Gold futures (GCG24) have pulled back in recent sessions, with the safe-haven asset moving inversely to U.S. stocks in response to well-received earnings and economic data. The dip could present a buying opportunity, as the recently conquered $2,000 level remains underfoot, and price forecasts are generally bullish.
Analysts at UBS are now looking for gold to hit $2,250 an ounce by the end of 2024, while J.P. Morgan predicts “a breakout rally commencing around mid-2024,” with prices ultimately peaking around $2,300 next year. For investors anticipating higher prices for the popular currency hedge, here's a closer look at three highly rated gold stocks that also offer best-in-class dividend yields.
Gold Stock #1: Agnico Eagle Mines
Agnico Eagle Mines Ltd. (AEM) is a gold mining company based in Canada, with operations further expanding to Mexico, Finland, and Australia, and development activities in the U.S. Valued at $24.36 billion by market cap, AEM has expanded rapidly via acquisitions in recent years. That includes its merger with Kirkland Lake Gold back in 2022, as well as its deal to secure the Canadian assets of Yamana Gold last year.
AEM stock is down 14.5% over the past 52 weeks, though the shares have rallied 14.5% from their October lows.
In its recent Q3 report, Agnico-Eagle Mines reported per-share earnings of $0.44, which beat estimates by 1 cent per share. Revenue came in at $1.64 billion - up 13.3% year-over-year, and easily topping the estimate of $1.57 billion.
The gold miner pays a quarterly dividend of $0.40 per share, which translates to a forward dividend yield of 3.27% for shareholders.
Agnico-Eagle Mines stock has a consensus “Strong Buy” rating, with a mean price target of $65.70 - reflecting more than 32% potential upside to current levels. Out of the 12 analysts covering the stock, 9 have a “Strong Buy” rating and 3 have a “Moderate Buy” rating.
Gold Stock #2: Newmont Mining
Newmont Corp. (NEM) is the world’s largest gold miner, and the only gold producer included in the benchmark S&P 500 Index ($SPX). Headquartered in Colorado, NEM operates in the U.S., Canada, Mexico, Peru, Australia, Ghana, Suriname, the Dominican Republic, Chile, and Argentina. Alongside gold, it also explores for silver, copper, zinc, and lead.
Newmont’s stock has shed nearly 38% over the past year, and is trading near its 52-week low of $33.58.
When the mining giant posted its Q3 results back in late October, it reported a profit of $158 million, down 25.8% YoY. Adjusted EPS of $0.36 was up by 9 cents from the year-ago period, while revenue fell 5% YoY to $2.5 billion. The results fell short of estimates, despite an increase in average realized gold prices to $1,920 per ounce from $1,691 per ounce last year.
Newmont reported lower production in Mexico, Peñasquito, and the Ahafo and Akyem mines in Ghana. However, the downside was partially neutralized by higher production in Peru’s Yanacocha mine.
The company pays a quarterly dividend of $0.40, which translates to a forward yield of 4.65%.
Newmont is a “Moderate Buy”-rated stock with a mean price target of $52.58 - implying massive upside potential of 53% to current levels. Among the 16 analysts covering the stock, 8 have a “Strong Buy” rating, 1 has a “Moderate Buy” rating, and 7 have a “Hold” rating.
Gold Stock #3: B2Gold Corp
B2Gold Corp. (BTG) is a Canadian mining company operating in the Philippines, Mali, and Namibia, with other exploration hubs across four continents. It has a 25% interest in the Calibre Mining Corp, 19% in BeMetals Corp, and a 50% joint venture in the Gramalote gold project in Colombia.
B2Gold’s stock sold off this week after the company lowered its 2024 production guidance, and warned of higher costs. BTG is now down 15.5% over the past 52 weeks.
B2Gold reported its Q3 results in November, where it posted an adjusted profit of $0.05 per share - just short of expectations. Revenue came in at $478 million surpassing the estimate of $465 million, boosted by a 12.2% increase in average realized gold price.
The gold miner pays a quarterly dividend of $0.04 per share, yielding nearly 6% at current levels.
B2Gold has a consensus “Strong Buy” rating from analysts, with a mean price target of $5.01 - signifying an 87% potential upside to current levels. Of the 10 analysts monitoring the stock, 7 have a “Strong Buy” rating, 2 have a “Moderate Buy” rating, and 1 has a “Hold” rating.
