Gold Prices Are Rising: 2 Mining Stocks to Buy Today

Gold mining stocks offer a great way to tap into the resilience of this shiny metal in weak markets, but hold on in bullish markets as well.

| More on:
stock market

Image source: Getty Images

Gold prices have been going up since November 2022. Multiple factors have contributed to this rise, including interest rates in the US, a weakening dollar, and uncertainty in the global market. However, we have yet to see how long the gold bull market will last this time. The uncertainty raises the risk of making smart, short-term investments.

But if you are in it for the long haul and wish to keep the gold stocks you buy for the long term, there are two companies you should consider looking into.

A Toronto-based gold company

Barrick Gold (TSX:ABX) is the second-largest gold mining company in the world, right behind Newmont. It has about nine gold-producing projects and several explorations and other projects around the globe. Currently, the largest gold-producing region for the company is Nevada. The Nevada gold mining complex is the largest of its kind in the world and the crown jewel of Barrick’s portfolio.

However, the company is expanding its horizons with new projects. This diversification can help it secure its long-term future. The 2021 output of the Barrick group was roughly 4.4 million ounces of gold, and even at this pace, its proven reserves are expected to hold out for at least a decade.

This gold stock has gone up following the gold price, rising over 44% since Nov 2022. If the gold prices keep moving in the same direction, you may experience decent growth from your Barrick Gold holding, making it a great buy today. The dividends are another attractive feature of this gold stock. The current yield is 2%. But it may become more attractive during a slump.

A Nevada-based gold company

At a market cap of about $610 million, Nevada-based Argonaut Gold (TSX:AR) is much smaller compared to Barrick Gold, at least in market capitalization.

The stock has fallen off a cliff since its all-time high valuation in November 2021 and is still trading at an 80% discount to that price point. Two of the reasons behind this tragic slump are its brutal share dilution and the cost overruns in the Canadian Magino project.

The company went through a leadership change, and the stock is turning the ship around. Partly due to the drastic fall it experienced, this mining stock is riding the gold-price wave harder than its counterparts. It’s already up 108% from its November 2022 price and has risen 25% since the beginning of 2023.

Considering the pace it has maintained so far, if gold prices keep rising till the end of 2023, you may easily double your capital by investing in this beaten-down gold stock now. However, since the company is already considered risky due to its past poor choices, more bad press may be enough to push it down, even if gold prices keep rising.

Foolish takeaway

The two gold stocks offer two completely different approaches to entering the gold market. You can choose a reliable and well-established producer like Barrick and benefit from modest, long-term growth and dividends. Or you can pick the beaten-down gold stock that may offer exceptional growth just by reaching the peak it fell from, assuming nothing goes wrong along the way.

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 Adam Othman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Metals and Mining Stocks

growing plant shoots on stacked coins
Stocks for Beginners

1 Copper Stock to Buy as Copper Prices Shine

The price of copper continues to climb, and more copper production is on the way for this top stock up…

Read more »

silver metal
Metals and Mining Stocks

Buy the Dip: 1 Dividend Stock Due to Shine

This dividend stock's dividend just rose higher as the price of silver dropped, but don't let that scare you off…

Read more »

risk/reward
Metals and Mining Stocks

Iron Stomach? 2 Riskier Stocks That Could Pay Off Big Time in the Future

Two TSX stocks could deliver greater earnings to investors with higher risk appetites.

Read more »

Gold bullion on a chart
Metals and Mining Stocks

This Gold Stock Just Dipped 5%: Time to Buy?

This gold stock has been rising higher and higher but recently went through a 5% dip in share price. So,…

Read more »

Gold king in chess game face with the another silver team on black background (Concept for company strategy, business victory or decision)
Stocks for Beginners

Pan American Silver: Buy, Sell, or Hold?

PAAS stock (TSX:PAAS) is up 44% in the last year alone! But it's not all down to the rise in…

Read more »

Nuclear power station cooling tower
Metals and Mining Stocks

1 Canadian Mining Stock Worth a Long-Term Investment

Strong fundamentals should continue to boost Cameco stock's long-term outlook, as the nuclear industry's momentum continues.

Read more »

Super sized rock trucks take a load of platinum rich rock into the crusher.
Metals and Mining Stocks

Lundin Mining Stock: Buy, Sell, or Hold?

Lundin (TSX:LUN) stock saw its shares surge this last year with the price of copper, and more strong guidance could…

Read more »

grow dividends
Metals and Mining Stocks

Invest $5,000 in This Dividend Stock for $1,060 in Passive Income

Franco Nevada stock trades at a 20% discount to consensus price target estimates while offering investors a tasty yield of…

Read more »