Gold stocks – the ultimate safe haven. These days, escalating tariff wars and increasing geopolitical risk around the globe has investors looking for safety. This is where gold stocks come in. But what is the best gold stock to buy right now?
Let’s take a look at which one is better, Barrick Gold Corp. (TSX:ABX) or Agnico Eagle Mines Ltd. (TSX:AEM).
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Agnico Eagle Mines
I’ve written about Agnico Eagle Mines stock many times before. It has in fact been my favourite gold stock to own for many years now. My reasoning is fairly simple. Agnico has it all – solid assets, exemplary operational performance, and very low political/country risk.
The price of gold has hit US $3,000 per ounce for the first time ever. Trading at all-time highs and showing no signs of slowing, it’s no surprise that most gold stocks, like Agnico Eagle, are rallying. In fact, Agnico Eagle stock has doubled since the end of 2023 and increased 33% since the beginning of this year.
So why do I like Agnico Eagle stock? Well, firstly, I like that Agnico-Eagle’s mines are all in politically safe, pro-mining jurisdictions. This includes places like Canada, Europe, Australia, and Mexico. This means that Agnico’s mines operate without disruption caused by civil unrest and/or government interference. In turn, this leads to consistently stable results that are only affected by market forces and operational factors. In other words, Agnico is more of a master of its own fate, versus other gold companies that have operations in unstable parts of the world.
Also, Agnico has strong operational performance. This has translated into record production, cash flows, and earnings as well as strong shareholder returns. For example, Agnico reported record free cash flow of $2.1 billion in 2024. Also, costs were the lowest among its peer group and earnings per share (EPS) of $4.23 blew past expectations and were 90% higher than the prior year.
Barrick Gold
Barrick is a different beast altogether, with operations in very risky parts of the world. In fact, Latin America and Asia Pacific accounts for 17% of gold production, and Africa and the Middle East accounts for 38% of gold production.
While Barrick is also seeing strong cash flows as a result of strong commodity prices, the company is experiencing problems in its operations in Africa. Back on January 14, Barrick temporarily suspended operations of its mines in Mali. This was is response to restrictions that the government imposed on the company. In violation of their conventions, the government has actually been blocking Barrick’s gold exports since early November 2024.
This is the kind of business interruption that companies risk when they operate in unstable countries. And this is why Agnico has chosen to steer clear of these countries.
This risk is not easily overlooked at any time, and this is why I chose to invest in Agnico Eagle years ago for my gold exposure. It’s also why I continue to favour Agnico Eagle as my gold stock of choice.
The bottom line
In conclusion, I definitely think that the best gold stock to buy right now to take advantage of the strength in gold prices is Agnico Eagle. It provides a safe haven that can shelter investors from geopolitical risks and even benefit from them.
