In this article, we discuss 10 gold stocks that pay dividends.
On May 11, the United States Department of Labor released consumer price data for the month of April, revealing that the consumer price index had risen by 0.3% over the period, the smallest gain registered since August 2021. The numbers indicated that inflation may have peaked and was headed in the opposite direction, serving to cool the concerns around a more aggressive rate hike by the central bank. Gold prices were up slightly after the data was made public, with spot gold up 0.8% to $1,852.15 per ounce as gold futures gained 0.7% to $1,852.80.
Gold is generally considered the safest inflation hedge, but this reputation has been challenged in recent years as high-tech alternatives like Bitcoin or inflation-resistant growth stocks hold their own during periods of economic crisis. Market experts are still skeptical that these alternatives can carry the weight that gold does in a recession. Phillip Streible, the chief market strategist at Blue Line Futures in Chicago, told CNBC on May 11 that he would “much rather own gold than NASDAQ or Bitcoin” in the present market.
In addition to providing cover against a crisis, investments in gold stocks make sense from a dividend perspective as well. Some of the top gold stocks that pay dividends include Newmont Corporation (NYSE:NEM), Barrick Gold Corporation (NYSE:GOLD), and Freeport-McMoRan Inc. (NYSE:FCX).
Our Methodology
The companies that operate in the gold sector and pay dividends were selected for the list. The business fundamentals and analyst ratings for these firms are also discussed to provide readers with some additional context for their investment choices. An extensive database of around 900 elite hedge funds tracked by Insider Monkey in Q4 2021 was used to quantify the hedge fund sentiment around each stock.
Gold Stocks that Pay Dividends
10. Gold Resource Corporation (NYSE:GORO)
Number of Hedge Fund Holders: 11
Dividend Yield as of May 12: 2.19%
Gold Resource Corporation (NYSE:GORO) develops and produces gold and silver projects. The stock, priced modestly at $1.82 per share as of May 12, is one of the strongest dividend players in the gold universe, with a history of consistent payouts stretching back over a decade. In the past five years, these dividend payments have been steadily growing as well. On April 29, the company declared a quarterly dividend of $0.01 per share, in line with previous. The dividend is payable to shareholders by late June.
On May 9, Gold Resource Corporation (NYSE:GORO) posted earnings for the first quarter of 2022, reporting earnings per share of $0.05 and a revenue of more than $45 million, up over 66% compared to the revenue over the same period last year.
At the end of the fourth quarter of 2021, 11 hedge funds in the database of Insider Monkey held stakes worth $5.1 million in Gold Resource Corporation (NYSE:GORO), up from 10 in the previous quarter worth $5.6 million.
Just like Newmont Corporation (NYSE:NEM), Barrick Gold Corporation (NYSE:GOLD), and Freeport-McMoRan Inc. (NYSE:FCX), Gold Resource Corporation (NYSE:GORO) is one of the gold stocks on the radar of elite investors as inflation rises.
9. Hecla Mining Company (NYSE:HL)
Number of Hedge Fund Holders: 19
Dividend Yield as of May 12: 0.71%
Hecla Mining Company (NYSE:HL) is a precious metals mining firm. The company has an impressive dividend history stretching back eleven years. In the past two years, the company has steadily grown the dividend payout. The sector median in this regard is just one year. On May 10, the firm declared a quarterly dividend of $0.0063 per share, in line with previous. The firm disclosed that $0.00375 per share was the minimum dividend component and $0.0025 per share was for the silver-linked component.
On May 11, Roth Capital analyst Joe Reagor upgraded Hecla Mining Company (NYSE:HL) stock to Buy from Neutral but lowered the price target to $6.25 from $6.50, noting that the firm had posted earnings below expectations but the valuation presented a buying opportunity.
At the end of the fourth quarter of 2021, 19 hedge funds in the database of Insider Monkey held stakes worth $128 million in Hecla Mining Company (NYSE:HL), up from 15 in the preceding quarter worth $101 million.
