Why investors should consider gold stocks
Gold has been one of the safest investments for centuries, which is still true in 2024. In the second quarter, the metal’s price peaked at over USD 2,450 per ounce. This suggests it is time to buy gold stocks — shares in companies that mine the precious metal.
The record rise in the asset’s value was due to the fall in inflation and hopes for lower interest rates. Central banks’ policies of actively replenishing their reserves also boosted prices. Analysts also noted a slowdown in the outflow of funds into ETFs.
Overview of promising companies
Despite the decline in June, the precious metal remains an attractive investment. The price remains high, helping to boost mining companies’ profitability. A look at some of the industry leaders offers a glimpse of the upside for gold stocks:
1. Galiano Gold. Since the beginning of 2024, the company’s shares have risen by almost 88%. The market capitalisation is more than C$597 million. The company is developing deposits in Ghana, and its reserves are worth 2.1 million ounces. Galiano Gold sold 31.8 thousand ounces in the first quarter. Revenue for the period was USD 65.5 million.
2. Since the beginning of the year, Goldfields has increased its capitalisation by 85% to USD 293 million. The company has mining operations in South America and West Africa. Recent exploration has increased the mineral resource estimate by 320%. Indicated gold volumes reached 922 thousand ounces. The news helped the share price rise to USD 1.4 per share.
3. Perpetua Resources. Market capitalisation is approximately USD 564 million, up 81.5% year-on-year. The share price has risen to USD 7.7 per share. Mining operations are in the United States. In addition to gold, the company also controls antimony reserves of about 206 million pounds.
4. G Mining Ventures is developing a mine in Brazil. Since the beginning of the year, the company’s share price has risen by 69.7%, reaching USD 2.4 per share. The market capitalisation is over USD 1 million, and gold reserves are worth 2 million ounces.
5. Mineros. Market capitalisation has risen by almost 68% since the beginning of the year to USD 321 million. The stock is worth around USD 1.1 per share. The company mines precious metals in Latin America. In 2023, Mineros produced 93.8 thousand ounces of gold. It plans to increase production by 44.7 ounces per year until 2027.
The companies’ successes discussed above point to the promise of gold stocks. Investing in them is an excellent strategy for preserving and multiplying capital against rising inflation.
