24/7 Wall St. Insights
- Gold hit an all-time high in late September and could be going much higher.
- Demand from global central banks has been a driving force behind the huge gold run.
- Sit back and let dividends do the heavy lifting for a simple, steady path to serious wealth creation over time. Grab a free copy of “7 Things I Demand in a Dividend Stock,” plus get our two best dividend stocks to own today. Access 2 legendary, high-yield dividend stocks Wall Street loves.
Dividend stocks are a favorite among investors for good reason. They provide a steady income stream of passive income and offer a promising avenue for total return. Total return, a comprehensive measure of investment performance, encompasses interest, capital gains, dividends, and distributions realized over time.
Let’s take a closer look at the concept of total return. Imagine you purchase a stock at $20 that offers a 3% dividend. If the stock price rises to $22 within a year, your total return is 13%. This is calculated by adding the 10% increase in stock price to the 3% dividend.
Gold’s incredible run over the last year has been nothing less than amazing, and many analysts feel there is room for the legacy commodity to continue its historic climb. The recent surge in gold prices is due primarily to the U.S. Federal Reserve’s recent decision to cut interest rates. The Fed announced a 50-basis-point reduction, which has set the stage for potential further cuts, including another half-point by year’s end.
Top Wall Street analysts have also cited massive buying of gold by central banks worldwide, which is currently much higher than the five-year average. When you add a weakening U.S. dollar, concerns over inflation, geopolitical concerns, and continued significant demand from retail investors, the path of least resistance appears to be higher. Don’t forget the anecdotal evidence of massive gold demand at retail giant Costco.
We screened our 24/7 Wall St. commodity research database, looking for gold-mining stocks that pay big and reliable dividends. Five companies look like outstanding ideas now; all are rated Buy at the top firms we cover.
Why do we cover gold stocks?
Proper portfolio asset allocation should always include at least a single-digit percentage holding of precious metals like gold and silver. Not only can they hedge inflation, which, while currently lower, is still much higher than Federal Reserve targets, but they can also help if the market goes into correction or bear market mode, as they tend to trade inversely to markets.
Barrick Gold
This stock is a top contender in the sector, offering a promising entry point and a solid 2% dividend. Barrick Gold Corp. (NYSE: GOLD) and Randgold Resources completed their merger on Jan. 1, 2019, propelling them to the forefront as the world’s largest gold company in terms of production, reserves, and market capitalization.
The company owns:
- 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
- 50% interest in the Jabal Sayid, a copper mine located in Saudi Arabia
Barrick also owns gold mines and exploration properties in Africa and projects in South America and North America. It has a strategic cooperation agreement with Shandong Gold Group.
B2Gold
For those seeking high returns, this small-cap stock offers an exciting opportunity for sector exposure and pays a big 4.73% dividend. B2Gold Corp. (NYSE: BTG) is a dynamic gold producer with three mines in Mali, the Philippines, and Namibia.
It also operates 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 Corp. and approximately 19% interest in BeMetals Corp. In addition, it has a portfolio of other evaluation and exploration assets in Mali, Uzbekistan, and Finland.
Caledonia Mining
Investors receive a strong 4.13% dividend, and this stock could be poised to double from current trading levels. Caledonia Mining Corp. PLC (NYSE: CMCL) primarily operates a gold mine. It also explores and develops mineral properties for precious metals.
The company holds a 64% interest in the Blanket Mine, a mine located in Zimbabwe.
It also owns 100% interests in:
- The Maligreen project, a brownfield gold exploration project located in the Gweru mining district in the Zimbabwe Midlands
- The Bilboes, a gold deposit located to the north of Bulawayo, Zimbabwe
- Motapa, a gold exploration property located in Southern Zimbabwe.
The company posted solid second-quarter gross revenues of $50.1 million, compared to $37.0 million in the second quarter of 2023, due to higher gold production and a higher price.
In addition, the gross profit was $22.9 million, a 109.8% increase from $10.9 million in Q2 2023, due to higher gold revenue and lower production costs.
DRDGOLD
While off the radar, this is another small-cap mining gem that pays a strong 2.23% dividend. DRDGOLD Ltd. (NYSE: DRD) is a mining company that engages in the surface gold tailings retreatment business in South Africa.
It also involved exploration, extraction, processing, and smelting activities. The company recovers gold from surface tailings in the Witwatersrand basin in Gauteng province. It was formerly known as Durban Roodepoort Deep and changed its name in 2004.
DRDGOLD is steadfast in its commitment to conducting profitable business that creates value for all stakeholders in the short, medium, and longer term. The company actively seeks synergies between its financial, human, social, natural, and manufactured aspects, demonstrating its dedication to sustainable growth and value creation.
Newmont
This is the largest mining company, yielding a solid 1.85%, and is a timely buy for more conservative accounts. Newmont Corp. (NYSE: NEM) is a mining giant that produces gold.
It operates through the following geographical segments:
- North America
- South America
- Nevada
- Australia
- Africa
The North American segment consists primarily of:
- Carlin, phoenix, Twin Creeks, and Long Canyon in the state of Nevada
- Cripple Creek and Victor in the state of Colorado
The South American segment consists primarily of Yanacocha in Peru and Merian in Suriname.
The Australia segment consists mainly of Australia’s Boddington, Tanami, and Kalgoorlie.
The Africa segment consists primarily of Ahafo and Akyem in Ghana.
Five New Stocks Under $10 That Pay Huge Ultra-Yield Dividends of 10% and More
Investors looking to invest in physical gold holdings should consider SPDR Gold Shares ETF (NYSE: GLD), one of the best pure plays on gold for investors. The trust that sponsors the fund holds physical gold bullion and some cash. Each share represents one-tenth of an ounce of the price of gold. The fund does not pay a dividend.
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