The Rally In Gold Mining Companies: Barron’s (NG, SA,)

According to a Barron’s report, the little companies that explore gold have seen a tremendous rise in their returns. The stocks of these little gold exploration companies have rallied as gold prices have increased.

NovaGold Resources, Inc. (AMEX: NG), and Seabridge Gold, Inc. (AMEX: SA) are two such companies that have benefited from the rising gold prices. The two companies have seen their valuation increase ten times to $1 billion each.

However, the valuations for these companies have increased on back of the amount of gold hidden underground at their properties. If the estimated gold reserves at the properties of these companies are not proven, both the companies could experience a plummet in their share prices.