8. Royal Gold, Inc. (NASDAQ:RGLD)
Number of Hedge Fund Holders: 28
Dividend Yield as of May 12: 1.19%
Royal Gold, Inc. (NASDAQ:RGLD) purchases and manages precious metal streams, royalties, and related interests. The company posted earnings for the first fiscal quarter on May 4, reporting earnings per share of $1.00, beating market estimates by $0.04. The revenue over the period was $162 million, beating analysts’ estimates by $6.4 million. The firm disclosed that it had generated 71% of the revenue from gold, 10% from silver, and 14% from copper. The production volume in the quarter was up 9% year-on-year.
On April 21, Barclays analyst Matthew Murphy kept an Equal Weight rating on Royal Gold, Inc. (NASDAQ:RGLD) stock and raised the price target to $128 from $122, noting that the gold geopolitical premium was getting a boost from recession fears.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm First Eagle Investment Management is a leading shareholder in Royal Gold, Inc. (NASDAQ:RGLD), with 3.5 million shares worth more than $369 million.
In its Q1 2021 investor letter, Argosy Investors, an asset management firm, highlighted a few stocks and Royal Gold, Inc. (NASDAQ:RGLD) was one of them. Here is what the fund said:
“Gold royalties business achieve 2 objectives for us: 1) It’s a good business model with strong returns through the gold price cycle; and 2) it provides some protection from inflation, should it materialize due to the increasingly loose fiscal and monetary policy decisions the United States (and other developed market economies) is making.
I don’t want to stay on my soapbox for too long, but this is the first time in history that I’m aware of politicians openly stating that debt levels don’t matter, even in the long term. In 2019, the government spent $4.4 trillion. Of those expenditures, $0.4 trillion was spent making interest payments on existing debt at the time of $16.9 trillion. The interest rate on that debt was 2.4%. Debt for 2021 is projected to increase to $22.5 trillion, and then to $33 trillion by the end of the decade.
I don’t have a crystal ball, but if interest rates increased to previously “normal” levels of only 5%, U.S. interest payments would be over $1.1 billion in 2021, 25% of U.S. total expenditures in 2019. In the event that happens, there are a few choices: 1) run a larger deficit which could lead to accelerating debt levels; 2) reduce government spending on things like the military, Medicare, Social Security, pensions, and other programs; or 3) the government allows or encourages inflation to reduce the value of its debt obligations. (Click here to see full text)
7. Rio Tinto Group (NYSE:RIO)
Number of Hedge Fund Holders: 22
Dividend Yield as of May 12: 12.30%
Rio Tinto Group (NYSE:RIO) is a diversified metals and mining firm. On April 7, the company announced that it would be taking full control over an alumina refinery in Australia that it owns in partnership with United Company Rusal, a Russian firm. The Australian government has sanctioned Russian businesses in the country in the wake of the Ukraine war. With Rio taking control, the Russian firm has been deprived of a key source of raw material required to produce aluminum, one of the most important metals for the weapons industry.
On April 20, Citi analyst Ephrem Ravi upgraded Rio Tinto Group (NYSE:RIO) stock to Buy from Neutral and raised the price target to GBP 70 from GBP 59, noting that despite “softer” production numbers, the firm had maintained 2022 guidance on production and costs recently.
Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Rio Tinto Group (NYSE:RIO), with 13.5 million shares worth more than $907 million.
6. Wheaton Precious Metals Corp. (NYSE:WPM)
Number of Hedge Fund Holders: 24
Dividend Yield as of May 12: 1.52%
Wheaton Precious Metals Corp. (NYSE:WPM) is a Canada-based firm that sells precious metals. The company has been consistently paying a dividend to shareholders for the past ten years. Over the last six of these years, the payouts have registered a healthy growth as well. On May 5, the firm declared a quarterly dividend of $0.15 per share, in line with previous. The company also beat market expectations on earnings per share for the first quarter of 2022 by $0.01. The revenue over the period was $307 million.
On April 21, Barclays analyst Matthew Murphy maintained an Equal Weight rating on Wheaton Precious Metals Corp. (NYSE:WPM) and raised the price target to $49 from $45, underlining that the “broad commodity tape has been supportive for the resource equities”.
At the end of the fourth quarter of 2021, 24 hedge funds in the database of Insider Monkey held stakes worth $490 million in Wheaton Precious Metals Corp. (NYSE:WPM), compared to 27 in the previous quarter worth $347 million.
