We recently published a list of Top 10 Gold Stocks with Dividends. In this article, we are going to take a look at where Pan American Silver Corp. (NYSE:PAAS) stands against other top gold stocks with dividends.
Gold’s performance as an asset in 2024 has been immaculate, despite increasing global constraints. The price for it crossed the $2,900 per ounce mark, driven by strong purchasing by the central bank, increased investor demand, and its role as a hedge against economic uncertainties. Gold’s value as a safe haven increased due to inflationary concerns and increasing geopolitical instabilities, gaining interest from retail and institutional investors.
Total gold demand, including over-the-counter (OTC) investments, has reached a record high of 4,974 metric tons in 2024, as per the World Gold Council. This increase was majorly driven by central banks, which contributed over 1,000 metric tons of gold to the demand for the third consecutive year. Particularly central banks in emerging markets, such as China and India, looked to increase their gold reserves to diversify away from the U.S. dollar. Gold provided an astonishing return of 43.83% for the previous year, significantly above the broader market’s 20.89% gain for the same period.
The investment market for gold has seen major changes, where gold exchange-traded funds (ETFs) reported no major outflows for the first time since 2020, which marks a reversal from previous years of heavy liquidations. Moreover, physical demand for gold has been strong, with purchasing for bar and coins remaining stable at 1,186 metric tons. Technology-driven gold usage has also seen a surge of 7%, driven by the expansion of artificial intelligence and semiconductor industries. These industries rely on gold components for high-performance electronics.
Despite the overall strong performance of the market, gold jewelry demand saw a decrease of 11% in 2024 due to high prices, making it less affordable for consumers. Nevertheless, total spending on gold jewelry in monetary terms increased by 9%, highlighting the overall impact of increasing gold prices. The contrasting situation with lower demand for gold jewelry and high demand for investment highlights the changing role of gold in the global economy.
Market experts and top financial institutions hold a positive outlook on gold’s trajectory for 2025. Goldman Sachs has recently revised its forecast for the gold price to $3,100 per ounce, citing the enhancing accumulation by the central bank and increasing investor interest. Likewise, analysts from J.P. Morgan have projected that gold prices could increase to $3,000 per ounce if macroeconomic instability continues.
Looking ahead, the gold market is being influenced by global monetary policies as well. As per J.P Morgan, major economies like the U.S. and Europe looking to cut down interest rates and lower return on traditional investments will likely drive up the demand for gold. Historically, the opportunity cost of holding gold reduces as traditional investments produce lower yields, increasing prices.
Conclusively, under these circumstances, investment in gold stocks has become a lucrative opportunity for investors looking to gain from the metal’s performance while generating hefty returns through dividends. Gold mining companies with strong financial performance, continual dividends, and major hedge fund backing provide a golden opportunity to enter the sector.
Methodology
To come up with our list of the Best Gold Dividend Stocks to Buy Now, we first recognized companies in the gold sector, offering dividend payments, along with posing strong market capitalizations. We then shortlisted stocks by looking into hedge fund interest, as stocks with strong hedge fund backing often point to stable financials and growth potential.
To rank these stocks, we used Insider Monkey’s Hedge Fund Database as of Q4 2024. The companies were sorted on the basis of the number of hedge funds invested in them, ranking companies with the highest hedge fund interest in ascending order.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Is Pan American Silver Corp. (PAAS) the Best Junior Silver Mining Stock to Buy According to Analysts?
A large drill in operation deep in a mine, surrounded by the machinery of a modern extraction site.
Pan American Silver Corp. (NYSE:PAAS) is a strong player in the precious metals industry, gaining from its diversified mining portfolio across the Americas.
The company reported strong financials for 2024, attaining a record revenue of $2.8 billion through a full-year production from the acquired Yamana assets and strong metal prices. Pan American Silver Corp.’s (NYSE:PAAS) silver production reached 21.1 million ounces, while gold production hit a record 892,000 ounces, aligning with its projections as it navigates through cost pressures.
Further, the company reported an all-time high free cash flow of $445.1 million for the full year, reinforcing its strong margins and efficient operations. It has been able to return capital to its shareholders through dividends and share buybacks due to its strong financials. For Q1 2025, Pan American Silver Corp. (NYSE:PAAS) was able to repurchase around $20 million worth of shares, adding to its total buybacks, bringing its total to 2.6 million shares. Moreover, the company declared a per-share dividend of $0.10, adding to the total payout of $145.4 million over the year in dividends. Pan American Silver has been continuously giving out payouts since 2010, returning over $1 billion to investors in the form of dividends and buybacks.
Additionally, Pan American Silver Corp. (NYSE:PAAS) made key operational strides through several projects in 2024, including a ventilation upgrade at La Colorada, improving throughput, and bringing down costs. Investments in Huaron’s filtration plant and Timmins’ paste backfill facility have driven long-term sustainability. The company has allocated $80 million to reserve replacement in 2025, aligned with its focus on exploration. Furthermore, the company also expects its production to be between 20 to 21 million ounces of silver and 735,000 to 800,000 ounces of gold, in 2025, with cost improvement in the latter of the year.
Conclusively, under Pan American Silver’s strong balance sheet, ongoing operational improvements, and strong shareholder returns, the company is in a secure position among the best gold stocks with dividends.
Overall, PAAS ranks 9th on our list of other top gold stocks with dividends. While we acknowledge the potential of PAAS, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PAAS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
