Yamana Gold Inc. (USA) (AUY): Can This Company Survive Gold’s Plunge?

Yet one thing is certain: When gold prices drop, profits will drop with them. Yamana Gold Inc. (USA) (NYSE:AUY) may be the best positioned to handle price declines and still remain profitable, but investors need to prepare for earnings decreases if gold doesn’t bounce back quickly. Already, Newmont Mining Corp (NYSE:NEM) has cut its dividend based on the drop in gold prices and could make further cuts in the future if gold stays at current levels. Yamana has room to sustain its payout even if earnings decline, but a slump could put an end to its fast dividend growth in recent years.

In Yamana Gold Inc. (USA) (NYSE:AUY)’s report, watch for the latest progress update on the company’s Cerro Moro mine in Argentina. The South American nation has been a difficult one for mining companies to navigate because of its volatile political climate, but the mine has too much promise for investors to ignore.

The article Can Yamana Survive Gold’s Plunge? originally appeared on Fool.com and is written by Dan Caplinger.

Fool contributor Dan Caplinger and The Motley Fool have no position in any of the stocks mentioned.

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