Gold Is Soaring Again: This Top TSX Stock Is Poised for a Breakout

Here’s why I think Kirkland Lake Gold (TSX:KL)(NYSE:KL) ought to be a top pick for every long-term investor today.

Gold had been underperforming at the beginning of the year. However, recently, the precious metal reached the highest point since February 2021. Reports are coming in that China might be importing more gold while bond yields are pulling back.

Indeed, now would be an excellent time for investors to play this space by adding exposure to elite gold mining companies such as Kirkland Lake Gold (TSX:KL)(NYSE:KL).

China’s demand for gold is bullish for the metal

After trading at underwhelming price levels for weeks, it appears that gold has finally advanced while the dollar and Treasuries are set for weekly losses. According to Reuters, China has given the green light to its banks to import substantial quantiles of the bullion to fulfill domestic demand.

Accordingly, close to 150 tonnes of gold and silver will be shipped in the next few months. China’s demand for gold had jumped up during the start of the previous year owing to the Lunar New Year holiday. Indeed, sales of renowned urban retailers increased more than two times throughout this period. As per the projections of Metals Focus, China’s demand for gold jewelry will increase by approximately 30% during this year.

Kirkland Lake’s fundamentals highlight exceptional value

In the current economic environment, world-class gold miners like Kirkland Lake are highly undervalued. This stock has a valuation multiple of 13 times earnings and trades around the $46 mark at the time of writing. Indeed, shares of this Toronto-based company are dirt cheap right now.

Considering where the rest of the market is with respect to valuation, this stock appears to be a steal.

Indeed, Kirkland Lake’s high-quality mines and excellent margins make for a real long-term winner. Kirkland Lake’s balance sheet is pristine, with essentially no debt. For investors considering the potential of rising gold prices on the horizon, I think Kirkland Lake could finally catch a bid.

Accordingly, I have no doubt that this gold miner is an excellent option for investors to consider in the gold mining space today. Kirkland Lake has room to continue increasing its production and its dividend over time. Indeed, I believe investors simply need to be patient with this stock. Over time, the market will acknowledge the value of this high-quality miner.

Bottom line

For investors who are bullish on gold over the medium and long term, Kirkland Lake stock remains an excellent option. In my view, this gold miner has the potential to outperform for at least 12 months, if not more.

Accordingly, I believe that this is an excellent option for investors to consider today.

Fool contributor Chris MacDonald has no position in any of the stocks mentioned.

More on Dividend Stocks

senior relaxes in hammock with e-book
Dividend Stocks

Top Picks: 3 Canadian Dividend Stocks for Stress-Free Passive Income

For investors looking to pick up reasonable dividend income, but also want to sleep well at night, here are three…

Read more »

Real estate investment concept with person pointing on growth graph and coin stacking to get profit from property
Dividend Stocks

A 7.4% Dividend Yield to Hold for Decades? Yes Please!

Think all high yields are risky? MCAN Financial’s regulated, interest-first model could be a dividend built to last.

Read more »

dividend growth for passive income
Dividend Stocks

3 Canadian Dividend Stocks to Buy and Hold for 20 Years

Three TSX dividend stocks built to keep paying through recessions, rate hikes, and market drama so you can set it…

Read more »

diversification is an important part of building a stable portfolio
Dividend Stocks

TFSA Passive Income: 2 TSX Dividend Stocks to Consider Now

Building out a passive income portfolio with great TSX dividend stocks is easier than it sounds. Here are 2 stocks…

Read more »

top TSX stocks to buy
Dividend Stocks

How to Build a TFSA That Earns +$200 of Safe Monthly Income

If you want to earn monthly income, here is a four-stock portfolio that could collectively earn over $200 per monthly…

Read more »

Printing canadian dollar bills on a print machine
Dividend Stocks

My Blueprint for Generating $113/Month Using a $20,000 TFSA Investment

If you put $20,000 in and divide it 50/50 between both the companies, you could bring in around $113 in…

Read more »

A person's hand cupped open with a hologram of an AI chatbot above saying Hi, can I help you
Dividend Stocks

Is Telus Stock a Buy for Its Dividend Yield?

With a growth plan that is leveraging Telus' artificial intelligence advantages, Telus stock is positioning for strong long-term growth.

Read more »

Dividend Stocks

1 Outstanding Canadian Dividend Stock Down 10% to Buy and Hold for Years 

Explore the current challenges facing dividend stocks in the telecom sector and adapt to changing market conditions.

Read more »