7 Top-Rated Gold Stocks to Buy as a Portfolio Hedge
A challenging stock market in 2022 – and the likelihood of continued high inflation in 2023 – has many investors looking for gold stocks to buy to hedge their portfolios.
Granted, there are already some pressures on gold prices, which are down about 2% in 2022. The Federal Reserve’s moves to raise interest rates in turned strengthened the U.S. dollar, but using gold as a hedge against inflation is still a good idea.
A slowdown in the economy and monetary tightening could lead to stagflation. That’s a scenario that would boost gold prices and gold stocks, even as the greater stock market would suffer.
But to best profit in this hedge-worthy scenario, you have to know which are the best gold stocks to buy. That’s where my free Portfolio Grader tool comes in.
The Portfolio Grader evaluates stocks based on qualitative and momentum metrics, such as earnings history and surprises, analyst sentiment and buying pressure. Then it gives each stock a grade in an “A” through “F” scale – and just like school, the best stocks to buy merit better grades.
Here are some top-rated gold stocks to buy for investors looking to hedge their portfolio now.
| HYMC | Hycroft Mining | $0.69 |
| MP | MP Materials | $32.93 |
| BVN | Compania de Minas Buenaventura SAA | $8.32 |
| GFI | Gold Fields | $11.32 |
| IDR | Idaho Strategic Resources | $5.81 |
| IAUX | i-80 Gold Corp. | $2.94 |
| XPL | Solitario Zinc | $0.62 |
Hycroft Mining (HYMC)
If you were hoping that Hycroft Mining (NASDAQ:HYMC) would become the latest hot meme stock, then you’ve been disappointed in this gold miner. But that doesn’t mean that Hycroft is a bad company. In fact, it remains one of the best gold stocks to buy at this point.
Now priced at less than $1 per share, Hycroft stock is down 69% from its March peak. But it’s still showing a 17% gain in 2022 and will close out the year in a stronger position than it began. Hycroft also has ample resources at its mining site in northern Nevada, with an estimated 9.5 million in available gold ounces and 456 million silver ounces.
Revenue in the third quarter was $8.76 million, which was actually down 72% from a year ago. But the company also managed to narrow its losses, cutting them from 39 cents per share a year ago to just 8 cents per share.
That helps give HYMC stock a “B” rating in my Portfolio Grader.
MP Materials (MP)
Headquartered in Las Vegas, MP Materials (NYSE:MP) operates the Mountain Pass Mine, which is the only rare earth mine and processing facility in the U.S.
Rare earth mining involves processing materials such as lanthanum, cerium, neodymium and praseodymium, which are used to manufacture products such as rechargeable batteries, electric vehicle motors, mobile devices and wind turbines. The Mountain Pass facility is responsible for roughly 15% of global rare earth mining.
MP stock is down 31% so far this year but has held its own over the last quarter when it only showed a loss of 2%. The company consistently beats expectations with its quarterly earnings. For the third quarter, it showed revenue of $124.44 million and earnings of 36 cents per share. Analysts expected revenue of $118.1 million and EPS of just 30 cents.
MP stock has a “B” rating in the Portfolio Grader.
Compania de Minas Buenaventura SAA (BVN)
Compania de Minas Buenaventura SAA (NYSE:BVN) is a precious metals company based in Peru. Peru ranked seventh in the world for gold mine production in 2021, producing more than 127 metric tons.
BVN is up more than 50% over the last three months, but the stock is still relatively cheap. It is priced at less than $10 and with a price-sales ratio of just over 3.
Earnings for the third quarter were $195.42 million, beating analysts’ expectations for $183 million. But the company also reported an earnings loss of 8 cents per share, while the Street was only expecting a loss of 2 cents per share.
BVN projects it has ample gold, silver and copper reserves at its mines to sustain operations for at least the next 20 years.
The stock has a “B” rating in the Portfolio Grader.
Gold Fields (GFI)
Gold Fields (NYSE:GFI) has a global footprint, with operations in its home country of South Africa as well as in Australia, West Africa, Ghana and Peru.
GFI stock took a giant leap forward in November, rising by 40% after it announced it gave up its bid to buy Canadian company Yamana Gold (NYSE:AUY) after Yamana backed a competing $4.8 billion takeover bid from Agnico Eagle Mines (NYSE:AEM) and Pan American Silver Corp. (NASDAQ:PAAS).
Gold Fields had announced in May that it made a $6.7 billion bid to buy Yamana in an all-stock transaction, but the valuation declined by about $2.3 billion when investors began dumping GFI shares.
Now that it’s rid of the Yamana drag on its share price, Gold Fields looks more appealing – particularly if the price of gold can bounce back to $2,000 per ounce, as it was earlier in the year.
The company’s revenue in the second quarter was $1.12 billion, an increase of more than 12% from a year ago. GFI stock has a “B” rating in the Portfolio Grader.
Idaho Strategic Resources (IDR)
While MP Materials has a lock on U.S. production of rare earth materials, that could possibly change. Idaho Strategic Resources (NYSEAMERICAN:IDR) is in the exploration stage for rare earth element materials at its mines.
On Dec. 1, the company announced it increased its position within the Idaho Rare Earth Element-Thorium Belt to more than 11,000 acres.
In a letter to shareholders, the company said that its gold and rare earth interests are “of equal importance” and that its rare earth and thorium business carries “nearly immeasurable blue-sky potential.”
The potential in IDR stock is unmistakable particularly as Washington is working to wean the U.S. off of rare earth materials from China. And that helps give it a “B” rating in the Portfolio Grader.
i-80 Gold Corp. (IAUX)
Based in Nevada, i-80 Gold Corp. (NYSEAMERICAN:IAUX) has a market capitalization of only $700 million. But it has big aspirations that should bring some solid returns for investors.
The company, which didn’t start trading publicly on the New York Stock Exchange until May 19, is increasing its drilling operations at its Ruby Hill property in Eureka County, Nevada, saying that drilling there “has truly outperformed expectation.”
The Ruby Hill mine has gold, gold-silver and polymetallic deposits. National Bank initiated coverage with an “outperform” rating on the stock, which is up by 77% over the last month.
The company reported third-quarter gold sales of 9,332 ounces and year-to-date gold sales of 14,328 ounces. Revenue for the quarter came in at $16.01 million, with an operating loss of $12.25 million.
IAUX stock has a “B” rating in the Portfolio Grader.
Solitario Zinc Corp. (XPL)
Based in Wheat Ridge, Colorado, Solitario Zinc (NYSEAMERICAN:XPL) maintains two primary partnerships to mine for zinc in North America. It has a partnership with Nexa Resources (NYSE:NEXA) to operate the Florida Canyon Zinc Project, and it works with Teck Resources (NYSE:TECK) to operate the Li Zinc Project in Alaska.
The company also has an exploration project in Peru with the hopes of expanding to a multiple-asset intermediate resource company.
In November, Solitario announced it discovered a new area of potential gold and silver assets in South Dakota, where it expanded its position.
XPL stock is up by nearly 10% in the last three months. It has a “B” rating in the Portfolio Grader.
On the date of publication, Louis Navellier had a long position in MP. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
