2 Top Canadian Gold Stocks to Add Before They Take Off

Here’s why Kirkland Lake Gold (TSX:KL)(NYSE:KL) and Equinox Gold (TSX:EQX) are two top gold stocks to consider right now.

| More on:
Gold bars

Image source: Getty Images

Among the most undervalued segments in the market right now, gold stocks are trading at levels that appear to be very attractive currently. Indeed, gold’s value as a portfolio hedge amid heightened market volatility is worth considering in its own right. Gold bugs and bears may disagree on the trajectory gold prices are headed in the medium to long term. However, on the basis of existing fundamentals and current commodity prices, many gold stocks look extremely attractive right now.

In this article, I’m going to highlight two gold stocks that I think provide incredible value right now.

Top gold stocks: Kirkland Lake Gold

One of the gold miners I continue to pound the table on is Kirkland Lake Gold (TSX:KL)(NYSE:KL). Kirkland Lake spiked approximately 8% this morning on rumours the company could be acquired in the near term. Indeed, such a move would unlock the sort of value I’ve seen with this stock for some time.

This is a company with absolutely stellar fundamentals and a pristine balance sheet. The company is sitting on a massive cash reserve of more than $850 million, with essentially no debt. Accordingly, the company’s current valuation of less than 15 times earnings appears absurdly cheap to me right now.

It appears other companies agree. The gold mining sector is one that has been consolidating for some time. I expect other, larger players are likely to take aim at Kirkland Lake’s high-quality assets and look to acquire this gem at these rock-bottom levels. Accordingly, I think a tremendous amount of value could be unlocked in the near term for investors who have held steady with this stock.

Kirkland Lake remains among the best gold stocks in the market right now. It appears the market is finally starting to catch up to this company’s deep value. Accordingly, I think this is a company worth considering pre-offer, should these rumours hold water or not.

Equinox Gold

Another one of the top gold stocks I’ve been touting as a buy for some time is Equinox Gold (TSX:EQX). This smaller-cap producer with a market cap under $3 billion provides excellent leverage to the price of gold and a high-potential bet for those bullish on the sector.

The company has grown its footprint organically and via acquisitions of late. This is a relatively new company in the gold mining world, commencing production just five years ago. However, over the next few years, Equinox gold expects to double its production.

Analysts remain bullish on this stock, with one analyst estimating shares have 50% upside potential from here. I think that’s spot on.

Additionally, Equinox’s mines are located in favourable mining jurisdictions. Like Kirkland Lake, there’s a lot to like about the potential of these gold stocks to outperform over the near, medium, and long term. Accordingly, these two top TSX gold stocks are ones I’d invite investors to look at closely right now.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

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

More on Metals and Mining Stocks

tsx today
Metals and Mining Stocks

TSX Today: What to Watch for in Stocks on Monday, January 30

Corporate earnings and the Fed’s interest rate decision will remain on Canadian investors’ radar this week.

Read more »

Electric car being charged
Tech Stocks

Is Now The Time to Buy EV Stocks?

EV stocks may be down now, but don't count them out. They'll soon be back up again, so now may…

Read more »

Hands protect a sprout in fertile soil.
Metals and Mining Stocks

Nutrien Stock: How High Could it Go in 2023?

After Nutrien's record 2022 driven by strong pricing power, 2023 should see more of the same, driving the stock much…

Read more »

Gold bullion on a chart
Metals and Mining Stocks

Silver and Gold Stocks: Worth Owning in 2023?

The stock market took a breather from bears as inflation slowed. But recession fears still loom. Should you buy gold…

Read more »

Metals and Mining Stocks

BUY ALERT: Why I’m Snagging Russel Metals (TSX:RUS) Stock Today

Russel Metals Inc. (TSX:RUS) has started hot in 2023 and boasts nice value and a strong dividend in late January.

Read more »

tsx today
Metals and Mining Stocks

TSX Today: What to Watch for in Stocks on Wednesday, January 25

TSX investors may want to keep a close eye on the Bank of Canada’s monetary policy event today.

Read more »

silver metal
Metals and Mining Stocks

How to Invest in Precious Metals Without Buying a Mining Stock

Do you want to invest in precious metals without buying a mining stock? This unique business can offers a lower-risk,…

Read more »

A tractor harvests lentils.
Metals and Mining Stocks

5 Things to Know About Nutrien Stock in January 2023

Nutrien Ltd. (TSX:NTR) stock has put together a nice run on the back of strong fundamentals and geopolitical tensions.

Read more »