In this article, we will take a look at the 15 best gold mining stocks to buy now. To see more such companies, go directly to 5 Best Gold Mining Stocks To Buy Now.
Over the past few months many have questioned the notion of gold being an inflation hedge. Gold price has seen a lot of volatility as markets went through wild swings amid interest rate hikes, geopolitical headwinds and changing expectations about the future of markets. A strong dollar and rising bond yields made it difficult for gold to gain ground. Still, gold remains an extremely relevant asset and wise investors still consider it a safe-haven asset during troubled times. Earlier this month a Bloomberg report cited data from Invesco which said that the world’s sovereign wealth funds and investors are amassing gold. Invesco cited its survey of 85 sovereign wealth funds and 57 central banks collectively managing about $21 trillion in assets. The survey showed that gold remains an inflation hedge and a “significant portfolio” of central banks are expecting to buy more gold over the next three years. Invesco’s report said that America's move to freeze Russian assets is one of the primary events causing the demand of gold to surge.
In March 2023, Wisdom Tree said in its gold outlook report that while gold could reach a nominal high in 2023, a “real” high remains out of reach. Wisdom Tree said that even during the bull case gold prices are expected to remain 11% less than the real highs seen in 1980s. The firm said that if inflation falls significantly and the Federal Reserve manages to control inflation earlier than expected gold could gain value. Wisdom Tree said that while gold suffered in 2022 amid a strong dollar, this year the asset made a comeback amid depreciation in dollar price. Wisdom Tree said that the consensus opinion says that inflation will continue to decline in 2023, and dollar and bond yields will also fall.
“In the consensus case scenario, gold reaches US$2082/oz by Q4 2023, piercing through previous all-time nominal highs (US$2061/oz on 7 August 2020). However, in real terms this does not reach an all-time high, which was reached in January 1980. In fact, it would be 19% below that level; and in real terms it is still 11% below the 2020 high."
Wisdom Tree also talks about what it calls the “Siegel” case, referring to Professor Jeremy Siegel of Wharton Business School. Siegel, who is also an advisor to WisdomTree, famously believes the Federal Reserve is overreacting with interest rate hikes and expects the Fed “to recognise what he deems to be a mistake and cut interest rates to 2-3% by year end and that 10-year yields will fall 2.9%." Wisdom Tree said that in this scenario gold price could skyrocket to $2135/oz.
In their 2023 In Gold We Trust report, Sprott’s analysts said that central banks around the world have been aggressively piling into gold since 2009. In 2022 central banks increased their gold purchases by 152% to over 1,136 tons. The report said that China became a net buyer of gold for the first time in history and countries like Qatar, Iraq, and the United Arab Emirates were also buying gold. The report said that central banks and investors have been piling into gold to protect themselves against the “stubborn inflation.” However, the report noted that investor interest in gold remained “subdued.” However, the report said that this was about to change.
“The gold price already seems to anticipate that the restrictive US monetary policy will turn out to be a bluff. Even if the gold price in US dollars has not yet marked a new all-time high, the all-time highs in various other currencies are a harbinger of the breakout in US dollars.”
While gold demand from China played a key role in gold price increases, latest data shows that factor might be weakening. Retail sales of gold and silver jumped about 24% year-on-year in May to 26.6 billion yuan ($3.7 billion), which was down from 44% and 37% growth recorded in the previous two months, according to a report from Bloomberg. However, the report quoted Zhang Ting, an analyst with Sichuan Tianfu Bank Co., who thinks retail sales could rebound and increase in the coming months as gold is seen as a “sound investment” amid inflation concerns. The analyst also said that more gold purchases from the Chinese government can also offset any declines in retail sales of gold.
Best Gold Mining Stocks To Buy Now
Photo by Ricardo Gomez Angel on Unsplash
In this backdrop, it’s interesting to see which gold mining stocks hedge funds are piling into.
Our Methodology
For this article, we first listed down all holdings of VanEck Gold Miners ETF (GDX) and then picked the 15 stocks from these holdings with the highest number of hedge fund investors. We gauged hedge fund sentiment using Insider Monkey’s database of 943 hedge funds.
South Africa-headquartered gold mining company Harmony Gold Mining Co. (NYSE:HMY)’s shares have gained about 13% year to date.
A total of 13 hedge funds tracked by Insider Monkey had stakes in Harmony Gold Mining Co. (NYSE:HMY). The biggest stakeholder of Harmony Gold Mining Co. (NYSE:HMY) was Kopernik Global Investors of David Iben which owned a $72 million stake in the company.
Of the 943 hedge funds in Insider Monkey’s database, 14 hedge funds reported having stakes in SSR Mining Inc. (NASDAQ:SSRM), the Denver, Colorado-based company that explores for gold, copper and silver.
Palm Valley Capital Fund made the following comment about SSR Mining Inc. (NASDAQ:SSRM) in its second quarter 2023 investor letter:
“During the second quarter, the Fund fully exited three positions. We also sold our stake in SSR Mining Inc. (NASDAQ:SSRM) as the shares approached our intrinsic value estimate, and the company’s operational and financial risk increased after it announced a new investment in the Hod Maden Gold-Copper Project based in Turkey.”
In May Osisko Gold Royalties Ltd (NYSE:OR) upped its quarterly dividend by 9.1%.
A total of 16 hedge funds in Insider Monkey’s database of 943 hedge funds reported having stakes in Osisko Gold Royalties Ltd (NYSE:OR). The biggest stakeholder of Osisko Gold Royalties Ltd (NYSE:OR) was Sprott Asset Management of Eric Sprott which owns a $53 million stake in the company.
