Last Thursday, a weak dollar and data indicating a spike in the United States consumer prices boosted the yellow metal’s appeal as an inflation hedge. Spot gold prices recouped losses to trade 0.2% higher at $1,835.71 per ounce. The U.S. gold futures settled unchanged at $1,837.40 per ounce.

On top of that, gold prices jumped to a near two-month peak on Friday due to the escalating tensions between Russia and Ukraine. Spot gold rose 1.6% to $1,855.17 per ounce, reflecting its highest gains since November 19, and was poised to surge 2.5% weekly. Gold prices hit multi-month highs in the $1860s last Friday amid rising geopolitical concerns.

OANDA senior market analyst Edward Moya has predicted that gold could breach the $1900 per ounce level if military action spurs between the two countries. Amid this, the gold mining stocks B2Gold Corp. (BTG), Centerra Gold Inc. (CGAU), DRDGOLD Limited (DRD), and Jaguar Mining Inc. (JAGGF) might be solid bets.

B2Gold Corp. (BTG)

BTG, based in Vancouver, Canada, is a gold producer that primarily operates on three mines located in Mali, the Philippines, and Namibia. The company also holds a major interest in the Kiaka Project in Burkina Faso.

On February 2, BTG announced that the Government of Mali has recently granted its Malian subsidiary a new exploration permit covering the same perimeter as the Menankoto permit, with exploration set to begin on February 15. The drilling permit is expected to bolster the company’s operational capability.

On November 30, BTG announced that it had completed the sale of its 81% interest in the Kiaka gold project located in Burkina Faso to West African Resources Limited (WAF). Concurrently, with the closing of the Kiaka Project, the company also announced the completion of the sale of its 90% interest in the Toega gold project. Under the agreement, BTG is expected to receive a considerable amount and significant royalty interests, which should improve its cash position.

For the third fiscal quarter ended September 30, BTG’s gold revenue increased 4.9% year-over-year to $510.86 million. Cash provided by operating activities grew 6.8% from the prior-year quarter to $320.28 million, while the company’s cash and cash equivalents balance came in at $546.51 million, up 49.5% from the same period last year.

The consensus revenue estimate of $1.78 billion for fiscal 2022 indicates an increase of 1.2% from the prior year.

BTG’s stock has gained 8.6% over the past month and 6.5% over the past five days to close Friday’s trading session at $3.93.

BTG’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, which equates to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.

BTG has a Quality grade of A and a Value and Sentiment grade of B. In the 48-stock Miners – Gold industry, it is ranked #5. To see the additional POWR Ratings for Growth, Momentum, and Stability for BTG, click here.

Centerra Gold Inc. (CGAU)

CGAU operates as a gold mining company that acquires, explores, and develops gold and copper properties in North America, Asia, and globally. The company’s principal project includes the 100% owned Mount Milligan gold-copper mine, located in British Columbia. It is headquartered in Toronto, Canada.

On November 5, CGAU declared a quarterly dividend of C$0.07 per common share, which amounts to $16.40 million, which was payable to shareholders on December 3. This reflects the company’s stable cash position.

For the nine months ended September 30, CGAU’s revenue increased 27.5% to $649.06 million. Net earnings and net earnings per share from continuing operations came in at $172.07 million and $0.56, both up substantially from their negative year-ago values. The company’s cash balance came in at $911.70 million, up 88.3% from the prior-year period.

The consensus EPS estimate of $1.04 for fiscal 2022 indicates a 25.3% year-over-year increase. Likewise, the consensus revenue estimate for the same year of $1.14 billion reflects a rise of 13% from the prior year.

The stock has gained 15% over the past six months and 11.1% year-to-date to close Friday’s trading session at $8.53.

It’s no surprise that CGAU has an overall B rating, which translates to Buy in our POWR Rating system. The stock has a Quality grade of A and a Value and Sentiment grade of B. It is ranked #1 in the Miners – Gold industry. Click here to see the additional POWR Ratings for CGAU (Growth, Momentum, and Stability).

DRDGOLD Limited (DRD)

DRD operates as a gold mining company that engages in the surface gold tailings retreatment business in South Africa. Based in Johannesburg, South Africa, the company is involved in exploration, extraction, processing, and smelting activities.

For the fiscal year ended June 30, DRD’s revenue increased 25.9% year-over-year to ZAR5.27 billion ($345.95 million). Profit for the year rose 126.8% from the prior year to ZAR1.44 billion ($94.54 million), while EPS came in at 167.20 SA cents, up 106.4% from the same period the prior year.

The street expects DRD’s EPS to increase 15% year-over-year to $0.77 for the fiscal year 2023, while analysts expect revenue to rise 10.5% from the prior year to $361.31 million for the same period.

DRD’s shares have gained 2.7% over the past five days and 5.7% intraday to close Friday’s trading session at $8.33.

DRD’s POWR Ratings reflect this promising outlook. The stock has an overall B rating, which equates to Buy in our proprietary rating system. DRD has a Value grade of B. It is ranked #4 in the same industry. Click here to see the additional POWR Ratings for Growth, Momentum, Stability, Sentiment, and Quality for DRD.

Jaguar Mining Inc. (JAGGF)

JAGGF is a junior gold mining company that acquires, explores, develops, and operates gold-producing properties in Brazil. The company, headquartered in Toronto, Canada, holds principal assets in the Iron Quadrangle in Minas Gerais, Brazil.

On January 17, JAGGF announced the approval of the implementation of a five-year plan to grow the company organically. About this plan, Vern Baker, President, and CEO of JAGGF, said, “Our Board has approved an increase of 85% in direct exploration and capital growth expenditures to allow our team the opportunity to demonstrate that potential. We believe our underlying mineral resource and mineral reserves will grow in 2022, and we will add 1 or 2 new mining areas to our portfolio. We are also highly confident the exploration team will be expanding the number and quality of exploration targets across our mineral tenement portfolio.”

JAGGF’s revenue for the fiscal third quarter ended September 30 came in at $40.75 million. Net income and EPS stood at $11.42 million and $0.16, respectively. Adjusted EBITDA came in at $19.21 million for the period.

Street EPS estimate for the fiscal year ending December 2022 of $0.65 reflects a 43.3% year-over-year improvement. Likewise, the Street revenue estimate of $168.05 million for the same period indicates a rise of 11.9% from the prior year.

Over the past five days, the stock has gained 7.3% to close Friday’s trading session at $3.40. It has gained 8.3% intraday.

JAGGF has an overall rating of B, which translates to Buy in our POWR Rating system. The stock has a Quality grade of A and a Value and Momentum grade of B. It is ranked #3 in the same industry.

In addition to the POWR Rating grades we’ve stated above, one can see JAGGF ratings for Growth, Stability, and Sentiment here.

BTG shares were trading at $4.00 per share on Monday afternoon, up $0.07 (+1.78%). Year-to-date, BTG has gained 1.78%, versus a -7.76% rise in the benchmark S&P 500 index during the same period.

About the Author: Anushka Dutta

Anushka is an analyst whose interest in understanding the impact of broader economic changes on financial markets motivated her to pursue a career in investment research. More...

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