets and into hard assets. The re-rating of the companies that produce those hard assets hasn’t even begun. When it does, today’s prices will look like a gift.
In terms of profiting from this, we just published a Special Investment Report covering five investments you can use to profit from the next round of inflation.
The report is titled Survive the Inflationary Storm. It explains my top precious metals plays — their names, their ticker symbols, and the resources they own. These are high-octane positions that rallied 75%, 140%, 150%, 180%, 280%, and an incredible 574% in 2025. And I wouldn’t be surprised to see them repeat this performance in 2026.
Normally I’d charge $499 for this report as a standalone item, but in light of what is unfolding today, we are making just 100 copies available to the public.
To grab one of the last remaining copies…
Best Regards,
Graham Summers
Chief Market Strategist
Phoenix Capital Research