Yamana Gold Inc (AUY)

[golden08]

Cramer said he sees a bull market in gold, and taking a cue from Peter Marone, CEO of Yamana Gold (AUY - Cramer's Take - Stockpickr), a stock which he owns for his charitable trust, Action Alerts PLUS, says the commodity could reach $1600 per ounce.

Since Cramer first recommended Yamana Gold back on June 6, 2006, gold has risen 56%, while Yamana has risen over 100%.

But Cramer now recommends Agnico-Eagle Mines (AEM - Cramer's Take - Stockpickr) as the gold stock to own.

According to Cramer, Agnico is the second lowest cost producer of gold behind Yamana, and after interviewing the company's CEO last Friday, he says the company's story is just too good to pass up.

Cramer cited the American Stock Exchange's gold index as one measurement of how undervalued the gold stocks are. According to the index, the entire gold sector has only a $200 billion market cap, while a company like ExxonMobil (XOM - Cramer's Take - Stockpickr) is valued at more than $400 billion.

Cramer said the gold stocks as a whole should be valued at double their current levels.

"Very rarely do I mention a company two nights in a row," said Cramer, "But I believe so strongly in gold and Agnico that I just had to go more in-depth again tonight."

Strong Insider Buying