Gold has been synonymous with wealth, prestige, and power since the earliest human civilizations. We still recognize the status of long-forgotten nameless kings of old from their gold-adorned tombs and bodies. And entire regions of the world, like California and South Africa, were shaped by gold rushes.
For most of human history, gold (and sometimes silver) meant money. Until 1971, gold was still the fundamental backing behind the dollar, which itself was the backing behind every other currency.
The dollar’s convertibility into gold stopped in 1971, but gold never stopped fascinating the greater public. In a time of international disorder and successive economic crises, some are looking back at the “barbarous relic” as a safe haven.
At the forefront are central banks, which have been major buyers since 2010. Most of this comes from Eurasian nations, who represent more than 80% of the buying since 1999.
With gold close to all-time-high prices, let’s look at some of the best gold stocks.
Best Gold Stocks
Let’s take a look at a panel of different gold miners and gold stocks profiles. These are designed as introductions, and if something catches your eye, you’ll want to do additional research!
1. Barrick Gold Corporation (GOLD)
| P/E | 82.46 |
| Dividend Yield | 2.89% |
Barrick Gold is the second largest gold miner by market cap and has the largest “Tier 1” asset portfolio (largest gold mines). It produced 4.1 million ounces (Moz) of gold in 2022, as well as 440 million pounds (Mlb) of copper. It has reserves of 76 Moz of gold (18.5 years of production).
The company’s AISC (All-In-Sustainable-Cost) was around $1,200/ounce.
The company is mostly producing in North America and in Africa. It is planning to keep production growing slowly, with roughly 10% more production by 2030.
Barrick is a rather safe bet when it comes to miners, thanks to high reserves and low production costs, even if the African exposure carries some jurisdiction risks.
2. Newmont (NEM)
| P/E | – N/A |
| Dividend Yield | 3.41% |
The largest gold miner by market capitalization and production, Newmont produced 6 Moz of gold and 16 Blb of copper in 2022. It also produced 35 Moz of silver and some lead and zinc. It has reserves of 95 Moz of gold (15.8 years of production).
Most of the company’s production is in the Americas and Australia. Management intends to keep production steady up to 2032 at least.
The company’s AISC (All-In-Sustainable-Cost) was at $1,211/ounce in 2022.
It turns cash flow positive when gold price reaches $1,400/ounce, and adds $400M in free cash flow for every $100 added to gold prices.
Newmont is safer from a jurisdiction point of view, even if South American mines are always a potential risk. Its next debt maturity is in 2029, so it is also fairly well protected from rising interest rates.
3. Equinox Gold (EQX)
| P/E | – N/A |
| Dividend Yield | – N/A |
Equinox produced 0.6 Moz of gold in 2022. It has reserves of 17 Moz of gold (28.3 years of production).
The company’s AISC (All-In-Sustainable-Cost) was rather high, from $1,500 to $1,950. The company operates mostly in the Americas (Canada, USA, Mexico, and Brazil).
It is a very new company by mining industry standards, focused on growth through acquisitions and the opening of new mines.
In 2018 it produced only 25,601 oz of gold. It is planning to double current production by the end of the decade, notably through the Greenstone project, planned to be one of Canada’s largest gold mines.
Between expensive AISC and aggressive growth, the company needs gold prices to stay above 2,000/oz to really make a profit. So this is a good company for an aggressive bet on gold prices, similar to using high leverage on gold prices.
4. Agnico Eagle Mines Limited (AEM)
| P/E | 11.44 |
| Dividend Yield | 2.86% |
AEM produced 3.1 million ounces (Moz) of gold in 2022, as well as 2.3 Moz of silver. Its reserves are 49 Moz of gold (15.8 years of production).
The company’s AISC (All-In-Sustainable-Cost) was around $1,090/ounce.
The company is producing only in North America and Finland and recently merged with Canadian Kirkland Lake. It is planning to keep production growing slowly, with roughly 10% more production by 2030.
This company has very low jurisdiction risk, with little to no growth, a good choice for investors looking for safety.
