There always has been a degree of scorn from Wall Street and so-called investment professionals for those that invested in gold. They are laughed at as “gold bugs.” The argument against the precious metal, which is one of the largest financial assets in the world, and central banks have been loading up on it, is that typically it is not really a tradeable investment. Warren Buffett owns zero and has said in the past that it is an investment with “no utility.”
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The argument for gold and gold miners is twofold, in that the precious metal can provide a strategic hedge against inflation, and some of the top miners also mine silver and other needed commodities that are used in industrial applications. One thing is for sure. From a technical standpoint, there could be a massive breakout to the upside as spot gold is trading through the downtrend line from highs printed back in March.

We screened our 24/7 Wall Street commodity database looking for the top miners and royalty companies that are rated Buy and pay dependable (and in some cases big) dividends. The following six top stocks make the cut. While all are rated Buy at top Wall Street firms, it is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

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. The stock has been crushed as gold has sold off last year’s highs. And with a surge of inflation, you can bet many savvy portfolio managers are ready to add back top companies like this. Agnico Eagle has declared a cash dividend every year since 1983.

Shareholders receive a 3.29% dividend. BofA Securities has set a $57 price target. However, the Wall Street consensus target on Agnico Eagle Mines stock is much higher at $86.66. Shares closed on Friday over 2% higher at $48.70.

Barrick Gold

This is another top gold stock, and it still offers a solid entry point. Barrick Gold Corp. (NYSE: GOLD) and Randgold Resources completed their merger on January 1, 2019. This created the world’s largest gold company in terms of production, reserves and market capitalization.
Barrick holds a 50% interest in the Veladero mine located in the San Juan Province of Argentina; 50% interest in the KCGM, a gold mine located in Australia; 95% interest in Porgera, a gold mine located in Papua New Guinea; 50% interest in the Zalda­var, a copper mine located in Chile; and 50% interest in the Jabal Sayid, a copper mine located in Saudi Arabia.
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The company also owns gold mines and exploration properties in Africa and gold projects located in South America and North America. It also has a strategic cooperation agreement with Shandong Gold Group.

Investors receive a 3.35% dividend. Barrick Gold has a $23 price target at Raymond James. That compares with the $21.17 consensus target and Friday’s close at $16.44 a share.

B2Gold

This is a small-cap gold stock for aggressive investors looking for sector exposure. B2Gold Corp. (NYSE: BTG) operates as a gold producer with three operating mines: the Fekola Mine in Mali, the Masbate Mine in the Philippines and the Otjikoto Mine in Namibia.

The company also has a 25% interest in Calibre Mining and approximately 19% interest in BeMetals. In addition, it has a portfolio of other evaluation and exploration assets in Mali, Uzbekistan and Finland.

The BofA Securities team remains bullish on the small-cap miner and noted recently that results missed their consensus as production was pre-reported, and costs were slightly above expectations. Operating guidance for 2022 was reiterated, implying a very strong fourth quarter of 2022 both on production and cash costs. In addition, a process to sell Gramalote will be initiated before the year is out. Lastly, the company reported the results of the Fekola Complex study expected in the second quarter of 2023.

B2Gold stock comes with a 4.47% dividend. The BofA Securities price target is $4, while the consensus target is $4.92. Shares most recently closed at $3.58.

Kinross Gold

Investors who are more aggressive may want to consider this smaller cap mining company. Kinross Gold Corp. (NYSE: KGC) engages in the acquisition, exploration and development of gold properties principally in Canada, the United States, the Russian Federation, Brazil, Chile, Ghana and Mauritania.

The company is also involved in the extraction and processing of gold-containing ores, reclamation of gold mining properties and the production and sale of silver.

Kinross returned approximately $300 million of capital to its shareholders year to date through its enhanced share buyback and quarterly dividend programs, or approximately $0.23 per share. Full-year return of capital is expected to be approximately $450 million. Since launching an enhanced share buyback program in September, the company has repurchased approximately $180 million in shares, or 60%of the $300 million planned for 2022.

The dividend yield here is 2.78% dividend. The $7.50 Raymond James price target is well above the $5.51 consensus target and Friday closing price for Kinross Gold stock of $4.31.

This is one of the largest mining companies and a solid buy for investors who are more conservative. Newmont Corp. (NYSE: NEM) is engaged in the production of gold.
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Its North America segment consists primarily of Carlin, Phoenix, Twin Creeks and Long Canyon in Nevada and Cripple Creek and Victor in Colorado. The South America segment consists primarily of Yanacocha in Peru and Merian in Suriname. The Australia segment consists primarily of Boddington, Tanami and Kalgoorlie in Australia. The Africa segment consists primarily of Ahafo and Akyem in Ghana.

Shareholders receive a 4.73% dividend. BofA Securities has a $64 price objective. The consensus target is $53.57 and Newmont stock closed on Friday at $46.53.

Wheaton Precious Metals

This precious metals royalty stock makes good sense for more conservative investors who are 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, and then sells the silver and gold into the open market.

Wheaton Precious Metals stock investors receive a 1.58% dividend. The Raymond Janes price target of $52 compares with a $50.71 consensus target. The stock closed at $37.99 on Friday.

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The SPDR Gold Trust (NYSE: GLD) exchange-traded fund is perhaps one of the best pure plays on gold for investors. The trust that sponsors the fund holds physical gold bullion, as well as some cash. Each share represents one-tenth of an ounce of the price of gold. Note though that the fund does not pay a dividend.

Proper asset allocation should always include at least a single-digit percentage holding of precious metals like gold and silver. Not only does gold hedge inflation, but the sector has been stagnant most of the year. With inflation still way above the Federal Reserve target of 2%, continued demand from central banks and worried investors could drive the prices much higher in the fourth quarter and in 2023.

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