In addition to Newmont Corporation (NYSE:NEM), Barrick Gold Corporation (NYSE:GOLD), and Freeport-McMoRan Inc. (NYSE:FCX), Wheaton Precious Metals Corp. (NYSE:WPM) is one of the gold stocks that hedge funds are buying as interest rates rise.
5. Franco-Nevada Corporation (NYSE:FNV)
Number of Hedge Fund Holders: 29
Dividend Yield as of May 12: 0.91%
Franco-Nevada Corporation (NYSE:FNV) is a gold-focused royalty and streaming company. The firm has an impressive track record in the dividend space, considering it has paid a dividend to shareholders consistently for the past thirteen years. The sector median in this regard is just eleven years. Over the past two years, these payouts have been growing as well. On May 4, the firm declared a quarterly dividend of $0.32 per share, in line with previous. The dividend is payable to shareholders by the end of June.
On April 19, KeyBanc analyst Adam Josephson kept an Overweight rating on Franco-Nevada Corporation (NYSE:FNV) stock and raised the price target to $180 from $150, noting that the target raised reflected the higher commodity prices.
At the end of the fourth quarter of 2021, 29 hedge funds in the database of Insider Monkey held stakes worth $1 billion in Franco-Nevada Corporation (NYSE:FNV), up from 26 in the preceding quarter worth $951 million.
4. Kinross Gold Corporation (NYSE:KGC)
Number of Hedge Fund Holders: 31
Dividend Yield as of May 12: 2.78%
Kinross Gold Corporation (NYSE:KGC) acquires, explores, and develops gold properties. The company recently posted earnings for the first quarter of 2022, reporting earnings per share of $0.06 and a revenue of $768 million. The stock has also gained recently on the back of reports that Barrick Gold, another gold giant, is interested in buying out the company. Kinross has been divesting Russian assets in the wake of the Ukraine invasion and has recently cut production guidance for 2022 to reflect these developments.
On April 27, investment advisory Stifel maintained a Buy rating on Kinross Gold Corporation (NYSE:KGC) stock but lowered the price target to C$11.5 from C$14. Analyst Ingrid Rico issued the ratings update.
At the end of the fourth quarter of 2021, 31 hedge funds in the database of Insider Monkey held stakes worth $365 million in Kinross Gold Corporation (NYSE:KGC), up from 27 in the previous quarter worth $321 million.
3. Newmont Corporation (NYSE:NEM)
Number of Hedge Fund Holders: 45
Dividend Yield as of May 12: 3.35%
Newmont Corporation (NYSE:NEM) produces and explores for gold. Tom Palmer, the CEO of the firm, has recently said that the company plans to move ahead with plans to invest $2 billion into a mine expansion project in Peru. The firm has already committed $500 million in funding to this plan. Newmont also plans to expand into copper production as part of this plan. The investment will boost the government of Peru that has witnessed two of the largest copper mines in the country suspend production following conflicts with indigenous communities.
Newmont Corporation (NYSE:NEM) has paid a dividend to shareholders consistently for the past three decades. These payouts have grown over the past two years. On April 21, the company declared a quarterly dividend of $0.55 per share, in line with previous.
At the end of the fourth quarter of 2021, 45 hedge funds in the database of Insider Monkey held stakes worth $1.3 billion in Newmont Corporation (NYSE:NEM), compared to 48 in the preceding quarter worth $774 million.
In its Q3 2021 investor letter, First Eagle Investment Management, an asset management firm, highlighted a few stocks and Newmont Corporation (NYSE:NEM) was one of them. Here is what the fund said:
“The largest gold miner in the world, Newmont Corporation (NYSE:NEM) shares lost ground in what was a volatile and ultimately down quarter for the price of gold. The Colorado-based company has continued to execute well in what has been a challenging environment. The company recently reaffirmed its full-year 2021 production guidance, but indicated that it was likely to come in at the mid to low point of the range provided as a result of disruptions from Covid-19 as well as severe weather events. It also noted that inflation pressures were likely to push its costs higher in 2021. None of this changes our opinion of the stock, which has historically offered steady production anchored in good jurisdictions, a good pipeline of organic projects, a strong balance sheet and proven management.”
