Best Canadian Gold Stocks: Hedge Your Portfolio Against Inflation

Investing in Gold can be ‘seen’ as a safe haven for many when confidence is low in the markets and in the economy. Gold value per ounce is a regular metric being shared globally through daily news alongside a country’s currency and oil prices.

Regardless of your motivation to invest in gold, there are a number of ways to be exposed to gold; from buying gold bullion to investing in gold mining companies to investing in precious metal ETFs. In some cases, you can even have a dividend paying gold mining stocks.

Here are your Canadian gold investing options – jump ahead to read more:

Invest in Gold Bullion

If you want to own gold as is, then the bullion is for you. Investing in gold bullion is similar to buying currency in a way. You buy it at a certain price and hold it until you want to sell. Gold prices fluctuate over time and it’s rated by the ounce.

To buy gold bullion, you can always use the Canadian Mint. There is a lot of information for buying, storing and trading precious metals with the Canadian Mint.

Invest in Gold ETFs

Above is just a few of the gold producing companies out of many. Newmont, Barrick Gold, and Franco-Nevada are really the top three major dividend paying stocks if you want to invest in individual stocks.

If you are just getting started with gold, it might be easier to just get a gold ETF and buy a little bit of the many gold producers through an ETF. XGD from iShare tracks the S&P/TSX Global Gold Index Fund and contains 39 holdings. 

iShare Gold ETF
Source: iShares S&P/TSX Global Gold Index ETF

Invest in Gold Dividend Stocks

These are some of the major players in the gold mining industry that paid a dividend with some amount of consistency. There are at least 13 dividend gold stocks on the TSX from what I can see today but only 4 have increased the dividend for more than 1 consecutive years.

Gold stocks tend to be inconsistent with dividends but again that’s not usually the reason for someone to invest in gold.

Ticker Ticker Company Market Cap P/E Aristocrat Graph SectorID IndustryID
NGT TSE:NGT Newmont 57.04 0.00 NO 1 1 46
ABX TSE:ABX Barrick Gold 43.46 17.32 NO 1 1 46
FNV TSE:FNV Franco-Nevada Corp 33.26 38.16 YES 1 1 46
WPM TSE:WPM Wheaton Precious Metals Corp 23.98 30.55 YES 1 1 46
AEM TSE:AEM Agnico Eagle Mines 16.03 19.58 YES 1 1 46
KL TSE:KL Kirkland Lake Gold 13.60 12.26 NO 1 1 46
K TSE:K Kinross Gold 9.66 7.67 NO 1 1 46
BTO TSE:BTO B2Gold 5.37 9.44 NO 1 1 46
YRI TSE:YRI Yamana Gold 4.88 27.24 NO 1 1 46
AGI TSE:AGI Alamos Gold 3.85 0.00 NO 1 1 46
OR TSE:OR Osisko Gold Royalties 2.63 1095.77 NO 1 1 46
CEE TSE:CEE Centamin PLC 1.88 0.00 NO 1 1 46

1. Agnico Eagle Mines

AEM - Agnico Eagle Mines Limited Agnico Eagle is a leading gold miner having an extensive experience of more than 60 years. The company has mines in Canada, Finland, and Mexico. Agnico’s exploration activities are conducted across these countries as well as in the US and Sweden. The company focuses on low cost high potential regions to drive future growth.

Agnico has a sound track record of exceeding its production targets. It produced 1.63 million ounces of gold and outperformed its cost guidance by approximately 2% in the last year. As an operator of high-quality gold mining business, Agnico has superior quality gold reserves and its gold grade is more than double that of its peers in North America.

The company is expecting to drive a new growth phase, over the next five years, on the back of its current project pipeline. It provides its shareholders with full exposure to gold prices.

