We recently published a list of 10 Best Gold Stocks Under $30. In this article, we are going to take a look at where Barrick Gold Corporation (NYSE:GOLD) stands against other best gold stocks under $30.
Gold mining is a global industry that operates on every continent except Antarctica, and gold is produced from mines of vastly varied forms and scales.
Gold has traditionally been used as a hedge against inflation and unstable economies. As per Joseph Cavatoni, senior market strategist of the World Gold Council, “Gold does well in moments of risk. If you look at market drawdowns or systemic events in the market, that’s when gold really shines.” Cavatoni suggested new investors choose between investments like gold-backed ETFs and real gold, which requires concerns like purity and storage. While real gold requires close attention to pricing and liquidity, exchange-traded funds (ETFs) provide accessibility and are frequently commission-free.
Gold prices have risen by more than 30% in October 2024, reaching a record-breaking high, boosted by the Federal Reserve’s recent half-point rate drop, geopolitical tensions, and economic uncertainties surrounding the US presidential election. China, India, and Turkey’s central banks have supported the price rise by lowering their reliance on the US currency, while the renowned retail giant Costco’s launch of 1-ounce gold bars has raised gold’s accessibility for individual investors.
According to David Meger, director of metals trading at High Ridge Futures, the heightened tensions between Russia and Ukraine are likely the most significant geopolitical factor influencing the gold market during the past several days.
Investors have witnessed financial gains as the global gold mining industry of the broader market has grown by 18.29% since the beginning of the year and by 31.29% in the past year. Meanwhile, the World Gold Council reports that record prices and strong investment flows helped drive a 5% year-over-year (y/y) growth in gold demand to 1,313 tonnes (t) in Q3 2024. The average LBMA gold price increased 28% yearly to a record $2,474 per ounce.
For the seventh straight quarter, OTC investment nearly quadrupled to 137 tonnes. Demand for technology-related gold increased 7% year over year to 83 tonnes, propelled by AI breakthroughs. While recycled gold volumes rose 11% year over year, mine production jumped 6% year over year to a record 990 tonnes, and no widespread distress selling was seen.
Demand was significantly increased by the recovery in ETF inflows, which reached 95 tonnes. Key drivers included portfolio diversification, geopolitical uncertainties, and declining interest rates. Despite a 9% year-over-year reduction brought on by market-specific variables, bar and coin investment stayed strong at 269 tonnes.
The projection for 2024, as per the World Gold Council, calls for healthy professional flows and consistent bar and coin investment to offset slowing central bank buying and declining consumer demand.
On the other hand, as per Bloomberg, on November 21, 2024, Samantha Dart, co-head of Global Commodities Research at Goldman Sachs, stated central bank purchases are raising the price of gold. She forecasts that the price of gold will reach $3,000 per ounce by the end of 2025.
Our Methodology
For this article, we first used a Finviz stock screener to list down all the gold stocks trading under $30 (as of the writing of this article) with over 40% institutional ownership. From the resultant dataset, we chose the 10 best gold stocks with the highest upside potential. The stocks are ranked in ascending order of their upside potential as of November 18.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here)
A miner examining yellow gold ore in a mine shaft, symbolizing the company’s exploration process.
Barrick Gold Corporation (NYSE:GOLD)
Upside potential as of November 18: 37.86%
Share Price as of November 18: $17.02
Based in Toronto, Barrick Gold Corporation (NYSE:GOLD) is one of the world’s leading gold producers, making it one of the best gold stocks under $30. The company produced over 420 million pounds of copper and nearly 4.1 million attributable ounces of gold in 2023. By the end of 2023, Barrick had substantial copper reserves and around 20 years’ worth of gold reserves. It now has mines in 19 countries across the Americas, Africa, the Middle East, and Asia after purchasing Randgold in 2019 and merging its Nevada operations into a joint venture with rival Newmont later that year.
Barrick Gold Corporation (NYSE:GOLD) has a proven track record of exploration success and a clear runway, as evidenced by the 10-year business plans or even 15- and 20-year plans for several of its mines. Barrick has maintained the highest gold reserve grade among its peers by achieving unmatched reserve base growth. Furthermore, since year-end 2019, the company has replaced approximately 140% of mined gold reserves organically, adding nearly 29 million ounces of attributable, established, and probable reserves.
As of right now, the company is expected to have a successful year-end. The revenue increased 18% year over year in Q3. While copper production increased by 12% from quarter to quarter, gold production remained consistent with the prior quarter. Compared to the previous year, net earnings per share increased by 33%. Barrick Gold Corporation (NYSE:GOLD) anticipates a successful Q4 due to higher grades at Kibali, higher production at Nevada Gold Mines, and the acceleration of the Pueblo Viejo plant project.
Jefferies maintained a Buy rating on Barrick Gold Corporation (NYSE:GOLD) shares and increased their price target from $24 to $28 on October 5, 2024. The firm, which believes gold can continue to rise in the near future, observed that rather than falling down, gold has been trading with greater torque to falling real rates. The company has raised its goals for the metals and mining stocks it covers by an average of 13% and revised its view for commodity prices.
Overall, GOLD ranks 4th on our list of best gold stocks under $30. While we acknowledge the potential of GOLD, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than GOLD but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.