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Investors already know that gold is a very interesting market when the tide gets tough. As they turn to derivatives such as futures and CFDs, buying shares of companies in the sector is an option worth weighing.
In times of recession or economic crisis, investors tend to take money out of the stock market and take refuge in safe-haven assets such as the precious metal.
During the economic crisis caused by the coronavirus pandemic, the price reached an all-time high of over $2,000 per ounce in August 2020, surpassing its previous record from 2011.
Here are some gold stocks that are also very attractive, ones that could yield more earnings than investing in gold itself, according to a MarketBeat report.
Barrick Gold Corp
The Canadian giant expects to produce nearly 4.5 million ounces every year through 2030. After recently thrashing earnings expectations and setting a $1 billion stock buyback, Barrick raised its dividend from 9 to 10 cents.
The company’s net earnings hit $726 million —41 cents a share— from $685 million or —39 cents— year-on-year. Revenue jumped about 1% to $3.31 billion, beating estimates for $3.2 billion.
CEO John Thornton said, “After careful consideration of our capital allocation, the Board has settled on a new dividend policy of a base dividend with an additional performance dividend linked to the net cash on the balance sheet starting in 2022.”
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VanEck Gold Miners ETF
An ETF is one of the best ways to diversify at fewer costs, among them the VanEck Vectors Gold Miners ETF. It offers access to some of the juiciest gold stocks in the market with less than $45 a share as of March 29, 2022.
VanEck’s ETF holds positions in the likes of Newmont Corporation, Barrick Gold, Franco Nevada Corp, Agnico Eagle Mines Ltd, and Gold Fields Limited
With an expense ratio of 0.5%, the ETF recovered from a low of $29 to $40, and estimates are pinning much hope on $45 by the end of the year.
One of the biggest gold companies in the business, Newmont’s dividend yield hit 2.82% declaring $0.55 per share of common stock for the fourth quarter of 2021 —payable on March 24 this year.
The firm also smashed earnings estimates with Q4 2021 EPS of 78 cents, and revenue coming in at $3.39 billion surpassing expectations by $13.58 million.
Jefferies analyst Christopher LaFemina also raised the firm’s target on NEM from $67 to $72, while Bank of America Corp also raised its price target from $70 to $75 with a “buy” rating.
The gold producer operates three big mines, Mali, Namibia, and the Philippines, and has a dividend yield of 3.5%. Last year, the company produced almost one million ounces of gold at an all-in cost of $888 —one of the industry’s lowest, which makes it an attractive option.
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In 2022, the company is expected to produce between 990,000 to 1.05 million ounces at an all-in cost of production ranging from $1,010 and $1,050 an ounce.
This year’s Q1 earnings report said that the Company's total gold production for 2021 was an annual record of 1,047,414 ounces, near the upper-end of its revised guidance range of between 1,015,000 – 1,055,000 ounces, and exceeding the upper end of its original guidance range.
Gold Fields Limited
Gold Fields Limited has resources in several regions such as South Africa, Ghana, West Africa, Australia, and Peru. The company has an annual gold production of 2.2 million ounces, attributable gold-equivalent mineral reserves of 52.1 Moz, and mineral resources of 116 Moz, according to its website.
Last year, dividend yield hit 2.7% and revenue grew by about 8% to $4.2 billion from $3.9 billion. It also saw net income of $789 million —a 9% increase year-on-year.
Further, JPMorgan Chase & Co analysts raised the price target from $13.80 to $15.50 and slapped an “overweight” rating on the company. Also, according to Tip Ranks, RBC Capital has a buy rating on the stock, with a target of $12.
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