It’s hard to believe it has been almost seven years since gold topped out at over $1,900 an ounce. Incredibly, it has taken almost that long for all the companies that overleveraged back then to get their balance sheets back in order so they can make money on gold and silver at current trading levels.

While there is always a group of super gold bulls around, the reality is the price may stay range bound, so it makes sense to look for the companies in the best shape.

In new research, Deutsche Bank actually thinks that gold could fade from the current spot price of $1,325 to $1,238 later this year. The report noted this when discussing themes for the sector:

Key themes for the sector largely center on the use of cash flow; with a sector that invested very little in greenfield and brownfield projects over the past 5 years, companies must now decide on the split of capex/exploration/dividends/buybacks/further debt reduction/M&A opportunities, which will require sensible decisions from company management teams. The other key theme for the industry relates to cost inflation with a number of companies indicating some headwinds are returning.

The analysts are positive on three top-pick companies, all of which make sense for investors looking for precious metals exposure.

Barrick Gold

This stock is one of the top companies in the sector and sold off recently providing a solid entry point. Barrick Gold Corp. (NYSE: ABX) is the world’s largest gold producer. Its reserve position is similarly large, totaling 86 million ounces of proven and probable reserves. The development of the Goldrush property in Nevada should provide another world-class asset to its portfolio.

The company has worked hard this year to deleverage the balance sheet and asset optimizations and digitization have been implemented to lower costs. Through its large reserve base, slew of development assets and no hedging, the company offers investors a big exposure to gold.

Investors are paid a small 0.71% dividend. The Deutsche Bank price target for the stock is $15, and the Wall Street consensus target is $16.35. The shares traded Friday morning at $12.25.

Pan American Silver

This is another top pick that doesn’t get the coverage on Wall Street some of the bigger companies do. Pan American Silver Corp. (NASDAQ: PAAS) is one of the largest primary silver producers in the world, with mines located in Bolivia, Mexico, Peru and the world-class Navidad silver project located in Argentina. It is also a producer of lead, zinc, copper and gold.

The company reported an earnings miss on higher unit production costs, while also announcing a 40% increase in the dividend. Thanks largely to the 2017 acquisitions of Joaquin and COSE, year-end 2017 silver reserves were 1% higher year over year.

Deutsche Bank stays positive on the company and noted this in the report:

Beyond La Colorada and Dolores expansions, we believe Pan American Silver has a range of interesting organic projects, which we think could be beneficial to the company over time, such as the development of Joaquin and COSE projects to extend the mine life at Manantial Espejo. The company has a net cash position, is post peak capex and production and costs should continue to improve out to 2020.

Investors receive a 0.9% dividend. Deutsche Bank has a $19 price target, while the consensus target is $20.40. The shares traded at $15.4o on Friday.

Wheaton Precious Metals

This precious metals company makes good sense for more conservative accounts looking to have exposure to the sector. Wheaton Precious Metals Corp. (NYSE: WPM) is a Canadian based, precious metals streaming company with approximately 60% of its revenues from the sale of silver and 40% from gold.

Under the terms of long-term contracts, the company purchases silver and gold from a variety of mines, including Goldcorp’s Penasquito mine in Mexico, Vale’s Salobo mine in Brazil, Lundin Mining’s Zinkgruvan mine in Sweden, and Glencore’s Antamina and Yauliyacu mines in Peru, then sells the silver and gold into the open market.

The analysts noted some positive development at the company recently:

At San Dimas, a change in ownership recently occurred (from Primero to First Majestic Silver) and the stream agreement was slightly revised (WPM now will receive 25% of gold production, in addition to 25% of silver production converted to gold at a fixed gold/silver exchange ratio of 70:1). Wheaton Precious Metals will pay First Majestic the lower of $600 an ounce or the prevailing market price. We believe this is a positive outcome at the mine after months of uncertainty.

Shareholders are paid a 1.83% dividend. The $27 Deutsche Bank price target compares with the $26.27 consensus target. The stock was last seen trading at $19.65 a share.

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Proper asset allocation should always include a single-digit percentage holding of precious metal like gold and silver. Not only do they hedge over the long term, they can really help if the market does go into correction or bear market mode, as they tend to trade inverse to markets.

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