Rua Gold Inc. (TSXV: RUA, OTC: NZAUF, WKN: H8E)
An Emerging Gold Explorer with Two Highly Prospective Land Packages in New Zealand’s historical gold fields.
To hedge against a series of risks, including the depreciation of the U.S. dollar, inflation and geopolitics conflicts, investors have turned their attention to the precious metals this year. And investing in companies engaged in the exploration, mining and production of gold and silver can diversify portfolios while helping to preserve value in a falling stock market.
In fact, some analysts are suggesting that a new commodity super cycle may have just begun. If you approve the saying, here are three no-brainer precious metals stocks to buy.
Wheaton Precious Metals (NYSE:WPM) is a streaming company based in Vancouver, Canada. The company’s business model is unique, which is not directly involved in the mining activities or production of minerals, but rather provides upfront financing to miners in exchange for ownership of a portion of the metals produced.
With a focus on physical gold and silver, Wheaton’s business model is less risky than that of traditional precious metals producers, as there is no operational or capital expenditure risk. The company can earn high profits by entering into purchase agreements to acquire precious metal assets at a discount and then sell them on the open market at market price.
In the first quarter of fiscal 2024, the company’s revenues rose 38 per cent year-on-year to $297 million, while net income surged 47 per cent year-on-year to $164 million, or $0.36 per share, according to the earnings report. As of 31 March 2024, the company had 38 long-term purchase agreements in place. Wheaton stock is expected to climb higher in 2024 as gold and silver prices are expected to remain at elevated levels for the rest of the year.
Harmony Gold Mining (NYSE:HMY) stock is up nearly 50% year-to-date, driven by higher gold prices and strong earnings in fiscal 2023. While South Africa’s gold producers have struggled in recent years, the company’s profitability has been accelerating. As South Africa’s largest gold producer, Harmony not only has operations in several parts of the country, but also has mining operations in Australia and Papua New Guinea.
As a gold miner, the company has directly benefited from rising gold prices this year. Abundant reserves and ongoing exploration activities provide a solid foundation for future growth. In addition, the company has demonstrated resilience in the face of rising interest rates and challenging macroeconomic conditions.
In FY2023, Harmony produced 1.46 million ounces of gold. Despite high inflationary pressures, the company effectively controlled costs and also generated significant free cash flow from operations, with overall earnings significantly above 2022 levels. With the commodity supercycle is beginning, this gold stock is clearly well-positioned to dominate the next decade.
SPDR Gold Trust (NYSEARCA:GLD) is the world’s largest physical gold exchange-traded fund (ETF). 2024 has seen the fund’s price rise 14% so far, as investors remain concerned about inflation and the broader global economic growth outlook. Gold has been tested for thousands of years as a means of storing wealth and has proven to be a unique safe-haven asset.
The ETF tracks the price of gold by holding physical bullion in secure vaults, accumulating 26.7 million ounces of gold, equivalent to about 832 tonnes of bullion. As the U.S. dollar weakens, the price of gold typically rises, driving the value of the fund up as well, making it one of the safest precious metals stocks to own in 2024.
