Gold is at an all-time high, and even though the dip a few weeks ago didn’t manifest into a full-blown market crash, there is still a little bit of uncertainty in the market. It’s true that there are more variables pointed towards a bullish or, at least, a stable market.
Still, if a solid enough negative catalyst appears or the market takes another dive soon after the recent one, investors will become even more wary.
That can benefit the gold stocks.
A senior gold-mining company
Kinross Gold (TSX:K) is one of the gold mining giants, not just in North America but on a global scale. It has operations in multiple countries, including four operations in the U.S., two in Chile, and one each in Canada, Brazil, and Mauritania. The total amount of inferred reserves the bank has access to is massive, allowing it to continue its output for over a decade without discovering any new sources.
Kinross hasn’t been an advantageous stock in the last decade despite its impressive portfolio and operational strengths. But its recent performance is phenomenal. It has risen by about 178% in the previous two years. This has pushed its dividend yield down, but if the stock continues to grow at this pace, even a single year’s return might significantly boost your portfolio.
A low-cost senior gold-mining company
While its production numbers could be more impressive, B2Gold (TSX:BTO) has done well enough to be counted among the senior gold-mining companies in Canada. One edge the company proclaims to have over other senior producers is low-cost production, partly because of its geographically diverse portfolio. Two of its three operational projects are in Africa (Mali and Namibia), and one is in the Philippines.
Performance-wise, BTO is the opposite of Kinross. It has been falling almost consistently since hitting its peak in 2020 and is trading at a 58% discount from that peak. The bearish trend has slowed down but has yet to turn. The dividends, at a 5.6% yield, are currently the best part of the stock and the most compelling reason to buy it.
A gold royalties company
Franco-Nevada (TSX:FNV) is a different business from the other two. The company doesn’t own or run gold mining projects; it invests in them. It has developed a massive portfolio of assets it has a full or partial stake in, about 430 in total, about 118 of which are in the production stage. While most of its royalties are in gold, a sizable portion is also in other metals and commodities.
This business model gives the company more cover than a typical gold mining stock, which may be vulnerable to gold price fluctuation. It’s an established aristocrat, though the yield could be more compelling at 1.1%.
The stock was performing very well up until the pandemic, and since then, it has fluctuated around $150 per share and has been trading for $166 per share at the time of writing this. But if it goes bullish and starts growing as it did before COVID, you should consider rushing to buy it.
Foolish takeaway
The three gold stocks are in two different places. Kinross is bullish and may remain so, especially in a favourable market. The other two are waiting for a favourable market to go bullish. They are currently worth considering for their latent growth potential, yield (in the case of B2Gold), and solid dividend history (in the case of Franco-Nevada).
