NEW YORK ( TheStreet) -- The uncertainty regarding whether or not the U.S. economy will fall off the fiscal cliff should be giving Comex gold a bid, but instead, the precious metal has been moving sideways to down since trading as high as $1,798.1 on Oct. 5 and as low as $1,672.5 on Nov. 5. This price action still has gold above its 200-day simple moving average at $1663.4.
When prospecting for gold mining stocks using www.ValuEngine.com I found seven that have "four-engine" buy ratings. All seven are undervalued by 18.4% to 45.2%. One has a gain of 41.1% over the last 12 months, while the other six are lower by 16.0% to 28.8%. By comparison Comex gold is up 6.9% over the last 12 months. Three of seven gold miners have single-digit 12 month trailing price-to-earnings ratios, three have reasonable P/E, while one has an elevated P/E.
Fundamentally ValuEngine shows the basic industries sector just 3.2% undervalued with the gold mining industry 10.5% undervalued, which is a reason to consider gold shares over Comex gold. The last time I made this type of comparison was on Sept. 10 when I wrote
With the gold mining industry undervalued and with most gold mining shares lagging gold significantly, investors considering buying gold should prospect among the gold miners I profiled today.