Gold stocks have seen a rapid increase in investor interest over the past six months. Due to the pandemic, investors are continuously searching for new ways to safeguard their wealth. With that, gold has long been considered to be one of the safest ways to store and invest one’s money. The reason why is twofold. For one, gold bullion does not change in value as rapidly as other investments. Given that gold stocks usually follow the price of gold bullion, these investments are more times than not, low volatility.
The second reason is that gold stocks tend to increase in value when markets are in a decline. While we have seen gains in the stock market in the past six months, the uncertainty surrounding COVID has made gold stocks quite popular. Back in August, gold hit an all-time high of $2,089.20 before falling back down slightly. This high price reflected major market uncertainty from investors.
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And despite the market’s slight rebound, interest in gold stocks and gold bullion has remained high. If we look at other major assets, we see that gold and other precious metals have outperformed comparatively. With that in mind, let’s take a look at five top gold stocks to watch.Top Gold Stocks to Watch
- Freeman Gold Corp. (OTC: FMANF Stock Report) (CSE: FMAN)
- Great Panther Mining Ltd. (NYSEAMERICAN: GPL Stock Report)
- Barrick Gold Corp. (NYSE: GOLD Stock Report)
- New Gold Inc. ( NYSEAMERICAN: NGD Stock Report)
- Coeur Mining Inc. (NYSE: CDE Stock Report)
Freeman Gold Corp. is one of the more interesting exploration companies in the gold industry. The company has centered its business model around finding new exploration projects for development. While the company does have a broad focus on North America, it has maintained the importance of its Lemhi Mine Project in Lemhi County, Idaho. This mine stands as Freeman’s main exploration project as of late 2020. Back in August, Freeman announced that it had begun a large scale 5,000-meter diamond drill program at the mine. Only a month or so later, Freeman announced a new development for the Lemhi Mine.
This development consisted of striking a deal with Yamana Gold Inc. (AUY Stock Report) with Freeman acquiring a back-in right to the Lemhi Project, from Yamana. When the news hit the market, it was incredibly exciting as it offered both parties a great opportunity. Yamana now has a 5% equity stake in Freeman Gold which is worth around 4.3 million common shares of the company.
After the deal was announced, the President and CEO of Freeman Gold stated that “we are delighted to welcome Yamana as a 5% strategic shareholder. Having a major gold producer with Yamana’s caliber take a significant position in our company is a major vote of confidence in the project and the team we have assembled. We hope to work together in the coming months.”
Over the last week and a half, FMAN stock has galloped higher from C$0.54 to highs this week of C$0.68. Furthermore, FMANF stock has also seen an increase in trading momentum. Since September 28th, shares climbed in the U.S. from $0.37 to highs this week of $0.51.Top Gold Stocks to Watch #2: Great Panther Mining Ltd.
Great Panther Mining Ltd. is a gold and silver producer that has a focus on the Americas. The company has a heavy focus on South America including mines in Brazil, Mexico and Peru. Great Panther also states that it is actively working on the development of new mining projects where they can be found. Recently, the company announced that it had published its first sustainability report. This should help to give investors some confidence in the practices that Great Panther is using in its business.
CEO of the company, Rob Henderson stated that “we are excited to release our inaugural sustainability report, Mining for Good, which demonstrates our progress and commitment to advancing sustainability programs, increasing transparency of our performance and continuing dialogue on these crucial matters most relevant to the company’s stakeholders. While we have made significant progress, we also recognize there is much work to be done, and we are committed to doing so.”
In the past six months, GPL stock shot up around 140%. This is quite a substantial gain and illustrates just how much bullish interest there is in Great Panther. For that reason, it remains one of the gold stocks to watch.Top Gold Stocks to Watch #3: Barrick Gold Corp.
Barrick Gold Corp. is one of the majors by market cap in the gold mining industry. In the past month alone, estimates for per quarter earnings have shot up from around $0.27 to $0.29. For the full year, that number has jumped to $0.95 per share. The CEO of the company recently stated that there should be higher rates of consolidation in the gold industry.
This sentiment seems to be shared across the gold mining industry because it would help to increase the amount of gold mined. He stated that the reserves of gold are being depleted at current rates and more gold needs to be mined in the short and long term.
For some context, Barrick Gold works in both the production and sale of gold as well as mine development and acquisition. The company has several properties around the world, but its main focus is on North America. In its latest quarterly report, the company announced that it had received revenue of $3.06 billion and a net profit of around $357 million.
This is quite substantial and a considerable rise from the previous year’s revenue of $2.06 billion with a net profit of $194 million. With this in mind, GOLD stock remains an intriguing gold stock to watch.Top Gold Stocks to Watch #4: New Gold Inc.
New Gold Inc. is considered to be an above-average performer in the gold mining industry. This year, NGD stock move up around 134% to date. This is a big advantage over the decline that the overall market took in that same time frame. Despite this, New Gold Inc saw its revenue drop by around 8% which makes sense given the current state of the world and the effects of the pandemic. But, it does seem like bullish sentiment is improving within the company.
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The company states that it is involved in the exploration, mining and development of gold and other precious metals. This includes mining locations in the U.S., Canada, Mexico, Chile and Australia. Because of how broad New Gold Inc’s market is, many believe that it has a great amount of exposure to the larger market.
Recently, the company announced that it had sold its Blackwater Project to Artemis Gold, Inc for around $190 million. In addition, New Gold received roughly $35 million worth of Artemis Gold stock. This should help New Gold Inc to build up its capital for the further expansion of properties around the world.
This week, B of A Securities raised its price target to $1.75 for NGD stock. However, it still maintains an Underperform rating.Top Gold Stocks to Watch #5: Coeur Mining INc.
Coeur Mining Inc. is engaged in the development and production of gold and other precious metals. Although it does mine silver, zinc, and lead, it primarily works in the development of gold and silver properties. The company has several key mines under its belt.
This includes the Palmarejo gold and silver mine in Mexico, the Rochester gold mine in Nevada, the Kensington Gold mine in Alaska, and several mines across Canada. Once mined, the company takes its ore to third party refiners in the U.S. and abroad where it is then turned into gold bullion. In the past six months alone, CDE stock has returned around 85% to investors. Prior to this, however, we see that trading for CDE stock has remained relatively stable.
In September, shares of Coeur Mining dropped around 13% alongside the rest of the mining industry. After a massive bull run from March to September, many of the leading gold stocks to watch saw decent price corrections. In addition to gold, Coeur Mining also has exposure to the silver mining industry.
When silver hit a high of $30 per ounce in August, Coeur Mining also shot up in value. These small corrections are normal in precious metal prices, especially after large bullish runs like we have seen. Investors believe that the price of gold may continue to rise as geopolitical tensions sharpen in the near future.The Future of Gold Stocks
While it is difficult to predict the future of gold stocks, the industry does look good in the short term. Because of Covid it seems as though there is more volatility in the stock market than in many years prior. With gold stocks however, this volatility is usually much less than the broader market. Whether investors are looking for growth or stability in their portfolios, gold stocks may just be the right choice.