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Gold prices remained buoyant in early March, and that strength was reflected in some of the precious metal sector’s stocks.
Top-performing gold industry stocks for March include Lundin Gold Inc., Dundee Precious Metals Inc., and Yamana Gold Inc., whose share prices rose in the past year even as the VanEck Gold Miners ETF (GDX), a key sector benchmark, fell 21% and the Russell 1000 Index dropped by 9%.
Although gold prices at the start of March have slipped from records set earlier in 2023, they have rebounded since early November due to central-bank accumulation, increasing jewelry purchases by consumers, and expectations of slower Fed rate hikes.
Gold prices approached $2,000 an ounce, their highest point since April 2022, on Feb. 2, before retreating to about $1,850 in early March.
Here are the top gold stocks in each of three categories: best value, fastest growth, and most price momentum. All data below is as of March 1.
Best Value Gold Stocks
Value investing is a factor-based investing strategy that involves picking stocks that you believe are trading for less than what they are worth, usually by measuring the ratio of the stock’s price to one or more fundamental business metrics. A widely accepted value metric is the price-to-earnings (P/E) ratio. Value investors say that if a business is cheap compared with its intrinsic value—in this case, as measured by its P/E ratio—then the stock price may rise faster than that of others as the price comes back in line with the worth of the company.
These are the gold stocks with the lowest 12-month trailing P/E ratio.
- Torex Gold Resources Inc.: An intermediate gold producer that explores, develops, and operates its 100%-owned Morelos Gold Property in the Guerrero Gold Belt in Mexico. The company’s principal assets include the El Limón Guajes Mine Complex, with open-pit and underground mines as well as a processing plant; and the Media Luna project, an advanced-stage development project. Torex shares also trade OTC in the U.S. under the ticker TORXF.
- Calibre Mining Corp.: This company is focused on acquiring and developing properties with precious metals deposits such as silver, gold, and copper. The company has properties within Central America in the El Limón and La Libertad gold mines. The company also trades OTC in the U.S. under the ticker CXBMF.
- Sandstorm Gold Ltd.: A royalty company that provides financing for gold mining companies in exchange for the right to a percentage of the gold produced from mines. The company has a portfolio of 250 royalties. On Jan. 11, Sandstorm said it sold about 82,400 gold equivalent ounces in 2022.
- Lundin Gold: A mining company that operates the Fruta del Norte gold mine in southeast Ecuador, a multimillion-ounce, high-grade gold property. Initial gold production at the site began in November 2019, and the company expects to produce an average of 340,000 ounces of gold per year. The company also has shares that trade OTC in the U.S. under the ticker LUGDF. Lundin said in early January that it produced more than 476,000 ounces of gold in 2022, beating guidance.
- Yamana Gold: This company is a precious metals producer with gold and silver properties in Canada, Brazil, Chile, and Argentina. In 2021, it produced more than 1 million gold-equivalent ounces. Gold equivalent production for the year was 88% of the company’s total production, and silver was 12%.
Fastest-Growing Gold Stocks
| Fastest-Growing Gold Stocks | ||||
|---|---|---|---|---|
| Price ($) | Market Cap ($B) | EPS Growth (%) | Revenue Growth (%) | |
| Sandstorm Gold Ltd. (SAND) | 4.80 | 1.4 | 333 | 41 |
| AngloGold Ashanti Ltd. (AU) | 17.10 | 7.2 | 153 | 18 |
| Agnico Eagle Mines Ltd. (AEM) | 45.39 | 20.7 | -65 | 47 |
| Lundin Gold Inc. (LUG.TO) | CA$13.04 | CA$3.1 | 12 | 14 |
| Karora Resources Inc. (KRR.TO) | CA$4.17 | CA$0.7 | -57 | 19 |
- Sandstorm Gold: See company description above.
- AngloGold Ashanti Ltd.: A South African-based gold mining company. Its largest mine is in Geita, Tanzania, near Lake Victoria. The company also operates mines in Central America, South America, and Australia.
