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5 Gold Mining Stocks Under $10 That Are Buys Right Now
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Gold is staging a rebound after remaining in choppy waters in 2015. The yellow metal is getting its groove back, supported by a cocktail of factors including concerns over the global economy, dollar weakness and volatility in equities.
A Glittery Year for Gold So Far
The year 2015 had been a bumpy ride for gold with the shiny metal navigating an unsupportive macro environment. A strong dollar, slump in oil prices and the climb in U.S. equities led to a more than 11% fall in gold’s value last year. With the Federal Reserve finally ending an era of near-zero interest rates with the December lift-off, gold sank to six-year lows. A steep fall in prices also led to multibillion dollar write-downs by gold miners.
However, 2016 has been positive so far for the yellow metal. Gold has been the bright spot among precious metals with prices scaling higher roughly 21% year to date, making it the most attractive safe haven asset at present. Gold prices climbed to as high as $1,300 per troy ounce in May, the peak for the year so far.
In fact, gold has been the best performing asset this year, outperforming major equity indices, investment grade and high yield bonds and commodity indices. The spike in gold prices has also led to a surge in the share prices of many gold miners.
Gold prices got a boost in March 2016 after the Fed left benchmark interest rates steady (in the band of 0.25%-0.50%) and cut its short-term rate hike expectations to two quarter-point rises from the initial outlook of four hikes citing continued risk from an uncertain global economy and volatile stock markets. The outlook triggered a sharp fall in the U.S. dollar against a basket of rival currencies, leading to a spurt in gold prices.
Gold prices also got a lift recently after a weaker-than-expected U.S. job report faded all hopes of a Fed rate hike this month. The U.S. economy created a paltry 38,000 jobs in May, well below the consensus estimate of 203,000. The disappointing job report lowered the likelihood of a rate hike, which in turn augers well for gold.
A delay in raising interest rates elevates demand for gold, which produces no income but relies on price appreciation to lure investors. On the other hand, a hike in interest rates tends to boost returns from income generating assets and thus hits non-yielding commodities, including gold.
A host of factors also contributed to the recent rally in gold prices including a weakening greenback, slowdown in China, volatile equity markets and introduction of negative interest rates by several of the world’s central banks (including Japan) that have spurred safe-haven demand for gold.
Concerns about a potential British exit from the European Union are also supporting gold prices of late. Britain will vote whether or not to remain in the European Union on June 23. A potential “Brexit” would bring instability to Europe, which could send shockwaves through global stock markets.
Another factor that will act as a tailwind for gold is that the supply of the yellow metal has already reached peak levels as per reports. Lower gold prices in the past few years and cost pressure had restricted the ability of gold producers to invest in new projects. Production of gold is likely to decline by 3% in 2016, thus ending a seven-year stint of rising output. Moreover, gold prices should get support from retail demand in the second half of 2016, which is seasonally strong for top consumers like India and China.
5 Attractive Picks
Amid this favorable backdrop for bullion, it would be a prudent idea to zero in on some gold mining stocks that are trading at attractive prices and are good options for investment right now.
We have employed the Zacks Stocks Screener to find companies that sport a favorable Zacks Rank and are currently trading below $10. We highlight the following 5 cheap gold mining stocks that could be worth putting your money in. These top-ranked companies are well-placed to leverage the recent rebound in the gold market.
Vancouver, Canada-based B2Gold explores and develops mineral properties in Nicaragua, the Philippines, Namibia, Burkina Faso and Chile. The company primarily explores for gold, silver and copper.
The stock holds a Zacks Rank #1 (Strong Buy) and is currently trading at $2.06. The company has seen its shares shoot up around 102% year to date.
Pretium Resources Inc.
Vancouver, Canada-based Pretium acquires, explores and develops precious metal resource properties in the Americas. Its mineral interests consist of gold, copper and silver exploration projects.
Pretium sports a Zacks Rank #1 and is currently trading at $8.82. The stock has gained around 75% year to date.
Toronto-based IAMGOLD is engaged in the exploration, development and operation of gold mining properties. It also explores for copper and silver. The company holds interests in four operating gold mines, as well as exploration and development projects located in Africa, South America and Canada.
IAMGOLD holds a Zacks Rank #2 (Buy) and is currently trading at $3.88. The stock has gained a whopping 173% so far this year.
South Africa-based Harmony conducts underground and surface gold mining and is also engaged in related activities such as exploration, processing, smelting and refining.
The stock has a Zacks Rank #2 and is currently trading at $3.65. Harmony has seen its shares skyrocket roughly 293% year to date.
Pershing Gold Corporation
Lakewood, CO-based Pershing Gold engages in the exploration and mining of gold and precious metal properties mainly in Nevada. It focuses on the exploration of Relief Canyon properties covering an area of around 25,000 acres based in Pershing County in north western Nevada.
The company carries a Zacks Rank #2 and is currently trading at $4.33. The stock has gained roughly 23% year to date.
