Top Gold Stocks in ASX 2024 – Should You Invest in Them?

Gold prices and its stocks have shown a stable increase each year in Australian markets. There are several stocks listed in ASX related to gold mining and trading. In this blog, we will discuss the top gold stocks in ASX by market capitalization and provide a detailed fundamental analysis of each stock.

gold stocks in asx

Some of the top gold stocks in ASX (Australian Securities Exchange) are:

  1. Newcrest Mining Limited (NCM): With a market capitalization of approximately AUD 23.6 billion, Newcrest Mining is one of the largest gold producers in Australia. The company operates mines in Australia, Papua New Guinea, and Canada and has a strong track record of exploration success.
  2. Northern Star Resources Limited (NST): Northern Star Resources is a rapidly growing gold producer with a market capitalization of approximately AUD 11.6 billion. The company operates mines in Western Australia and Alaska and has a strong focus on cost control and operational excellence.
  3. Evolution Mining Limited (EVN): Evolution Mining is a leading gold producer with a market capitalization of approximately AUD 10.7 billion. The company operates mines in Australia and Canada and has a strong track record of delivering shareholder value.
  4. Saracen Mineral Holdings Limited (SAR): With a market capitalization of approximately AUD 9.9 billion, Saracen Mineral Holdings is a mid-tier gold producer with operations in Western Australia. The company has a strong track record of exploration success and growth.
  5. Resolute Mining Limited (RSG): Resolute Mining is a diversified gold producer with a market capitalization of approximately AUD 1.1 billion. The company operates mines in Australia and Africa and has a strong focus on operational excellence and sustainability.

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Fundamental Analysis of Top Gold Stocks in ASX

  1. Newcrest Mining Limited (NCM) – Market Cap AUD 23.6 billion

Newcrest Mining is one of the largest gold producers in Australia. The company operates mines in Australia, Papua New Guinea, and Canada and has a strong track record of exploration success. The company has a market capitalization of approximately AUD 23.6 billion.

Newcrest Mining reported a net profit after tax of AUD 647 million for the first half of fiscal year 2021, an increase of 134% from the previous corresponding period. The company also reported a production of 1.15 million ounces of gold during the same period, which is a 6% increase from the previous corresponding period. Newcrest Mining has a strong balance sheet, with cash and cash equivalents of AUD 800 million and total debt of AUD 2.3 billion.

  1. Northern Star Resources Limited (NST) – Market Cap AUD 11.6 billion

Northern Star Resources is a rapidly growing gold producer with a market capitalization of approximately AUD 11.6 billion. The company operates mines in Western Australia and Alaska and has a strong focus on cost control and operational excellence.

Northern Star Resources reported a net profit after tax of AUD 175 million for the first half of fiscal year 2021, an increase of 14% from the previous corresponding period. The company also reported a production of 536,363 ounces of gold during the same period, which is a 1% increase from the previous corresponding period. Northern Star Resources has a strong balance sheet, with cash and cash equivalents of AUD 490 million and total debt of AUD 176 million.

  1. Evolution Mining Limited (EVN) – Market Cap AUD 10.7 billion

Evolution Mining is a leading gold producer with a market capitalization of approximately AUD 10.7 billion. The company operates mines in Australia and Canada and has a strong track record of delivering shareholder value.

Evolution Mining reported a net profit after tax of AUD 301 million for the first half of fiscal year 2021, an increase of 22% from the previous corresponding period. The company also reported a production of 407,634 ounces of gold during the same period, which is a 3% increase from the previous corresponding period. Evolution Mining has a strong balance sheet, with cash and cash equivalents of AUD 250 million and total debt of AUD 843 million.

  1. Saracen Mineral Holdings Limited (SAR) – Market Cap AUD 9.9 billion

Saracen Mineral Holdings is a mid-tier gold producer with operations in Western Australia. The company has a market capitalization of approximately AUD 9.9 billion. The company has a strong track record of exploration success and growth.

