- Barrick mines are expected to produce at least 500,000 ounces of gold annually for the next 10 years.
- Newmont produced 8 million ounces of gold and generated US$3.5 billion in free cash flow (FCF) in 2020.
- Franco-Nevadahas paid all its long-term debt by the end of FY 2020. It also has registered consistent revenue growth over the last four years.
Although gold prices have been declining this year, the stocks continue to draw considerable attention. The yellow metal is considered for stability and often held as reserved assets by governments to trade on them during economic hardship.
In 2020, though, gold recorded a 24% return, the highest since 2010.
Gold stocks rallied as investors turned their attention on stable, long-term value assets amid a stock market boom driven by technology stocks.
Thus, 2020 proved to be a fruitful year for the gold scrips. Gold stocks are companies that are directly involved in the mining and selling of yellow metal.
We explore here three gold stocks to learn about their performance over the past year.
Barrick Gold Corp. (NYSE: GOLD)
Barrick has vast gold and copper mines. It has recently seized control of its Porgera goldfield after allowing Papua New Guinea (PNG) to acquire a majority stake in the mine.
Barrick Niugini Ltd. will have a 49% stake, while PNG will get 51% ownership in Porgera.
According to the company, its mines are expected to produce at least 500,000 ounces of gold annually for the next 10 years. As a result, its “all-in sustaining costs” is likely to decline from US$1,000 per ounce in 2020 to around US$800 per ounce by 2025.
Barrick stock had crossed a 200-day moving average of US$24.46 on May 17, 2021. The stock was trading at US $24.26 at the market close on Tuesday, 0.75% from the previous session.
Also Read: 10 Dividend Stocks To Explore In June
Newmont Corp. (NYSE: NEM)
Newmont is a major gold supplier in the world and runs mines in multiple countries. It also produces copper, silver, and zinc. The 2020 lockdowns had been a major setback for the company, although it improved in revenue growth year over year.
Newmont’s EPS was US$3.19, and its annualized dividend was US$2.20.
It produced 8 million ounces of gold and generated US$3.5 billion in free cash flow (FCF), giving it a solid financial position to undertake various operations in 2021.
The Newmont stock was priced at $73.95 at the market close on Tuesday, 0.64% from the previous closing price. The stock gained 17% YTD.
Franco-Nevada is a gold streaming and royalty company. These companies make agreements with mining firms to buy their produce at a predetermined price. Hence, the seller would earn even when the price is low.
Franco-Nevada has paid all its long-term debts by the end of FY 2020. It also has registered consistent revenue growth over the last four years.
It logs an annual dividend of 0.52% and pays a yearly dividend of US$0.78. The company has stakes in some of the world’s largest mines.
The stock was trading at US$149.23 at the market close on Tuesday, down 0.25% from the previous closing price. The stock gained 13% YTD.