Vinik also liked Cameco Corporation (NYSE:CCJ), buying 3.6 million shares of the $7.7 billion market cap uranium miner and power plant operator between July and September. The uranium market has been fairly cooperative over the last year, bringing the stock up about in line with the market and delivering a large increase last quarter compared to the third quarter of 2011. Revenue, however, was lower and we’d have to investigate that to try to get an idea of how the business will perform going forward. Cameco carries trailing and forward P/Es of 16 and 14, respectively, which would be a good price if the company can deliver modest growth rates on the bottom line.
Global gold miner Kinross Gold Corporation (NYSE:KGC) was another new gold stock in the portfolio. Kinross, like Barrick, is priced attractively in terms of analyst consensus for 2013 with a forward P/E of 9. It actually managed to increase its revenue and earnings in its most recent quarter compared to the same period in the previous year, though we wouldn’t be sure that it would continue to do so. Marty Whitman’s Third Avenue Management increased its own stake in Kinross by 30% last quarter (see more stocks Whitman was buying). As with Barrick, we don’t particularly like gold but think that the valuation is cheap enough to make it worth a look.
Vinik cut his stake in Agnico-Eagle Mines Limited (NYSE:AEM) in half, but still owned 1 million shares giving him a position worth over $50 million at the beginning of October. Agnico Eagle mines gold, copper, zinc, and lead. The stock is actually up 44% in the last year, and trades at 21 times forward earnings estimates. The $9.2 billion market cap company was one of First Eagle Investment Management’s ten largest holdings at the end of the quarter (find more of First Eagle’s favorite stocks). We don’t think that we would be interested in the company until we saw better earnings numbers.