Have you invested in precious metal stocks? In case you haven’t noticed, gold prices have surged this year, and pundits see that trend continuing. Here’s the best gold stock you should consider buying right now.
Not all gold stocks are created equally
Before mining activities kick off, traditional miners are tasked with a few costly and time-consuming tasks. This includes identifying potential sites and making the necessary procurements to begin extracting metals from the mine.
What if there was a gold stock that didn’t require you to worry about any of those activities?
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Enter Wheaton Precious Metals (TSX:WPM), which is one of, if not the best gold stock to invest in right now.
Wheaton is what is known as a precious metals streamer. Streamers differ from their traditional mining peers in that they do not own any mines. Additionally, they don’t handle any of the day-to-day management of the mine.
Instead, streamers are responsible for providing upfront capital to traditional miners. It is the traditional miner who in turn sets up the mine and begins operations.
In exchange for that financial injection, Wheaton is allowed to purchase metals produced by the mine at a considerable discount. Keep in mind that the discounted number is well below market rates. As of the time of writing, silver trades near US$30 per ounce, while gold is just over US$2330 per ounce.
Wheaton can then proceed to sell those metals at the going market rate. By way of comparison, the market rate for silver is just shy of US$30 per ounce, while gold trades at just over US$2330 per ounce.
Wheaton offers more than traditional miners
Another key advantage over traditional miners is that streamers like Wheaton can quickly move on to the next candidate mine, irrespective of what traditional miner owns it. In other words, Wheaton leaves the day-to-day management of the mine to the traditional miner.
This is part of the reason why Wheaton boasts a whopping 18 operating mines and another 26 projects in various stages of development.
By extension, this also means that streamers like Wheaton are considerably lower-risk options over traditional miners. While that may seem like reason enough to buy Wheaton as the best gold stock option, there are a few more key points to consider.
Unlike traditional miners that are straddled with considerable costs and debt, Wheaton has no debt and $306 million in cash as of the most recent quarter. During that quarter, the company earned $164 million on an adjusted basis on revenue of $297 million.
And that’s not even the best part.
The existing and in-development projects mentioned above are expected to drive production up considerably over the next five years. Wheaton expects to realize a whopping 40% bump in production, stemming primarily from those existing facilities.
Wheaton’s impressive growth is just half the story. The other piece that prospective investors should take into consideration is the streamer’s quarterly dividend.
As of the time of writing, Wheaton offers a respectable yield of 1.2%. While that’s not the highest yield on the market, it is covered and significantly lower risk when compared to traditional miners.
Invest in the best gold stock today
Wheaton offers investors a growing dividend, solid growth and a reliable, lower-risk business model. This makes it a great fit for investors looking at precious metals stocks.
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TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
