In 2019, investors have the opportunity to invest in shares of gold mining companies. And due to the meaningful returns and profits, more and more investors are interested in gold mining stocks.
Currently, there are over 300 gold mining companies listed and publicly traded. The stocks of these companies may correlate with the value of gold. However, the growth and return depend on the expected future earnings of the company.
Also, when investors are trying to figure out whether to invest in gold mining stocks or find something less volatile, they need to consider the following factors:
- effective management
- production costs, reserves
- mine exploration
- project development
- hedging activities
Investing in the large gold mining sector is the perfect way to diversify your portfolio as well as gain exposure to the precious metal. So, let’s see which are the three top gold mining stocks worth buying this year.
AngloGold Ashanti (AU)
Market Cap: $5.51 billion
52-week Performance: 47.51%
AngloGold Ashanti (AU) is the third-largest gold mining company in the world in terms of production. The South African company has 21 operations on four continents and was formed when AngloGold Limited and Ashanti Goldfields Company Limited merged back in 2004.
AngloGold Ashanti produced 3.8 million ounces of gold in 2017. In 2018, the company’s AISC (all-in sustaining costs) improved 14% year-over-year for Q3. AngloGold’s two Australian operations, Sunrise Dam and Tropicana, are both located in Western Australia and accounted for 14 percent of the company’s gold production in 2016.
Furthermore, the company strives to generate sustainable cash flow improvements as well as shareholder returns. As AngloGold Ashanti focuses on ensuring the most efficient day-to-day operations, they focus on the following five areas:
- People. They are the foundation of AngloGold Ashanti (AU).
- Balance Sheet. The company keeps its balance sheet always able to meet its core funding needs.
- Optimal Decisions. All spending decisions must be thoroughly scrutinized to ensure they are optimally structured and necessary to fulfill the companies core business objective.
- Actively Managed Portfolio. AngloGold Ashanti’s portfolio of assets is actively managed to improve the overall mix of the production base.
- Long-Term Opportunities. The company keeps a close eye on creating a competitive pipeline of long-term opportunities.
AngloGold Ashanti is a company that strives to deliver better quality production aimed at increasing margins. Also, compared to other companies, AngloGold Ashanti stands out for its safety practices. It is considered to be a smart long-term investment by many experienced investors.
Royal Gold, Inc. (RGLD)
Market Cap: $6.13 billion
52-week Performance: 7.39%
Royal Gold, Inc. is a leading precious metals royalty company, based in Denver. The company has royalty claims on gold, silver, copper, lead, and zinc, and is involved in the acquisition and management of these precious metals. It operates in over 20 countries.
We find the history of this company to be fascinating. In 1981 the company operated as an oil and gas exploration and production company. A few years later, after oil prices crashed, Royal Gold, Inc. entered the gold streaming business. In 2009, the Fortune Small Business Magazine ranked Royal Gold, Inc. 10th among the fastest-growing small companies.
In 2010 the company was receiving royalty payments from 34 mines. That same year, the company experienced the most growth with over a billion of the $1.86 billion in assets it has added during the year.
In 2017, Royal Gold reported a record operating cash flow of $69.7 million during fiscal Q2 2017 as well as $107 million in revenue and earnings per share of $0.43. Last year, the company generated revenue and operating cash flow. It derived 77% of its revenue from gold in its fiscal year.
Since 2001, Royal Gold has a compound annual growth rate of 19%. Also, the company has an excellent track record of creating shareholder value. Many other vital factors rank Royal Gold, Inc. as one top gold stock to consider buying.
Barrick Gold (BCBA)
Barrick Gold is one of the world’s largest gold mining companies, which is committed to creating long-term value for all stakeholders. In 2017, the company took a significant growth leap by acquiring Randgold Resources in a bid to remain the industry leader. The two companies are targeting the high-potential Nevada region, as well as $500 million in annual pre-tax synergies for the first five years.
Once Barrick Gold acquired Randgold acquisition, the company has become the owner of 5 out of the world’s top 10 Tier One gold assets. Among these are Cortez, Goldstrike, and Pueblo Viejo, Goldrush/Fourmile, and Turquoise Ridge (75% stake). Barrick believes that a Tier One asset has a mine life span of at least ten years.
Cortez-Goldstrike Ownership: 100%
Gold produced 2.1 Moz 
Pueblo Viejo Ownership: 60%
Gold produced 581 Koz 
Goldrush-Fourmile Ownership: 100%
Estimated annual gold production 500 000 oz 
Turquoise Ridge Ownership: 75%
Gold produced 268 Koz 
In 2017, Barrick and Randgold’s combined gold production was roughly 6.6 million ounces. Further, Randgold consistently increased dividends in recent years.
Barrick Gold is committed to becoming the world’s most valued gold mining business. The company wants to find, develop, and own the best assets so that it can deliver sustainable returns for its owners and partners. Barrick strives for a global portfolio of prime prospects, which is why the gold stock looks good.
In this article, I shared with you the three top gold mining stocks. However, before investing in these gold stocks or any other stocks, you should do in-depth research on the company.
When was the company founded? By whom? What is the goal of the company? Is the company legit? If I invest and I lose the money, how will that affect me?
These are only a few of the many questions you should ask yourself before investing. The three companies that I mentioned above are among the world’s leading companies. The price of their stocks is influenced directly by the price of gold.
So, when investing in gold stocks, you should prepare to stomach the volatility associated with commodities. After all, the price depends on industry demand and supply dynamics, which are hard to predict.