Key Investment Data

  • Ticker: TSE:aem
  • Sector: Basic Materials
  • Industry: Gold
  • Market Cap: 16.03B
  • P/E: 19.58
  • Dividend Yield: 2.74%
  • Payout Ratio (TTM): 52.60%

2. Kirkland Lake Gold

KL Kirkland Lake Gold Kirkland Lake Gold Ltd. is a senior gold producer operating in Canada and Australia. Its production profile is anchored by three high-quality operations including, the Macassa Mine and Detour Lake Mine, both located in Northern Ontario, Canada and the Fosterville Mine located in the State of Victoria, Australia.

A key driver of it success continues to be its commitment to exploration, where the company has a solid track record for growing reserves and identifying new areas of high-grade gold mineralization. In support of shareholder returns, it has paid a quarterly dividend since July 2017 and have continually increased the dividend since then. 

Underlying everything is a commitment to sustainable production. Sustainability involves achieving high levels of performance in safety, environmental management and community consultation and support. The company works diligently with all stakeholders to ensure that Kirkland Lake Gold remains a welcome member of the communities in which it operates.

Key Investment Data

  • Ticker: TSE:kl
  • Sector: Basic Materials
  • Industry: Gold
  • Market Cap: 13.60B
  • P/E: 12.26
  • Dividend Yield: 1.86%
  • Payout Ratio (TTM): 22.40%

3. Franco-Nevada

FNV - Franco-Nevada Corp Franco Nevada is the leading gold-focused royalty and stream company. It is the largest company by both gold revenue and the number of gold assets. The company provides financing to miners in exchange for the right to buy gold at contractually discounted rates in the future and in return gets access to precious metals without any mining work.

Franco Nevada is the world’s largest and most successful gold royalty company. The company’s portfolio is highly diversified by commodity, geography, revenue type, and projects. Franco Nevada has interests in 227 exploration stage mineral properties including 202 precious metals assets and 25 other exploration assets.

Over 88% of Franco’s revenue (Q1 2019) was derived from gold and gold equivalents (63% gold, 11% silver, 11% PGM and 3% other mining assets) and 12% from energy (oil, gas, and NGLs). Geographically, Americas is its largest market accounting for over 80% of total revenues - 42% Latin America, 18% U.S. and 20% Canada, followed by the rest of the world.

Key Investment Data

  • Ticker: TSE:fnv
  • Sector: Basic Materials
  • Industry: Gold
  • Market Cap: 33.26B
  • P/E: 38.16
  • Dividend Yield: 0.88%
  • Payout Ratio (TTM): 31.10%

4. Barrick Gold

ABX - Barrick Gold Barrick Gold is a leading gold mining company in the world. The company engages primarily in gold and copper operations as well as exploration and mine development.

Barrick Gold’s recent merger with Randgold Resources has created a sector-leading gold mining company. Barrick Gold owns five of the world’s Top 10 Tier 1 gold assets such as Cortez and Goldstrike in Nevada, USA and Kibali mine in Africa.

The company has mining operations in 15 countries, including Argentina, Australia, Canada, Chile, the US, Saudi Arabia, Zambia, etc. Barrick Gold sells its products in the world market through different distribution channels like the gold spot market and independent smelting companies.

The company is the owner of a diversified asset portfolio located in many of the world’s richest gold areas. Barrick has the lowest cash cost position amongst its peers.

Key Investment Data

  • Ticker: TSE:abx
  • Sector: Basic Materials
  • Industry: Gold
  • Market Cap: 43.46B
  • P/E: 17.32
  • Dividend Yield: 1.88%
  • Payout Ratio (TTM): 32.10%

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DISCLOSURE: Please note that I may have a position in one or many of the holdings listed. For a complete list of my holdings, please see my Dividend Portfolio.

DISCLAIMER: Please note that this blog post represents my opinion and not an advice/recommendation. I am not a financial adviser, I am not qualified to give financial advice. Before you buy any stocks/funds consult with a qualified financial planner. Make your investment decisions at your own risk – see my full disclaimer for more details.