2 Gold Mining Stocks That Are Not Appreciated By The Market

Gold has had a nice bounce since putting in a short term bottom at the end of 2011 after a $300 an ounce pullback. Given subsiding worries about China's growth as well as remaining concerns about fiat currencies and government debt, I feel confident gold is not going into a freefall anytime soon. Given that, investors might want to look at two reasonable priced gold mining stocks that are rapidly increasing earnings and revenues.

IAMGOLD Corporation (IAG) -

IAMGOLD Corporation, together with its subsidiaries, engages in the exploration, development, and production of mineral resource properties worldwide. It primarily explores for gold, silver, zinc, copper, niobium, diamonds, and other metals.

(Business description from Yahoo Finance)

4 reasons IAG is a solid value at under $16 a share:

· The median analysts' price target on IAG is $26 and Credit Suisse has an "outperform" rating and a $25 price target on IAG.

· It has a pristine balance sheet with over $1B in net cash ($2.86 a share) on the books. It also yields 1.5%.

· The company is rapidly increasing earnings. It made $.76 in FY2010 and should make $1.21 in FY2011. In addition, analysts currently have $1.46 a share projected for FY2012.

· The stock is selling at 10 times operating cash flow and is pegged to increase revenues north of 40% in FY2011.

Goldcorp Inc. (GG) -

Goldcorp Inc. engages in the acquisition, exploration, development, and operation of precious metal properties in Canada, the United States, Mexico, and Central and South America.

(Business description from Yahoo Finance)

4 reasons Goldcorp is a buy at under $45 a share:

· The company is significantly ramping up earnings. It earned $1.37 in FY2010 and should make $2.24 in FY2011 and expected to make $2.90 a share in FY2012.

· Credit Suisse has an "outperform" rating and a $63 price target on GG and the median analysts' price target on GG is $67.

· The stock looks like it has built a technical bottom at just under $44 (See chart).

click to enlarge

· The market is not currently pricing the company's growth potential correctly judging from its five year projected PEG of .43. Analysts also expect over 25% revenue growth in FY2012 after 40% plus growth in 2011.

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in GG over the next 72 hours.