This year has been an interesting year, to say the least. Between COVID, geopolitical trade wars, and environmental catastrophes, investors feel more uncertain about the future than in previous years. With these factors swaying stock market prices, many investors have turned to gold stocks.
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When turmoil hits world economies, investors often turn to gold as both an investment and a store of wealth. Investing in gold can be done in a few ways. While buying gold bullion may be out of the question for some, gold stocks and gold ETFs are much more accessible for many investors.
In the U.S., the government has given out trillions of dollars to help stimulate the economy. And while we don’t know what the effect of this will be in the long term, in the short term there may be some investment opportunities to capitalize upon.Gold Stocks to Watch: Gold Stock Focus: Freeman Gold Corp.
Freeman Gold Corp. (FMAN Stock Report) is a mining exploration company that is focusing on developing and producing mineral extracts across North America. The company has been working to gain a strong foothold in the U.S. gold mining industry. Within the U.S., Freeman has been focused specifically on mining gold in Idaho. While Idaho is notable for its agricultural production, the state is also one of the most prominent locations for gold mining in the world.
In 2019, the Fraser Institute ranked Idaho No. 3 in North America for its mining attractiveness. In addition, Idaho ranks as No. 8 in the world on the same index. The company recently finished its acquisition of Lower 48 Resources LLC., which will give it access to the well-known, Lemhi Gold Project located in Lemhi County, Idaho.
This project comes with 99 unpatented claims and 11 patented claims. These claims have over 10,000 meters of previously drilled mines. With these 99 claims, 53 are directly owned by Lower 48, and the other 46 options claims are held via an agreement with BHLK-2 LLC. With this in mind, Lower 48 has a 100% interest in those claims contingent upon paying $1,000,000 to BHLK over a 7-year time frame.Freeman Gold Announces Big News With Yamana Gold Inc.
On September 8th, Freeman announced that it had completed an acquisition for a back-in-right from Yamana Gold Inc. (YRI Stock Report) (AUY) The back-in-right pertains to the Lemhi Project where Yamana is now a 5% shareholder of Freeman.
Will Randall, President and CEO of Freeman Gold, stated that “we are delighted to welcome Yamana as a 5% strategic shareholder. Having a major gold producer with Yamana’s caliber take a significant position in our Company is a major vote of confidence in the project and the team we have assembled. We hope to work together over the coming months and years.”
In this deal, Freeman Gold has issues 4,035,273 common shares to Yamana, representing 5% of the outstanding shares of Freeman Gold. With Yamana’s gold expertise, Freeman will gain access to a strategic shareholder with years of experience in the gold mining industry. In response to this deal, AUY stock climbed to just over $6 during midday trading on September 8th. Similarly, FMAN stock is up over 13% reaching highs of CA$0.60 so far this week.Gold Stocks to Watch: Is Barrick Gold Corp. Worth Watching at Its Current Valuation?
Barrick Gold Corp. (ABX Stock Report) (GOLD), is one of the top mining stocks on the NYSE. So far in 2020, GOLD stock is up as much as 60%. At its current price of just under $30 as of September 8th, many investors believe that GOLD stock could be slightly overvalued. Despite this, Barrick Gold’s Q2 report showed a great deal of momentum. In its second-quarter report, Barrick Gold showed revenue north of $3 billion. This represents an almost 50% increase from the same quarter of the previous year.
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On August 10th when it announced its earnings, Barrick gold stock briefly shot up to just shy of $40 before consolidating. In addition to a positive earnings report, Barrick Gold also increased its dividends to around 14% or $0.08 per share. While Barrick Gold stock does have a lot going for it, the company has had to overcome losses from a few unprofitable mining operations.
Barrick stated that its goal is to bring its debt from $1.3 billion as of its second quarter report, down to zero by the end of this year. In addition, Barrick Gold aims to produce roughly 4.8 million ounces of gold for the 2020 year. At a forward price to earnings ratio of 43, its valuation remains quite expensive according to some analysts. But, with its mining potential and debt reduction, Barrick gold stock could prove attractive.Gold Stocks to Watch: Hecla Mining Company Is Showing Solid Momentum
Hecla Mining Company (HL Stock Report) is one of around 200 basic materials stocks. When it comes to these stocks, investors should always be looking for the top performer in the industry. In the case of Hecla Mining, the company works in the extraction and production of several precious and base metals. Although it does produce lead, zinc and other base metals, investors often classify Hecla Mining as a precious metals stock.
The company produces both unrefined gold and silver bullion which are then sold to those who trade precious metals. Based out of Coeur d’Alene, Idaho, Hecla has a unique and advantageous position in the mining industry. The company reportedly has a 100% interest in several key mining locations around North America. This includes the Greens Creek mine in southern Alaska; then Casa Berardi mine in northern Quebec; the San Sebastian mine in Mexico and several others.
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Founded in 1891, Hecla Mining has a long history in then exploration of new and existing mines around North America. HL stock has received a lot of attention for the company’s contracts with the Federal Reserve. Since the beginning of the 2020, the Feds have given almost $3 trillion to Hecla which is no small feat. The company has stated that it expects to see a 23% increase in revenue in the 2021 fiscal year. Although analysts expect the company to post a loss in 2020, analysts believe the real potential for Hecla could be in the long term.Gold Stocks to Watch: The Case for Gold Fields Limited
Gold Fields Ltd. (GFI Stock Report) is one of the largest gold mining firms in the world. Based out of South Africa, Gold Fields has several mining projects in different areas of the world. This includes mines in its home country of South Africa as well as in Australia, Chile, Peru and Ghana. Within these countries, it has nine mines that are currently operational, producing roughly 2.2 million ounces of gold per year. In addition, Gold Fields has as much as 51.3 million ounces of gold mineral reserves.
Although it does mine other resources such as copper, the company is primarily focused on the extraction and production of gold. On August 20th, Gold Fields announced that investors could purchase options with an expiration date of April 2021. The contracts started trading at a $12 strike price with a bid amount of $0.40. This gives investors the opportunity to buy Gold Fields if they believe it will go up in that time frame.