Why Yamana Gold (AUY) Lost Its Luster on Monday

NEW YORK (TheStreet) -- Yamana Gold (AUY) was firmly in the red on Monday as gold miners suffered from an industry-wide selloff. Investors were fleeing the stocks after gold prices tumbled to their lowest levels since July.

The Canadian miner shed 5.5% to $8.59, adding to the company's year-to-date losses of 50.2%.

Gold prices were lower after November manufacturing data came in at the highest levels since mid-2011, sparking concerns the Federal Reserve would begin tapering monetary stimulus. By late afternoon, bullion was selling 2.3% lower to $1,219.71 an ounce.

Others affected included Barrick Gold (ABX), Silver Wheaton Corp (SLW) and Eldorado Gold (EGO).

Gold investments have become unfavorable over the year as low inflation created an adverse environment and investors shirked precious metals for more preferable equities. Year to date, the SPDR Gold Trust (GLD) has dropped 27.4% and the iShares Gold Trust (IAU) has fallen 27.3%, while the S&P 500 climbed 26.6%.

One investment firm still bullish on the company is Morgan Stanley, which reiterated an "overweight" rating and upped its price target to $12.50 from $11.50 last week.

"The company has been able to largely avoid the operating and capital costs inflation facing its peers," Morgan Stanley said in its report.

TheStreet Ratings team rates Yamana Gold as a Hold with a ratings score of C. The team has this to say about their recommendation:

"We rate Yamana Gold (AUY) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income."

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