Hi there, Fools. I’m back to call your attention to three stocks trading near their 52-week highs. Why? Because after a given stock rallies over a short period of time, one of two things usually happens:
- the stock continues to climb as momentum traders pile on; or
- the stock quickly pulls back as value-oriented investors look to lock in gains.
Holding for the long run is still the best way to build wealth. But knowing how to play short-term swings can also help maximize your returns.
This week, we’ll take a look three gold stocks that are riding high.
Centerra of attention
Leading off our list is B.C.-based gold miner Centerra Gold (TSX:CG), whose shares are up 38% in 2019 and are trading near their 52-week highs of $8.20.
Centerra’s diversified nature (gold and copper), attractive assets, and low mining costs continue to benefit shareholders. In the most recent quarter, Centerra produced 183,563 oz. of gold and all-in sustaining costs per ounce sold clocked in at $669.
More importantly, that strength translated into boatloads of operating cash flow.
“Financially, the business delivered approximately $114 million of consolidated cash provided by operations before changes in working capital in the quarter,” said President and CEO Scott Perry. “Kumtor and Mount Milligan generated $110 million and $17 million respectively, before working capital changes.”
Centerra shares trade at a P/E of 12.3.
Presence of royalty
Franco-Nevada is largely considered one of the highest-quality resource streaming companies on the TSX, and recent results suggest no different. In Q1, revenue improved 3.9% to a record $179.8 million while net operating cash flow grew 4.4%.
On that strength, management increased the quarterly dividend roughly 4%, continuing an impressive streak of annual payout growth.
“It is a testament to both the portfolio and our business model that today Franco-Nevada has increased its dividend for the 12th consecutive year adding to the over $1 billion of dividends already paid,” said CEO David Harquail.
The stock currently offers a yield of 1.3%.
Jump in the lake
Kirkland’s recent results have also given Bay Street plenty to applaud. In Q1, revenue spiked 54% to $305 million while both earnings and free cash flow hit quarterly records. Moreover, management raised the lower end of its full-year production guidance to 950 thousand-1 million oz. of gold from $920K-$1M oz.
“Looking ahead, with production and sales levels expected to increase in the second half of the year, we are well positioned for increased levels of profitability and cash flow going forward, assuming existing business plans and gold prices,” said President and CEO Tony Makuch.
Kirkland trades at a P/E of 24.1.
The bottom line
There you have it, Fools: three red-hot stocks worth checking out.
As always, they aren’t formal recommendations. Instead, look at them as a starting point for further research. Momentum stocks are especially fickle, so plenty of your own due diligence is required.
When you buy heavily cyclical stocks at low prices… and then hold the shares until the cycle reaches its peak… you can make a very healthy profit.
Every investor knows that. But many struggle to identify the best opportunities.
Except The Motley Fool may have a plan to solve that problem! Our in-house analyst team has poured thousands of hours into their proprietary research – and this is the result.
Our top advisor Iain Butler has just identified his #1 stock to buy in 2019 (and beyond).
Fool contributor Brian Pacampara owns no position in any of the companies mentioned.