- Agnico Eagle Mines Ltd.: This is a Canadian gold mining company focused on developing mineral properties. Its largest mining operation is in northwestern Quebec. The company also has other mining properties in Finland and Mexico. On Feb. 16, Agnico Eagle released 2022 fourth-quarter earnings results. Net income increased by 102% on a 46% advance in revenue.
- Lundin Gold: See company description above.
- Karora Resources Inc.: An Australian-based mining company that primarily produces gold and nickel. The company has 100% interest in the Beta Hunt and Spargos Reward mines in Western Australia. The company also trades OTC in the U.S. under the ticker KRRGF.
Gold Stocks with the Most Momentum
| Gold Stocks with the Most Momentum | |||
|---|---|---|---|
| Price ($) | Market Cap ($B) | 12-Month Trailing Total Return (%) | |
| Lundin Gold Inc. (LUG.TO) | CA$13.04 | CA$3.1 | 34 |
| Dundee Precious Metals Inc. (DPM.TO) | CA$8.27 | CA$1.6 | 13 |
| Yamana Gold Inc. (AUY) | 5.14 | 5 | 3 |
| Wheaton Precious Metals Corp. (WPM.TO) | CA$55.23 | CA$25 | 1 |
| VanEck Gold Miners ETF (GDX) | N/A | N/A | -21 |
| Russell 2000 | N/A | N/A | -9 |
- Lundin Gold: See company description above.
- Dundee Precious Metals Inc.: This company acquires, develops, and processes precious metal properties for mining operations. The company owns and operates multiple mines in Bulgaria and a specialty smelting operation in Namibia. On Feb. 16, the company declared a first-quarter dividend of 4 cents a share. It is payable on April 17, to shareholders of record March 31. Shares of the company also trade OTC in the U.S. under the ticker DPMLF.
- Yamana Gold: See company description above.
- Wheaton Precious Metals Corp.: This company finances mining operations in exchange for a portion of the mine’s profit. In November, the company announced a quarterly cash dividend of 15 cents a share, payable Dec. 1, 2022, to holders of record as of Nov. 21, 2022.
Impact of the U.S. Dollar on Gold Stocks
The U.S. dollar, or greenback, has had a longstanding relationship with gold dating back to the introduction of the gold standard in the 1880s, through which paper money was directly linked to a specific amount of the yellow metal. Although former President Franklin D. Roosevelt removed the gold standard in 1933, the greenback still closely correlates with gold—and subsequently gold stocks—as the metal is priced in U.S. dollars.
Typically, a strong U.S. dollar means weaker gold prices as demand for the precious metal eases from buyers using foreign currencies. Conversely, demand increases when the greenback loses value, making gold cheaper for offshore buyers.Although the U.S. dollar and gold often have an inverse relationship, both can move in the same direction. For example, during periods of global uncertainty, both assets may rise as investors flock to save haven investments. Due to its finite supply, gold is seen as a hedge against inflation, while the dollar’s status as the global reserve currency makes it sought after during times of risk aversion.
Advantages of Holding Gold Stocks in Your Portfolio
Key advantages of holding gold stocks include leveraged upside and liquidity.
Leveraged Upside and Diversification: Buying gold stocks allows investors to effectively make a leveraged bet on gold’s price, as miners can increase production and grow their sales when gold rises in value. Because gold stocks closely follow the commodity’s price, the sector also provides a partial hedge against inflation, helping to diversify a “risk-on” equity portfolio.
Gold Discoveries: Large discoveries can significantly increase gold mining stocks’ prices, particularly if a junior miner has a small market cap. For instance, Canadian junior explorer Enduro Metals Corp. (ENDMF) announced that it had intersected gold in one of its mines in May 2021. Subsequently, shares of the small miner more than doubled over the next year.
The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or adopt any investment strategy. Though we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.
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