Palm Valley Capital Management made the following comment about Osisko Gold Royalties Ltd (NYSE:OR) in its Q1 2023 investor letter:
“We did not purchase any new holdings for the Fund during the first quarter. In January, we sold one position: Osisko Gold Royalties Ltd (NYSE:OR). Osisko reported record royalty and streaming revenues as it has steadily grown its portfolio of assets, which is skewed toward Canada—considered to be the highest quality jurisdiction for miners. The company recently deconsolidated the results of mining developer Osisko Development from its financials, clarifying Osisko Royalties’ business model for less familiar investors. Each quarter, we update the company’s NAV based on the underlying value of each of its key royalty and streaming interests, in addition to the net financial assets it holds. Osisko’s share price exceeded our estimate of NAV, so we sold the position.”
Hecla Mining Company (NYSE:HL) shares have gained about 52% over the past one year.
A total of 17 hedge funds in Insider Monkey’s database had stakes in Hecla Mining Company (NYSE:HL). The biggest stakeholder of Hecla Mining Company (NYSE:HL) was Sprott Asset Management of Eric Sprott which owns a $16.3 million stake in the company.
Illinois-based company Coeur Mining, Inc. (NYSE:CDE) ranks 11th in our list of the best gold mining stocks to buy according to hedge funds. 17 hedge funds in Insider Monkey’s database had stakes in Coeur Mining, Inc. (NYSE:CDE). The biggest stakeholder of Coeur Mining, Inc. (NYSE:CDE) was Paul Marshall and Ian Wace’s Marshall Wace LLP which owns a $27 million stake in the company.
Pan American Silver Corp. (NASDAQ:PAAS) is a part of the VanEck Gold Miners ETF. Earlier this year Pan American Silver Corp. (NASDAQ:PAAS) completed its $4.8 billion acquisition of Yamana Gold Inc.
A total of 19 hedge funds in Insider Monkey’s database of 943 hedge funds reported owning stakes in Pan American Silver Corp. (NASDAQ:PAAS) as of the end of the first quarter.
Canadian mining company B2Gold Corp. (NYSE:BTG) has operations in Mali, Namibia and the Philippines.
As of the end of the first quarter of 2023, 20 hedge funds held stakes in B2Gold Corp. (NYSE:BTG). The most notable stakeholder of B2Gold Corp. (NYSE:BTG) during this period was First Eagle Investment Management of Jean-Marie Eveillard which had a $90 million stake in the company. In May B2Gold Corp. (NYSE:BTG) posted Q1 results according to which its adjusted EPS came in at $0.10 surpassing estimates by $0.03. Revenue in the quarter jumped 29.4% year over year to $473.56 million, beating estimates by $32.56 million.
Colorado-based Royal Gold, Inc. (NASDAQ:RGLD) shares have gained about 8.29% year to date through July 11.
As of the end of the first quarter of 2023, 24 hedge funds tracked by Insider Monkey had stakes in Royal Gold, Inc. (NASDAQ:RGLD). The biggest hedge fund stakeholder of Royal Gold, Inc. (NASDAQ:RGLD) during this period was First Eagle Investment Management of Jean-Marie Eveillard which owns a $462 million stake in the company.
Toronto, Canada-based Alamos Gold Inc. (NYSE:AGI) ranks 7th in our list of the best gold mining stocks to buy now. Insider Monkey’s database shows that 943 hedge funds had stakes in Alamos Gold Inc. (NYSE:AGI) as of the end of the March quarter. The biggest stakeholder of Alamos Gold Inc. (NYSE:AGI) was First Eagle Investment Management of Jean-Marie Eveillard which owns a $130 million stake in the company.
In April Alamos Gold Inc. (NYSE:AGI) posted Q1 results. Adjusted EPS in the quarter came in at $0.12 beating estimates by $0.03. Revenue in the quarter increased by 36.3% year over year to $251.5 million, surpassing estimates by $19.95 million.
Palm Valley Capital made the following comment about Alamos Gold Inc. (NYSE:AGI) in its Q4 2022 investor letter:
“For the full calendar year, the Fund’s top performers were Coterra Energy (ticker: CTRA), Amdocs, and Alamos Gold Inc. (NYSE:AGI). Coterra’s stock rose sharply along with energy prices at the beginning of 2022. Amdocs delivered record operating results during the year and demonstrated the strength of its market position serving the world’s leading communication service providers. All the Fund’s precious metals holdings, led by Alamos, contributed positively to performance in 2022, with a 1% collective contribution from gold and silver equities. We think this was a good outcome relative to gold and silver prices that ended the year essentially flat, after a summer swoon. Additionally, precious metals miners were down, on average, in 2022.”
Another Canadian gold company in our list, Kinross Gold Corporation (NYSE:KGC) shares have gained about 45% over the past one year.
Last month, Bloomberg reported that Kinross Gold Corporation (NYSE:KGC) rejected a takeover bid from Endeavour Mining (OTCQX:EDVMF).
Hedge fund sentiment for the company slightly increased in the first quarter of 2023, as 26 hedge funds in Insider Monkey’s database reported owning stakes in Kinross Gold Corporation (NYSE:KGC), up from 24 funds in the previous quarter. The biggest hedge fund stakeholder of Kinross Gold Corporation (NYSE:KGC) was Ali Motamed’s Invenomic Capital which Management which owns a $25 million stake in the company.