Saracen Mineral Holdings reported a net profit after tax of AUD 135 million for the first half of fiscal year 2021, an increase of 163% from the previous corresponding period. The company also reported a production of 259,845 ounces of gold during the same period, which is a 24% increase from the previous corresponding period. Saracen Mineral Holdings has a strong balance sheet, with cash and cash equivalents of AUD 530 million and total debt of AUD 373 million.

  1. Resolute Mining Limited (RSG) – Market Cap AUD 1.1 billion

Resolute Mining is a diversified gold producer with a market capitalization of approximately AUD 1.1 billion. The company operates mines in Australia and Africa and has a strong focus on operational excellence and sustainability.

Resolute Mining reported a net profit after tax of AUD 39 million for the first half of fiscal year 2021, a significant increase from the previous corresponding period. The company also reported a production of 157,419 ounces of gold during the same period, which is a 39% increase from the previous corresponding period. Resolute Mining has a strong balance sheet, with cash and cash equivalents of AUD 56 million and total debt of AUD 167 million.

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How is the gold market in Australia? Will ASX gold stocks grow in future?

The future of gold market and stocks in Australia depends on a variety of factors such as global economic conditions, monetary policies, geopolitical risks, and demand from major consumers such as China and India. However, many analysts believe that gold and gold stocks have the potential to continue their growth in the future.

One of the main reasons for the potential growth of gold and gold stocks in Australia is the current global economic uncertainty and volatility. Gold is considered a safe-haven asset and a hedge against inflation, and as a result, investors tend to flock to gold during times of economic turmoil. With the ongoing COVID-19 pandemic and geopolitical tensions, the demand for gold is likely to remain strong in the foreseeable future.

Another factor that could contribute to the growth of gold and gold stocks in Australia is the monetary policies of central banks around the world. In response to the economic fallout from the pandemic, many central banks have implemented expansionary monetary policies, including low interest rates and quantitative easing. These policies have led to a weakening of fiat currencies, which in turn increases the appeal of gold as a store of value.

Overall, while there are no guarantees when it comes to investing, the current global economic and geopolitical conditions, as well as the ongoing monetary policies of central banks, suggest that gold and gold stocks have the potential to continue their growth in the future.

Factors Indicating Potential growth of Australian Gold Market

Here are some facts that support the potential growth of gold market and stocks in Australia:

  1. Gold prices have been on an upward trend over the past decade, with a 10-year annualized return of around 10%. Despite some fluctuations, gold prices have remained strong during the pandemic and geopolitical tensions.
  2. The demand for gold from major consumers such as China and India has remained strong. According to the World Gold Council, China and India together accounted for more than half of global gold demand in 2020.
  3. The monetary policies of central banks around the world, including the Reserve Bank of Australia, have led to a weakening of fiat currencies. This increases the appeal of gold as a store of value and a hedge against inflation.
  4. Australian gold production is expected to increase over the next few years. According to the Australian government’s resources and energy quarterly report, gold production is forecast to reach a record high of 372 tonnes in the 2021-2022 financial year.
  5. Many large investors, including hedge funds and institutional investors, have increased their investments in gold and gold stocks in recent years. This suggests a growing interest in gold as a safe-haven asset and a hedge against economic uncertainty.

Frequently Asked Questions (FAQs)

What is the correlation between the Australian dollar and the price of gold?

The Australian dollar (AUD) and the price of gold have a strong negative correlation, meaning that as the value of the AUD increases, the price of gold tends to decrease, and vice versa. This is because gold is priced in USD, and as the value of the AUD weakens against the USD, the price of gold in AUD terms tends to increase.

What are some of the key risks associated with investing in gold stocks in Australia?

Some of the key risks associated with investing in gold stocks in Australia include fluctuations in the price of gold, geopolitical risks, and operational risks. Fluctuations in the price of gold can impact the profitability of gold mining companies, while geopolitical risks such as trade tensions and political instability can impact the demand for gold.

Operational risks such as accidents, labor disputes, and environmental issues can also impact the financial performance of gold mining companies.

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