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4 Gold Stocks to Gain as Geopolitical Tensions Worsen

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Key Takeaways

  • Rising geopolitical tensions have pushed gold above $3,300/oz, fueling investor demand.
  • FNV and RGLD showed strong earnings growth and improved estimates over the past 60 days.
  • HMY and AU also report rising earnings expectations as gold scarcity supports higher prices.

Gold prices have been on the rise over the past several months, which has given a boost to stocks linked to gold mining. Rising geopolitical tensions, especially the ongoing tensions in the Middle East between Iran and Israel, with the United States now having joined the conflict, have been helping gold prices.

Given the current situation, investing in gold mining stocks such as Royal Gold, Inc. (RGLD - Free Report) , Franco-Nevada Corporation (FNV - Free Report) , Harmony Gold Mining Company Limited (HMY - Free Report) and AngloGold Ashanti plc (AU - Free Report) would be a wise decision. Each of these stocks carries a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Gold Prices Surge on Geopolitical Tensions

On Friday, spot gold hit $3,369.63 an ounce and is currently sitting above $3,300/ounce. The jump came as the United States attacked the nuclear sites of Iran on Sunday, joining the conflict between the Islamic Republic and Israel. This has given a boost to the demand for the yellow metal, which is often considered a safe haven.

The ongoing Middle East crisis isn’t acting as the only tailwind for the yellow metal. The three-year-long war between Russia and Ukraine has also been a catalyst for both spot and future gold prices.

Additionally, the World Gold Council recently said that the gold mining industry is struggling due to a shortage of the yellow metal. This is driving demand, and the central banks of several nations are buying gold at an aggressive pace as they are cutting interest rates in a bid to strengthen their economies.

Gold prices are likely to surge in the near term as demand for the yellow metal is also being driven by industries like healthcare and technology. Experts believe that the imbalance between demand and supply is likely to further boost gold prices, which could hit $4,000 an ounce by 2026.

4 Gold Mining Stocks With Upside

Royal Gold

Royal Gold, Inc., together with its subsidiaries, acquires and manages precious metals stream and royalty interests, with a primary focus on gold. 

Royal Gold has an expected earnings growth rate of 35.9% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 9.3% over the past 60 days. RGLD currently sports a Zacks Rank #1.

Franco-Nevada Corporation

Franco-Nevada Corporation operates as a gold-focused royalty and stream company with additional interests in silver, platinum group metals, oil & gas and other resource assets. FNV has a diversified portfolio of 54 producing assets consisting of four larger cash-flowing assets — Antamina, Antapaccay, Candelaria and Cobre Panama. It also has interests in 41 advanced assets (which are not yet producing) and interests in 223 exploration-stage mining properties. 

Franco-Nevada Corporation has an expected earnings growth rate of 41.7% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 6.3% over the past 60 days. FNV currently carries a Zacks Rank #1.

Harmony Gold Mining Company Limited

Harmony Gold Mining Company Limited conducts underground and surface gold mining. It is also engaged in related activities such as exploration, processing, smelting and refining. HMY is South Africa's biggest gold producer by volume, with production of 1.47 million ounces in fiscal 2023.

Harmony Gold Mining Company Limited has an expected earnings growth rate of 14.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.7% over the past 60 days. HMY currently has a Zacks Rank #1.

AngloGold Ashanti plc

AngloGold Ashanti plc operates as a gold mining company in Africa, the Americas, and Australia. AU explores for gold, and its flagship property is the Geita project.

AngloGold Ashanti plc has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 97.2% over the past 60 days. AU currently has a Zacks Rank #1.

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