Outlook on Gold and Gold Miners, Ryan McIntyre on CNBC

April 1, 2025 | (4 mins 6 secs)

Sprott's Ryan McIntyre is interviewed on CNBC's Fast Money about rising gold prices. McIntyre also addresses the surging demand for physical gold, the undervaluation of gold miners and whether Bitcoin poses a real threat to gold’s dominance.

Video Transcript

Melissa Lee: For more on what is next for gold, let's bring in Ryan McIntyre. He's a Senior Managing Partner at Sprott. Ryan, great to see you. You're seeing gold to $3,200.

Ryan McIntyre: We first see the resistance for gold at $3,200, and if we see it break beyond that, we see quite a bit of upside from there. It could be just the first step here, but we wouldn't be surprised if it bounced off $3,200 first.

Melissa Lee: How about the miners?

Ryan McIntyre: The miners are interesting. People have 100% gravitated towards physical gold. Still, there's been a lack of enthusiasm towards the mining stocks that mine gold, which is very interesting because typically, when gold hits record highs, you tend to see a lot of enthusiasm for the leverage plays on gold, like gold mining equities. You haven't seen that to the degree we have seen in the past, which is very interesting.

Guy Adami: We're at a point now where people are concerned about if they don't have it, they don't own it. Right. Possession is nine-tenths of the law; you had better have it in your vault, safe and domiciled in your country; PHYS works in that environment. I've been in the business a long time, and I don't think anybody's seen anything like this: the thirst, the need for the physical gold.

Ryan McIntyre: You're completely right. I think people have a visceral reaction to wanting something physical in this environment, which is more certain. If there's one trend we're seeing today, people want something in an asset that's independent from other asset classes but also independent from other institutions. It is something that stands alone, and physical gold does that where you don't have to depend on anyone for its outcome.

Melissa Lee: I hate to say that. This sounds like a strange question because there's no obvious ratio for gold, and it doesn't pay dividends — all these different things — no cash flow, etc. But at what point would you ever say that gold is in a bubble? Or is there no circumstance under which gold is a bubble?

Ryan McIntyre: At some price, for sure. You can't deny that price is a huge factor in investment returns. Since gold came off the gold standard in 1971, it's compounded annually at about 8%. We'd expect that to continue as the money supply continues to increase. There's very little marginal addition of gold in actual physical circulation year to year. That's very minimal. It's all about money being printed effectively.

Melissa Lee: You answered the question concerning the miners in a way because they eventually have to replace depleted assets, and eventually, inflation hits their costs. They have to deal with that. Is physical gold always the answer for you?

Ryan McIntyre: To me, it's the permanent answer. Typically, we think that's a strategic holding that people should have at about 10% level in a portfolio. We also believe miners can play a good role as well. Based on valuations and enthusiasm, we think anywhere from 0 to 5% for the miners. If people were excited about gold mining companies, they were raising a ton of money. Huge valuations skew that towards the zero side. People were benign and didn't care about them more towards the 5% side.

What's interesting about gold mining companies is that they get leverage to the gold price. With every 1% move in the gold price, we'd expect about a 2% change in profitability and, therefore, a share price move. The other part you get with additional gold price expansion is growth as well. That's growth in the reserve base, maybe growth through production expansions and so forth. That is organic within the firm as well.

Karen Finerman: Did you feel any threat to gold's position from Bitcoin in the last year or so?

Ryan McIntyre: We get asked that a lot, and I guess our view is that we never felt that, but we could feel other people feeling that. It's tough when Bitcoin is doing well versus gold, and people say that gold isn't the hedge it once was and all this type of thing.

Our view is that gold has the track record and the unique attribute of being physical, which Bitcoin does not have. It's hard or impossible to create gold out of thin air like you can with cryptocurrency. It's an asset class that stands on its own.