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5 Gold Mining Stocks Under $10 That Are Buys Right Now
Gold is staging a rebound after remaining in choppy waters in 2015. The yellow metal is getting its groove back, supported by a cocktail of factors including concerns over the global economy, dollar weakness and volatility in equities.
A Glittery Year for Gold So Far
The year 2015 had been a bumpy ride for gold with the shiny metal navigating an unsupportive macro environment. A strong dollar, slump in oil prices and the climb in U.S. equities led to a more than 11% fall in gold’s value last year. With the Federal Reserve finally ending an era of near-zero interest rates with the December lift-off, gold sank to six-year lows. A steep fall in prices also led to multibillion dollar write-downs by gold miners.
However, 2016 has been positive so far for the yellow metal. Gold has been the bright spot among precious metals with prices scaling higher roughly 21% year to date, making it the most attractive safe haven asset at present. Gold prices climbed to as high as $1,300 per troy ounce in May, the peak for the year so far.
In fact, gold has been the best performing asset this year, outperforming major equity indices, investment grade and high yield bonds and commodity indices. The spike in gold prices has also led to a surge in the share prices of many gold miners.
Gold prices got a boost in March 2016 after the Fed left benchmark interest rates steady (in the band of 0.25%-0.50%) and cut its short-term rate hike expectations to two quarter-point rises from the initial outlook of four hikes citing continued risk from an uncertain global economy and volatile stock markets. The outlook triggered a sharp fall in the U.S. dollar against a basket of rival currencies, leading to a spurt in gold prices.
Gold prices also got a lift recently after a weaker-than-expected U.S. job report faded all hopes of a Fed rate hike this month. The U.S. economy created a paltry 38,000 jobs in May, well below the consensus estimate of 203,000. The disappointing job report lowered the likelihood of a rate hike, which in turn augers well for gold.
A delay in raising interest rates elevates demand for gold, which produces no income but relies on price appreciation to lure investors. On the other hand, a hike in interest rates tends to boost returns from income generating assets and thus hits non-yielding commodities, including gold.
A host of factors also contributed to the recent rally in gold prices including a weakening greenback, slowdown in China, volatile equity markets and introduction of negative interest rates by several of the world’s central banks (including Japan) that have spurred safe-haven demand for gold.
Concerns about a potential British exit from the European Union are also supporting gold prices of late. Britain will vote whether or not to remain in the European Union on June 23. A potential “Brexit” would bring instability to Europe, which could send shockwaves through global stock markets.
Another factor that will act as a tailwind for gold is that the supply of the yellow metal has already reached peak levels as per reports. Lower gold prices in the past few years and cost pressure had restricted the ability of gold producers to invest in new projects. Production of gold is likely to decline by 3% in 2016, thus ending a seven-year stint of rising output. Moreover, gold prices should get support from retail demand in the second half of 2016, which is seasonally strong for top consumers like India and China.
5 Attractive Picks
Amid this favorable backdrop for bullion, it would be a prudent idea to zero in on some gold mining stocks that are trading at attractive prices and are good options for investment right now.
We have employed the Zacks Stocks Screener to find companies that sport a favorable Zacks Rank and are currently trading below $10. We highlight the following 5 cheap gold mining stocks that could be worth putting your money in. These top-ranked companies are well-placed to leverage the recent rebound in the gold market.
B2Gold Corp. (BTG - Free Report)
Vancouver, Canada-based B2Gold explores and develops mineral properties in Nicaragua, the Philippines, Namibia, Burkina Faso and Chile. The company primarily explores for gold, silver and copper.
The stock holds a Zacks Rank #1 (Strong Buy) and is currently trading at $2.06. The company has seen its shares shoot up around 102% year to date.
Pretium Resources Inc.
Vancouver, Canada-based Pretium acquires, explores and develops precious metal resource properties in the Americas. Its mineral interests consist of gold, copper and silver exploration projects.
Pretium sports a Zacks Rank #1 and is currently trading at $8.82. The stock has gained around 75% year to date.
IAMGOLD Corp. (IAG - Free Report)
Toronto-based IAMGOLD is engaged in the exploration, development and operation of gold mining properties. It also explores for copper and silver. The company holds interests in four operating gold mines, as well as exploration and development projects located in Africa, South America and Canada.
IAMGOLD holds a Zacks Rank #2 (Buy) and is currently trading at $3.88. The stock has gained a whopping 173% so far this year.
Harmony Gold Mining Company Limited (HMY - Free Report)
South Africa-based Harmony conducts underground and surface gold mining and is also engaged in related activities such as exploration, processing, smelting and refining.
The stock has a Zacks Rank #2 and is currently trading at $3.65. Harmony has seen its shares skyrocket roughly 293% year to date.
Pershing Gold Corporation
Lakewood, CO-based Pershing Gold engages in the exploration and mining of gold and precious metal properties mainly in Nevada. It focuses on the exploration of Relief Canyon properties covering an area of around 25,000 acres based in Pershing County in north western Nevada.
The company carries a Zacks Rank #2 and is currently trading at $4.33. The stock has gained roughly 23% year to date.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>