Gold Was Red Hot in the First Half of 2024; Here Are 3 Gold Stocks to Buy and Hold for the Long Run

Core Insights - Gold prices have risen 14.6% in 2023 and an additional 12.2% in the first half of 2024, with J.P. Morgan forecasting an average price of $2,500 per ounce in Q4 2024 [1] Group 1: Agnico Eagle Mines - Agnico Eagle has become one of the largest gold producers, with projected gold production between 3.35 million ounces and 3.55 million ounces in 2024, up from 240,000 ounces in 2005 [2] - The company reported a record free cash flow of $947 million in 2023, equating to $1.91 per share, which comfortably covered its dividend of $1.60 per share [3] Group 2: Franco-Nevada - Franco-Nevada operates as a royalty and streaming company, providing upfront capital to mining companies and receiving a percentage of the mined minerals, with 63% of its revenue coming from gold in Q1 2024 [4] - The company has no debt, making it an attractive option for risk-averse investors [4] Group 3: Newmont - Newmont, with a market capitalization of $53.7 billion, forecasts gold production of 6.9 million ounces in 2024, but its stock has only risen 9% despite a 22% increase in gold prices over the past year [5] - The company reduced its quarterly dividend from $0.40 to $0.25 per share in February, aiming to optimize its portfolio, but plans to repurchase $1 billion in stock over the next two years [6] - Newmont shares are currently valued at 9.8 times operating cash flow, close to their five-year average of 9.9, presenting a potential buying opportunity [6] Group 4: Investment Considerations - Both Agnico Eagle and Newmont offer forward dividend yields of 2.2%, with Agnico Eagle being more appealing for its strong free cash flow, while Newmont may attract those looking for a less expensive valuation [8] - Investors seeking indirect exposure to gold may find Franco-Nevada a suitable option to diversify their holdings [8]