The Motley Fool

3 Gold Stocks to Watch Ahead of Earnings

Image source: Getty Images.

If you’re looking to recession-proof your portfolio, only a few options can really make it solid. One of those options? Gold.

Over the next two years, analysts are predicting that while gold may not grow all that much, it likely won’t sink either. In fact, even if the entire continent of North America hits a hard recession, that doesn’t mean the entire world will stop buying gold. China, for example, is a huge purchaser of the product and this is likely to continue.

So where should you be putting your dollars ahead of a possible recession? If it’s my money, I’d choose Barrick Gold Corporation (TSX:ABX)(NYSE:GOLD), Goldcorp Inc. (TSX:G)(NYSE:GG) and Lundin Mining Corporation (TSX:LUN).

Barrick

There was recently some pretty awesome news for this gold company. Deutsche Bank‘s analyst Chris Terry recently pushed the company out of the “hold” zone and into a “buy.” And honestly, there are a lot of great reasons for it.

Terry attributes the change to the cost-cutting, money-saving, and divesting of assets initiatives the company has taken recently. This all points to a financially stable and responsible company, with an opportunity for investors to take part in a great opportunity.

In 2018, the big news was that Barrick had acquired Randgold and its large portfolio of mines. Just over 10 of the mines produce more than 200,000 ounces, or more of gold per year, which is as much as most mid-tier mines make during their entire operation.

Even more recent was Barrick’s joint venture with Newmont mining for the miner’s Nevada assets. This will also add a lot of value without disrupting Barrick’s balance sheet.

In the next 12 months, analysts expect shares to rise from where they are now at about $18.20 at the time of writing to potentially $30 per share! That’s an increase of almost 65%!

Goldcorp

Speaking of Newmont, another investment investors should be looking forward to is Goldcorp ahead of the company’s finalizing of its $13.38-billion merger with Newmont mining. Analysts believe that investors are still getting a great price for the company ahead of the merger, with prices well below fair value.

But just because the company is merging doesn’t mean that all plans are out the window. The company has continued to see production costs drop as recently opened mines and new projects are completed, and it’s well on the way to achieving its 20/20/20 plan of 20% higher production, 20% lower costs, 20% more reserves.

Like Barrick, this stock also has the potential to double in the next 12 months from about $15.42 per share to $35 per share after this merger is complete.

Lundin

Investors have high hopes for Lundin in 2019. The company purchased its Fruta del Norte gold project in Ecuador back in 2014, and this year it should finally enter production. Why is that exciting? Well, it could be one of the largest gold mines in the entire world! This could turn Lundin into a cash flow powerhouse, with this mine alone pumping out $535 million in annual sales alone.
The miner also signed a $1 billion deal to buy the Chapada copper-and-gold mine from Yamana Gold Inc.  in Brazil. Once investors start seeing proof of this worth, it might be harder to buy at such a deep discount. The company currently trades at $7.38 per share at writing, but that could jump to $9 by the end of this year and even further if you buy and hold this stock.

Just Released! 5 Stocks Under $49 (FREE REPORT)

Motley Fool Canada's market-beating team has just released a brand-new FREE report revealing 5 "dirt cheap" stocks that you can buy today for under $49 a share.
Our team thinks these 5 stocks are critically undervalued, but more importantly, could potentially make Canadian investors who act quickly a fortune.
Don't miss out! Simply click the link below to grab your free copy and discover all 5 of these stocks now.

Claim your FREE 5-stock report now!

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss an important event.

Iain Butler and the Stock Advisor Canada team only publish their new “buy alerts” twice a month, and only to an exclusively small group.

This is your chance to get in early on what could prove to be very special investment advice.

Enter your email address below to get started now, and join the other thousands of Canadians who have already signed up for their chance to get the market-beating advice from Stock Advisor Canada.

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.