With all the inflationary pressures plaguing the economy this year, it’s been no surprise to see a tightening of monetary policy and a rapid rise of interest rates. It’s also no surprise that the price of gold has been under pressure as a result, creating an excellent opportunity to buy some of the top gold stocks in Canada.
Gold should continue to face short-term pressure as interest rates keep climbing. However, with the price already down by nearly 10% this year, gold stocks are offering some attractive value. For long-term investors who are looking to take advantage of this value, now is the time to start looking at some of the top gold stocks to buy.
On that note, here are two top gold stocks that have become ultra-cheap.
One of the largest gold miners in the world
Owning gold stocks can offer exciting growth potential over the long run, particularly when these stocks are in favour and especially if you bought them for cheap.
However, gold production also has its risks, which is why owning a massive and diversified company like Barrick Gold (TSX: ABX)(NYSE: GOLD) is ideal for many investors.
Barrick is a massive $35 billion gold and base metals miner with operations all over the globe. This makes it one of the most diversified stocks in the industry which significantly reduces risk.
It’s been growing production for years, and as gold prices have continued to rise over the last half-decade, it’s seen profits rise as well.
In just the last five years, Barrick’s revenue has increased by 40%. Meanwhile, the stock’s gross profit has increased by an impressive 54%.
Therefore, with the stock now trading off its highs by more than 33% and at a forward enterprise value (EV) to earnings before interest, taxes, depreciation, and amortization (EBITDA) ratio of just 4.9 times, it’s certainly one of the top gold stocks to add to your buy list today.
One of the top value stocks to buy in the gold mining industry
In addition to Barrick, another high-quality gold stock to buy now that it’s become extremely undervalued in 2022 is B2Gold (TSX: BTO)(NYSEMKT: BTG).
B2Gold is a much smaller gold producer. However, it’s also one of the lowest-cost producers in the industry. This gives B2Gold a tonne of advantages over its peers and also makes it a stock that you can buy and hold for the long haul.
Plus, just like Barrick, B2Gold is consistently growing its revenue as it takes advantage of rising prices over the long haul while continuously increasing the amount of gold produced.
Over the last five years, B2Gold’s revenue has increased by over 150%. In addition, its gross profit has increased by over 200%.
So with the stock now trading at the bottom of its 52-week range and at a forward EV to EBITDA ratio of just 2.5 times, the stock has become unbelievably cheap.
B2Gold doesn’t just offer investors a tonne of value, though. The stock also boasts one of the most attractive dividends in this space, currently offering a yield of more than 5.1%.
While this low-cost producer offers such compelling value, it’s easily one of the top gold stocks in Canada to buy before this yellow metal comes back in favour.