5. B2B Gold (BTG)
| P/E | 16.92 |
| Dividend Yield | 4.06% |
B2B produced 1 million ounces (Moz) of gold in 2022. It has reserves of 76 Moz of gold (18.5 years of production).
The company’s AISC (All-In-Sustainable-Cost) was around $1,033/ounce.
The company is mostly producing in Africa and the Philippines. It is planning some growth (20% by 2026) through expanding its existing mines (Fekola) and exploration in the region.
Due to its mines’ location, this is a riskier bet, with a corresponding discount on the company valuation. That risk is somewhat compensated by low production costs and no debt.
So this is a better fit for investors willing to accept the jurisdiction risk in exchange for higher dividends and growth.
6. Franco-Nevada Corporation (FNV)
| P/E | 42.98 |
| Dividend Yield | 0.88% |
Not all gold stocks are miners. Royalties companies are another breed of gold stock.
Royalties companies provide financing to gold miners in exchange for either a future percentage of the total revenues of the project or “free” delivery of a percentage of the gold produced. As such, they are relatively shielded from macroeconomic changes that can hurt miners.
Franco-Nevada was a pioneer in that business model. It has a CAGR of 17% since its inception and offers a large diversification of assets and jurisdictions.
Reserves can support around 17 years of operation. It has 419 assets, of which 113 are producing, 45 are in development, and 261 are in the exploration stage. Most of its largest core assets are in Latin America.
Combining its reputation, track record, and focus on high-quality jurisdiction, Franco-Nevada is a strong way to achieve diversification of gold investment while focusing on relatively low-risk assets. The only criticism could be a relatively high valuation.
7. Sandstorm Gold Ltd. (SAND)
| P/E | 17.23 |
| Dividend Yield | 1.02% |
A more recent entry in the royalty business grew its asset portfolio from 3 in 2009 to 250 in 2022. Sandstorm’s strategy is to focus on the lowest-cost mines, with 54% of its assets in the cheapest quartile by AISC (for comparison, Franco-Nevada has just 11% in the cheapest quartile).
Its assets are currently producing 93,000 ounces of gold, with a target of 100-140 Koz in 2024-2028. Revenues come mostly from gold and silver.
Its largest asset is Hod Maden in Turkey. Other large assets are in Peru, South Africa, Brazil, Chile, and Mongolia. Overall, Sandstorm’s focus on cheap production costs makes it more profitable but also exposes it to more risky jurisdictions.
This can make it an option for investors looking for low-cost gold miners, hoping for the royalty business model to provide protection, and looking for diversification against risky jurisdictions.
ETFs (Exchange Traded Funds)
Commodities, and especially gold, can be exposed to political and jurisdiction risks. Owning physical gold can also be difficult to do safely and cheaply. ETFs can address that problem and can provide diversification with even a modest investment.
- VanEck Gold Miners ETF (GDX): This leading gold mining ETF is focused on holding the top gold miners and companies in the world. Newmont, Barrick, Franco-Nevada, and Agnico-Eagle are the top 4 holdings (a third of the fund).
- VanEck Junior Gold Miners UCITS ETF (GDXJ): As exploration for new mines is a very risky business, strong diversification is preferable. The ETF is spread wide, with only 7 stocks composing more than 3% of the portfolio and 2/3 of the holdings at less than 2.5% weight.
- SPDR Gold Shares (GLD): The ETF represents the ownership of gold, the commodity, instead of miners. Each share of the ETF is worth 0.093995 ounces of gold, held in vaults in London.
- Franklin Responsibly Sourced Gold ETF (FGLD): Similar to GLD, but with a focus on holding only responsibly sourced gold bullion.
- Abrdn Physical Precious Metals Basket Shares ETF (GLTR): This fund invests in physical precious metals, including gold (60%), silver (27%), platinum (4%), and palladium (9%).
Gold stocks aren’t for everyone. If you’re looking for exponential gains, you’ll want to look elsewhere. If you’re looking for insurance against financial crisis, currency or sovereign debt issues, investing in gold might be worth a closer look.
