On April 28, OceanaGold Corporation (TSX:OGC) released its first-quarter earnings report, and results blew past the expectations of most Wall Street analysts. Gold production for the quarter hit a record 122,782 ounces, generating $161.1 million in sales and EBITDA of $77.9 million. Profits were aided by all-in sustaining production costs falling to $716 per ounce. Operating cash flows were $31.7 million.

Strong financial results have helped push the company’s shares up over 100% from its lows set in 2015. After the strong run, however, the stock is trading at its highest level in nearly a decade. What can investors expect moving forward?

Positioned for stability

As with every other miner, OceanaGold will continue to rely heavily on the underlying price of its key commodity exposure, namely gold. In an industry strife with indebtedness and high costs, however, the company stands out.

Its production costs are nearly the best in the industry with even its most expensive mines having all-in costs of less than $1,000 an ounce. Gold prices recently topped $1,300 an ounce. With a market cap of roughly $2.8 billion and cash levels of $118 million, the company only has $195 million in total debt. It also has $67 million left in undrawn credit facilities.

Over the past few years, the gold mining industry has experienced wild swings along with a few major bankruptcies. Even if gold prices weaken, you don’t need to worry about OceanaGold struggling for financing. It’s used its strong financial backing to take advantage of struggling competitors in the past.

Last year, it acquired Romarco Minerals Inc. after its shares fell 50% in 12 months. OceanaGold only needed to add $10 million in debt to finance the deal. The acquisition will add 172,000 ounces of annual gold production by 2017 with all-in costs of just $414 per ounce. The combined company should eventually produce 540,000 ounces of gold with all-in costs of $533 an ounce.

The premium valuation is justified

While much of the upside has already been realized, OceanaGold deserves its valuation premium. Its limited leverage allows it to be profitable even with dramatically lower selling prices. It also sets the company up to buy struggling competitors at discounted prices. While the company undoubtedly would prefer higher gold prices, OceanaGold is the rare miner that can boost long-term shareholder value throughout the commodity cycle.

Looking ahead, management anticipates maintaining its strong operating margins, low-cost production, and limited leverage. By 2017, gold production should top 500,000 ounces with costs falling below $600 an ounce. As a testament to the company’s conservative approach, management is budgeting its spending based on $1,100 an ounce gold, despite current prices being $200 an ounce higher.

If you’re a long-term investor looking to play the eventual recovery of precious metals, OceanaGold is a limited-risk way to invest. If you want our best idea, however, check out our recent “double down” stock below.

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Fool contributor Ryan Vanzo has no position in any stocks mentioned.