The TSX Composite Index has had a good 2026 so far – rallying an impressive 6%. This is a very strong performance, but one that doesn’t even come close to a particular TSX stock that has already rallied 41% in 2026. Agnico-Eagle Mines Ltd. (TSX:AEM) is a leading Canadian gold stock that’s been firing on all cylinders. This has been driven by macro and company-specific fundamentals that have been perfectly aligned in recent times.
Can Agnico Eagle’s stock price keep rising? Or should we take our profits and head for the hills? Gold is, after all, a commodity, and commodities are notoriously cyclical. Let’s explore.
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Gold prices today
Let’s start by reviewing the price of gold, as this is the biggest single determinant of a gold stock like Agnico-Eagle’s performance.
Gold stocks normally tend to outperform in periods of high inflation, high economic risk and high geopolitical risk. Simply put, gold is a safe haven. This means that gold holds its value better than most financial instruments. It follows then that the price of gold will rally when the perceived and real risks in the world are high. Like recent times.
Tariffs, geopolitical tensions, and a growing malaise in the global economic environment have all contributed to rising gold prices in recent months and years. In fact, gold prices today are 370% higher than 10 years ago, 200% higher than 5 years ago, and 77% higher than one year ago. This is a reflection of the difficult and uncertain economic environment, the geopolitical troubles, and other factors that have caused investors to flock to gold, the safe haven.
Agnico-Eagle – the gold stock to own for gold exposure
Against this backdrop, we have Agnico Eagle Mines – a gold company that has perfected the art of risk mitigation. This shows up in Agnico’s selection of properties, with special attention being paid to the quality of its mines, but also the location of its mines.
We can find Agnico-Eagle’s low-cost, cash-gushing mines in areas such as Canada, Europe, and certain parts of Latin America. These are all politically safe, pro-mining jurisdictions. These mines have been a stable base that has allowed Agnico to benefit from the record run in gold prices.
This has led to strong long-term financial performance for Agnico, and plenty of financial rewards for its shareholders. And the momentum continues. Since 2021, Agnico’s operating cash flow has increased more than 400% to $1.3 billion. Also, its earnings per share (EPS) increased 361% to $8.31.
What’s in store for Agnico Eagle Mines?
Agnico’s strong performance in recent years has enabled the company to increase its dividend numerous times. Its latest dividend increase in the fourth quarter of 2025 was a 12% increase. The company’s strong performance has also built up its cash balance, providing ammunition for its next phase of growth. With record gold mineral reserves, Agnico has a strong growth pipeline and the potential for mine life extensions. According to management, annual gold production has the potential to increase by 20% to 30% over the next decade.
The bottom line
In past articles, I’ve written that Agnico-Eagle is my favourite gold stock. It remains so, as its diversification, strong asset base, and lower risk profile make it a no-brainer, in my view. But of course, the company’s fortunes are tied to gold prices. As a result, your outlook for Agnico Eagle’s stock price will depend on your outlook for gold prices. So if you think that gold prices will remain strong, I think that AEM stock is the TSX gold stock to own. Just be careful because although things look good for Agnico right now, the company is heavily reliant on gold prices, which are difficult to predict. Stay diversified.
