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If you're still kicking yourself over missing the rush into gold stocks, relax: Despite seeing record highs, Martin Roberge, portfolio strategist and quantitative analyst at Dundee Securities, believes that there is still plenty more upside left in these precious metals equities.

"The exponential phase of price appreciation has begun and is well supported by relative earnings strength, positive reflation forces and reasonable valuation," he said in a note. Or, to put it another way (as he does), it is "time to go for the bubble."

The way he sees it, there are three good reasons to believe that there are plenty more gains ahead, even with the price of gold firmly above $1400 (U.S.) an ounce. He pointed out that unlike previous bull markets in gold, this time earnings support stock prices – thanks in part to the end of hedging strategies, where gold companies would sometimes lock in lower gold prices.

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"The net result is that forward [earnings per share] estimates for senior golds such as Barrick Gold Corp., Goldcorp Inc., and Agnico-Eagle Mines Ltd. exhibit relative strength vs. market earnings," he said. "Already at new all-time highs, this earnings ratio is likely to get much higher following the poor bank earnings results in Canada."

On reflation, he noted that previous bull markets in 1994 and 2004 peaked when the Federal Reserve began to hike interest rates – but such an event seems like a long way off, given the Fed's eagerness to continue stimulating the weak economic recovery.

And finally, equity valuations for senior gold producers still looks reasonable. During the 1994 bull market, gold producers peaked at 6-times book value, and in 2004 they peaked at 3.4-times book value. Now, however, the S&P/TSX gold index trades at just 2.8-times book value, and has risen just 12 per cent this year.

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