For years after gold rolled over in the fall of 2011, there was always a cadre of so-called sophisticated investors that sneered at the “goldbugs,” laughing that gold had no place in portfolio asset allocation and people that owned it were wasting their time and money in the process. Here’s a gigantic newsflash: they aren’t laughing now.

24/7 Wall St. has always advocated for at least a single-digit percentage position in the precious metal, as it provides a hedge against exactly what we are witnessing now. With many investors scared to look at their brokerage statements, even a 5% holding would have mitigated some of the damage done in the market sell-off.

A new report from Michael Jalonen and the commodities team at Merrill Lynch includes a raised 18-month price target on gold to a stunning $3,000 per ounce for the 2020 to 2022 period. The current spot price is $1,706. That would represent a stunning 75% move from current levels. Also, eight gold stocks were rated Buy, and here we feature the firm’s top three picks, as well as two others that are large-cap leaders in the sector. All are of course rated Buy.

It’s important to remember, the SPDR Gold Shares (NYSE: GLD) is an outstanding vehicle for investors not looking to buy gold mining companies, as you literally buy physical gold.

Agnico Eagle Mines

This is one of Wall Street’s most preferred North American gold producers. Agnico Eagle Mines Ltd. (NYSE: AEM) is a senior Canadian gold mining company that has produced precious metals since 1957. Its eight mines are located in Canada, Finland and Mexico, with exploration and development activities in each of these regions, as well as in the United States and Sweden.

The company and its shareholders have full exposure to gold prices due to its long-standing policy of no forward gold sales. Agnico Eagle has declared a cash dividend every year since 1983.

The company’s Meadowbank complex in Nunavutis is expected to achieve commercial production very soon, and the Amaruq project was expected to ramp up to full production by late last year. Amaruq’s gold output is forecast to rise from 130,000 ounces in 2019 to 351,000 ounces in 2021, and it could account for 17% of Agnico Eagle’s total output.

Shareholders receive a 1.49% dividend. The Merrill price target for the shares is $62, and the Wall Street consensus target is $58.72. Agnico Eagle Mines stock closed on Tuesday trading at $53.80.

B2Gold

This is a small-cap gold stock for aggressive investors looking for sector exposure, and it is one of the three top picks at Merrill. B2Gold Corp. (NYSE: BTG) is a global, growth-oriented mid-tier gold producer whose primary assets include gold mines located in Nicaragua (La Libertad and El Limon), the Philippines (Masbate) and Namibia (Otjikoto) and Mali (Fekola).

The company recently announced positive drill results from the Mamba zone, which is located within the Anaconda area approximately 20 kilometers from the Fekola Mine, as well as positive infill drill results from the Fekola mineral resource area and step out results north of the Fekola resource.

Analyst estimates for the company have been rising. The first-quarter earnings estimate has been increased to $0.10 per share from $0.09, as have the full-year estimates for 2020 and 2021. The 2020 estimate has been increased to $0.41 per share from $0.37, and the full-year 2021 estimate has been scaled up from $0.32 to $0.35 per share.

Merrill has a $6.40 price target, which is well above the $3.50 consensus estimate. Shares were last seen trading at $4.57.

This is another top miner, and it is offering a very solid entry point. Barrick Gold Corp. (NYSE: GOLD) and Randgold Resources completed their merger on January 1, 2019, which created the world’s largest gold company in terms of production, reserves and market capitalization.

In the first quarter, gold production and sales were 1.25 million ounces and 1.22 million ounces, respectively. Copper production and sales amounted to 115 million pounds and 110 million pounds, respectively. Average market price for gold was $1,583 per ounce and the same for copper was $2.56 per pound. Realized copper price for the first quarter is expected to be 12% to 14% lower than the average market price due to provisional pricing adjustments. Further, the company expects gold costs to be similar to fourth-quarter 2019 levels.

The company stated recently that it is well positioned to achieve its full-year guidance despite the impact of the coronavirus pandemic and consequent lockdowns. Barrick is scheduled to release first-quarter 2020 results on May 6, before the opening bell.

The $30 Merrill price target compares to a $24.28 consensus target. Barrick Gold stock ended Tuesday at $24.82 a share.

Newmont

This is one of the largest mining companies and a solid buy for more conservative accounts. Newmont Corp. (NYSE: NEM) is a leading gold and copper producer. It employs approximately 29,000 employees and contractors, with the majority working at managed operations in the United States, Australia, Ghana, Peru, Indonesia and Suriname. Newmont is the only gold producer listed in the S&P 500 index.

In recent years, the company announced that “first gold” has been poured at its new mine, called the Merian gold mine, in Suriname in South America. It reported Merian contains gold reserves of 5.1 million ounces and that annual production is expected to average between 400,000 and 500,000 ounces of gold at competitive costs during the first five full years of production.

In keeping with its capital return objectives, Newmont announced a 79% hike in its quarterly dividend to $0.25 in February, effective the second quarter of 2020. The company has repurchased 12.4 million shares for $506 million, halfway to achieving its $1 billion share repurchase program. Approaching its centenary, the company has rebranded itself from Newmont Goldcorp to Newmont Corporation.

Shareholders of Newmont stock received a 0.95% dividend, but the increase this quarter represents a 1.68% yield. The Merrill price objective is $73. The $59.56 consensus target is near the most recent close at $59.27.

Wheaton Precious Metals

This precious metals royalty stock makes good sense for more conservative accounts looking to have exposure to the sector. Wheaton Precious Metals Corp. (NYSE: WPM) is a Canadian 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, the Lundin Mining Zinkgruvan mine in Sweden, and Glencore’s Antamina and Yauliyacu mines in Peru, then sells the silver and gold into the open market.

Shareholders receive a 1.14% dividend. Merrill has set a $44 price target. The consensus target is $36.16, and Wheaton Precious Metals stock closed at $35.01.

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We will continue to remind our readers that proper asset allocation should always include a single-digit percentage holding of precious metals like gold and silver. Not only does it have the potential to hedge inflation over the long term, but a position in gold can really help if the market does go into correction or bear market mode, which is where we are right now. Gold tends to trade inverse to markets.

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