This article delves into the world of gold mining stocks, highlighting the top picks for 2024 and providing insights into how to make informed investment decisions in this dynamic sector. Every investment has advantages and disadvantages—gold stocks are no different. Because of the volatile nature of gold stocks, they are unlikely to be a good investment for novice investors or buy-and-hold investors. It’s recommended that investors interested in purchasing gold stocks do their own due diligence and consult with a financial advisor before making a decision. Do your due diligence, consult with a financial advisor and decide when the time is right for you to purchase gold stocks. Both physical gold and gold stocks have their own advantages and disadvantages.
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Gold stocks are shares of publicly-traded companies that are involved in gold production. Some gold stocks are miners; this group can be further divided into junior (upstart) miners and senior (established) miners. These firms don’t mine gold themselves but finance miners in exchange for a percentage of future production or revenue—offering lower operational risk and exposure to gold prices. Historically, gold has been viewed as a hedge against inflation, and the best gold stocks can offer similar protection—with the added upside (and risk) of company performance. The table below showcases some of the most actively traded gold stocks.
Gold mining companies that are consistently producing gold are known as senior miners. Some junior miners, like Alamos Gold (AGI), get multiple mines up and running and grow into senior miners. And in the case of AGI, that meant delivering triple-digit returns to shareholders. Others, like Pure Gold, run out of money and shut down before they start digging up gold consistently, leaving shareholders with nothing.
Geopolitical and Jurisdictional Risk
We rank the top 10 gold producers of the first six months of the year in kilo ounces (koz), tracking the percentage change from H1 2024. The Mining-Gold Industry has outperformed the sector over the past year but lagged the Zacks S&P 500 composite. The stocks in the industry have collectively grown 14.5% compared with the broader sector’s decline of 10.4%. It’s delivering real cash flows, owns critical infrastructure, and holds stakes in other major growth stories. Gold stocks could serve as a hedge to stocks you hold from other economic sectors.
Companies with quarterly EPS or revenue growth of more than 1,000% were excluded as outliers. These are the estimated quantities of gold that a company has a high degree of certainty it can economically and legally mine. “Proven” reserves are the most reliable, while “probable” reserves have slightly less certainty but are still highly likely to be extracted. When you invest in a gold mining company, you are essentially buying a share of these reserves.
Barrick Gold Corporation Business Overview
- These two mines alone should yield about 590,000 ounces of gold yearly, helping to boost total production.
- The universe of gold stocks includes gold mining companies, companies that finance gold mines and exchange-traded funds (ETFs) that invest in physical gold or other gold stocks.
- A gold mining company is an operating business with costs, liabilities, and a profit margin.
- Investors drove the stock price down after NEM missed third-quarter EPS expectations.
Some may be seeking higher returns ahead of expected cuts to cash rates later this year. The investment community is abuzz about gold, and for good reason. The price of the precious metal hit a high point in 2011, which it did not regain until 2020. After some volatility, gold was valued at about $1,650 per ounce in October 2022.
Industry Versus S&P 500 & Sector
You do want to hold gold alongside more conventional core holdings. For core investing ideas, see this list of the best stocks for 2024. Long-term followers of Kinross have watched the company go through some tough times. An expensive acquisition near the peak of the previous gold rally saddled Kinross with heavy debt. Kinross purchased Red Back Mining for more than US$7 billion in 2010.
- You can read more about our editorial guidelines and the investing methodology for the ratings below.
- Understanding the nuances of these stocks is crucial for any investor considering this investment avenue.
- One of the key potential disadvantages of an investment in a gold-mining stock is that most of these companies do not focus exclusively on gold.
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Don’t miss out—download 12 Stocks To Buy Now and claim your front-row seat to the coming boom. Newmont reported a GAAP net operating loss in fiscal year 2023 of -$3.2 billion. Key factors were non-recurring charges related to the acquisition of Newcrest plus noncash impairment and reclamation charges totaling $3.1 billion.
Mine production in Q2 reached a record 909 tonnes, contributing to a 3% year‑on‑year increase in total supply. Thus, Seabridge Gold’s strategic progress, financial backing, and project developments set it up as one of the best gold stocks to buy. Gold production fell 16% to 704,583 ounces, mainly due to mine closures and seismic activity. Furthermore, the Century zinc operations’ setbacks impacted the company’s bottom line. Despite these challenges, Sibanye Stillwater found success with its new Reldan recycling operation, which handled over 20 million pounds of mixed metal scrap and boosted overall performance. Gold has endured the test of time as a dependable store of value, and it continues as a hedge against economic uncertainty even in 2025.
A position in this fund rises and falls with gold prices only and there are no dividends. You won’t benefit from value creation by gold miners, but you don’t have to worry about the operational challenges either. Barrick Mining operates six of the planet’s top gold mines and has good gold and copper prospects under development. The Reko Diq copper and gold mining stocks gold mine being built in Pakistan, for example, is considered one of the largest undeveloped copper-gold sites on the planet. Barrick’s copper operations give investors decent metals diversification.
Strategic diversification mitigates risks, supported by prudent debt management and maintaining financial flexibility. Zacks Rank #1 Agnico Eagle Mines is focused on executing projects that are expected to provide additional growth in production and cash flows. The Kittila expansion promises cost savings, while acquisitions like Hope Bay and the merger with Kirkland Lake Gold strengthen AEM’s market position. The table below includes five promising gold stocks, plus two of the best ETFs for gold exposure.
DRD is involved in provision care and maintenance services; and operation of training center. Gold’s performance as an investment is highly dependent on economic conditions. However, gold’s long-term average annual return from 1971 to 2024 is 8%. Stuffing gold bars under your mattress is one way to invest in gold, but it’s not the most comfortable option. In addition, other investors seeking to benefit from the stock’s outperformance will often purchase it, further bidding its price higher. These are the stocks that had the highest total return over the past 12 months.
For 2025, Kinross is guiding slightly lower gold equivalent production and higher costs. If gold prices retreat dramatically, net earnings will disappoint. This means investors can get outsized returns from miners compared to direct gold investments—because miners’ profit margins can increase as gold prices rise. Franco-Nevada is a Canada-based gold-focused streaming and royalty company.
A gold ETF offers broad exposure to the sector by owning either shares of gold mining companies or physical gold. Because of the wide availability of gold ETFs, you don’t have to be a stock-picking guru to participate in the gold industry’s upside. That aside, one of the best ways to invest in the gold market is through gold mining companies. They benefit from rising gold prices, as well as their ability to increase production and reduce costs. Consequently, top gold mining companies can often outperform the price of gold. The top-tier gold miners have low cost structures, manageable debt levels, and limited exposure to risky mining projects.
Once you have decided on these factors, you can purchase the stock. Gold is a cyclical commodity, and companies in the industry also tend to generate cyclical results. Their profits rise when gold prices are high and decline when gold is cheap.