Top-Rated 2018 Gold Stocks

Written by Jason Simpkins
Posted January 11, 2018 at 7:00PM

First and foremost, Nick Hodge just released a brand-new report detailing a blockbuster gold project in Idaho.

It has high-grade, easily-extractable reserves and the potential to deliver massive returns to investors.

And the best part is: Virtually NO ONE has heard about it yet.

So if you’re serious about profiting from gold, not just in 2018, but through the foreseeable future, you should check that out here.

In the meantime, I’ve put together a list of more well-known, mainstream gold mining companies that are still likely to beat the market in the year ahead.

They are:

  • Agnico Eagle Mines Limited (NYSE: AEM)
  • OceanaGold Corporation (TSX: OGC) (OTC: OCANF)
  • Newcrest Mining Limited (ASX: NCM) (OTC: NCMGY)
  • And Alamos Gold Inc. (NYSE: AGI)

So let’s take a quick look at each…

Agnico Eagle Mines Limited (NYSE: AEM)

We first recommended buying Agnico Eagle in December 2015, when it was trading at just $26.

Since then, it's nearly doubled to its current level of $45, with a market cap of $10.5 billion.

The key is Agnico's low-cost production.

Its all-in sustaining cost (AISC) is just $845 per ounce. That's kept the company profitable and has also allowed it to pay down its debt and acquire new assets.

In 2014, Agnico purchased a 50% stake in what was Osisko Mining's Malartic mine. This contributed to an 18% increase in reserves and record-high production in 2015.

Payable production in 2015 was 1,671,340 ounces of gold at total cash costs per ounce of $567. In 2016, the company registered 1,662,88 ounces at a total cash cost of $622 per ounce.

And now, the company is expecting average annual production of approximately 1.55 million ounces of gold through 2019 and 2 million ounces in 2020:

Agnico Eagle ProductionAgnico has also been one of the few mining companies increasing exploration (doubling its budget) while simultaneously cutting its debt.

The miner now boasts a debt-to-market cap ratio of less than 10% and $866 million in cash.

Agnico could do any number of things with that capital. It could acquire new assets, building onto its base, or weather another downturn in metals prices. It might also raise its $0.11 dividend, which currently yields about 1%.

Low costs, low debt, strong reserves.

Agnico has been, and will continue to be, one of the stronger mining investments in the game.

OceanaGold Corp. (TSX: OGC) (OTC: OCANF)

OceanaGold Corp is an Australia-based miner. It’s much smaller than Agnico Eagle, but then again, so are its costs...

The company's AISC was just $650 per ounce in 2017, with gold trading at twice that level.

Oceana's gold output topped 400,000 ounces in 2015 and 2016, and it exceeded that level within the first three quarters of 2017. Full-year gold production is estimated to be between 550,000 and 600,000 ounces. And it came up with some 19,000 tonnes of copper on top of that.

The company has $61 million in cash.

Yet, for some reason, the stock remains undervalued by the market, with its share price trailing gold since last spring:

Oceana StockIn short, OceanaGold is looking at a few years of very strong profits, with the potential to improve long-term production at very low all-in costs.

Its stock ought to be worth more, given the circumstances.

Newcrest Mining Ltd (ASX: NCM) (OTC: NCMGY)

Newcrest Mining Ltd. is Australia’s biggest gold miner. It also has operations in the Asia-Pacific and West Africa. It's just one of four companies that holds more than one mine in the world's top-30 producers list.

Its group AISC is $787 per ounce with its best-performing mine, Cadia, producing at just $227 per ounce. Cadia also has a reserve life of approximately 40 years, with 26 million ounces of gold reserves. The mine is the top-producing gold mine in Australia.

Another mine, Lihir, has an estimated 35 years of reserve life, with AISC of $804 per ounce. It has gold reserves of 28 million ounces and resources of 57 million ounces.

In all, the average reserve life of Newcrest's mines is about 27 years. That's exceptionally good for the industry. If you look at the graph below, you'll see that Newcrest leads the pack when it comes to mine life and AISC margin:

Newcrest Mine LifeIts total reserves are also world class with an estimated 130 million ounces of gold, 95 million ounces of silver, and 19 million tonnes of copper.

Newcrest has shed $1.33 billion in debt over the last two years. That's brought the company's net debt and EBITDA ratio down to 1.5.

Alamos Gold Inc. (NYSE: AGI)

At $940 per ounce, Alamos Gold's AISC is a little bit higher than the other miners we've discussed.

However, those costs are shrinking and production is on the rise.

Total gold production is expected to fall between or even exceed 400,000 to 430,000 ounces in 2017, up from 392,000 ounces in 2016 and 380,000 ounces in 2015.

At the same time, AISC fell more than 7% annually from 2015-17. AISC margin jumped a shocking 300% from 2015 to 2016 and another 35% in 2017 to an estimated $310 per ounce.

Alamos AISCAlamos is also in a strong fiscal position, with about $168 million in cash and no debt.

The company's flagship mine is the Young-Davidson mine in Ontario, Canada. It has 3.9 million ounces of proven and probable reserves and another 1.2 million ounces measured, indicated, and inferred. Young-Davidson has a 15-year reserve life.

Production from that mine came in at 170,000 ounces in 2016 at an AISC of $897 per ounce. In 2017, the mine produced 200,000-210,000 ounces at an AISC of $775.

Alamos Gold's Mulatos mine has proven and probable reserves of 1.5 million ounces of gold and more than 3 million ounces measured, indicated, and inferred. It contributed 154,000 ounces in 2016, up from 140,000 ounces in 2015.

Beyond that, the Kirazli, Agi Dagi, and Camyurt pipeline projects are under development in Turkey.

Alamos Return

The company has a $2.6 billion market cap and has performed exceptionally well for investors both over the short and long term.

No doubt, these four gold mining stocks will perform very well in 2018, as we firmly believe the price of gold will continue to rise.

But again, if you’re looking for a real home run, you should check out Nick Hodge’s latest report. The discovery he’s found is transformative and the company behind it is trading at less than $1 per share.

Fight on,

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Jason Simpkins

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Jason Simpkins is Assistant Managing Editor of the Outsider Club and Investment Director of The Wealth Warrior, a financial advisory focused on security companies and defense contractors. For more on Jason, check out his editor's page. 

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