NGD and WDO: Should you buy these TSX gold stocks amid recession fears?

Highlights

• The primary Canadian index grew 167.5 points to reach 19,028.86 on Monday, July 4
• The TSX materials index spiked by over two per cent this day
• New Gold (TSX: NGD) and Wesdome Gold (TSX: WDO) were among the top five gainers this day

Some TSX precious metal stocks like New Gold (TSX: NGD) and Wesdome Gold (TSX: WDO) were among the top five gainers of the TSX main index on July 4, despite weakness in gold prices, which was around 1800, nearing its lowest level in five months at 5:50 AM EST on Tuesday, July 5. Silver was trading at US$ 19.87 while copper was hovering around US$ 3.52 as of writing.

The primary Canadian index grew 167.5 points to reach 19,028.86 on Monday, July 4. This jump to the green territory was partially derived from the materials sector, which spiked by over two per cent this day.

Let us look at these TSX material stocks and learn more about them.

New Gold Inc (TSX: NGD)

New Gold produced 68,101 gold (Au) ounces, 109,511 silver (Ag) ounces and 8.2 million pounds of copper (Cu) in Q1 FY2022. The mid-cap gold miner reported revenue of US$ 174.7 million in the latest quarter, higher than US$ 164.9 million in  Q1 FY2021.

NGD stock rose by over eight per cent on Monday. However, this gold stock slipped by about 33 per cent in 52 weeks. As per Refinitiv, New Gold breached its support levels in April and fell significantly below C$ 2, with a Relative Strength Index (RSI) of 43.18 on July 4.

Wesdome Gold Mines Ltd (TSX: WDO)

Wesdome Gold posted a production increase of 13 per cent year-over-year (YoY) to 25,611 ounces of gold in Q1 2022. The C$ 1-billion market cap company reported a revenue surge of 45 per cent to C$ 66.7 million in the latest quarter. Furthermore, the gold firm noted a net profit of C$ 7.06 million in Q1 2022, nearly consistent with C$ 7.1 million in Q1 2021.

WDO stock zoomed by about seven per cent on July 4 and recorded a nine-month gain of nearly 17 per cent. According to Refinitiv findings, WDO had an RSI of 45.45 on July 4, with daily trade volume in green.

Bottomline

Prices of an underlying commodity could notably impact stocks like New Gold and Wesdome. However, a key detail to note is their financials. These TSX gold companies saw revenue growth in their latest quarter. Additionally, both companies are midcap and had debt-to-equity ratios below one, which is considered safe.

Please note, the above content constitutes a very preliminary observation based on the industry, and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.