2. Barrick Gold Corporation (NYSE:GOLD)
Number of Hedge Fund Holders: 46
Dividend Yield as of May 12: 1.88%
Barrick Gold Corporation (NYSE:GOLD) is a mining firm with prime interests in gold and copper. On May 4, the firm posted earnings for the first quarter of 2022, reporting earnings per share of $0.26, beating market estimates by $0.02. The revenue over the period was $2.85 billion, beating expectations by $100 million. The firm also disclosed that it had generated free cash flows of $393 million during the quarter. The company has paid a dividend to shareholders consistently for the past 25 years.
On April 20, National Bank analyst Mike Parkin maintained a Sector Perform rating on Barrick Gold Corporation (NYSE:GOLD) stock and raised the price target to C$38 from C$29. Barclays also recently raised the price target on the stock.
At the end of the fourth quarter of 2021, 46 hedge funds in the database of Insider Monkey held stakes worth $958 million in Barrick Gold Corporation (NYSE:GOLD), up from 41 the preceding quarter worth $917 million.
In its Q1 2022 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Barrick Gold Corporation (NYSE:GOLD) was one of them. Here is what the fund said:
“Also within the structural bucket, we have selectively added to our commodity exposure with the purchase of Barrick Gold Corporation (NYSE:GOLD). Canadian mining company Barrick Gold is a play on operating improvements. The company has aggressively delevered its balance sheet and reduced capex spending to a lower level more permanently, directing its healthy free cash flow to dividends and buybacks.”
1. Freeport-McMoRan Inc. (NYSE:FCX)
Number of Hedge Fund Holders: 66
Dividend Yield as of May 12: 1.66%
Freeport-McMoRan Inc. (NYSE:FCX) is an Arizona-based minerals and mining firm. In the first quarter of 2022, the gold sales of the company climbed by 59% to 409,000 recoverable oz. During the period, the realized price for gold gained 12% to $1,920/oz. In the first three months of the year, gold sales for the firm were 8% higher than prior guidance of 380,000 oz, primarily reflecting higher recoveries. The stock has gained more than 20% in the past few months as rising inflation increases interest in gold purchases.
Freeport-McMoRan Inc. (NYSE:FCX) posted earnings for the first quarter of 2022 in late April, reporting earnings per share of $1.07, beating market estimates by $0.15. The revenue over the period was $6.6 billion, up 36% year-on-year.
At the end of the fourth quarter of 2021, 66 hedge funds in the database of Insider Monkey held stakes worth $3.7 billion in Freeport-McMoRan Inc. (NYSE: FCX), the same as in the preceding quarter worth $3.2 billion.
In its Q4 2021 investor letter, Horizon Kinetics LLC, an asset management firm, highlighted a few stocks and Freeport-McMoRan Inc. (NYSE:FCX) was one of them. Here is what the fund said:
“Those were some ideas about copper demand. Here are some specifics about supply. Global copper mine production in the 10 years from 2005 to 2015 rose 2.45% annually. In the next 5 years, to 2020, it increased by only 0.9% annually. Even ignoring the 2020 pandemic year, for the 4 years from to 2019, the expansion rate was 1.66%. We already have the historical context for this: the commodity price collapse prior to 2015, from a position of excess capacity.
What producers must do in that situation, because they have high fixed costs and debt expense, is curtail their exploration and development expenditures and reduce operating costs. They rely on existing mines, instead, and on their highest-grade ores and lowest-cost production. They might not actually reduce current production, but they aren’t replacing the reserves that are being slowly drawn down. You can see this at work at the individual company level.
Freeport-McMoRan Inc. (NYSE:FCX) will illustrate. It is the world’s third-largest copper producer, closely following Chile’s Codelco and Australia’s BHP Group. In 2014, even though Freeport sold more copper than the prior year, its revenues dropped by over 25%, and it went from $4.8 billion of operating earnings (a 22% margin) to a $(0.2) billion loss. The company’s capital expenditures peaked in 2014 at $3.86 billion and will be about $1.72 billion in 2021, meaning the company is spending 55% less now than it was seven years ago. In inflation-adjusted terms, it’s spending 61% less today than seven years ago…” (Click here to see the full text)
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Disclosure. None. 10 Gold Stocks that Pay Dividends is originally published on Insider Monkey.
