The existing bull market is now officially one of the longest on record – those tax cuts have been amazing. We hate to rain on anyone’s parade but according to history, every bull market is always followed by a bear market.
This is why investors are looking for safe-haven investments these days. And what is safer than gold? In this short guide, we are going to cover the three top precious-metal stocks worth your attention.
Before we begin…
The most obvious way to invest in gold is to buy some. But that doesn’t mean you should just go out and buy a gold necklace – that’s a terrible way to invest in gold (considering the exorbitant jewelry markups).
That’s why the most savvy investors prefer to invest in royalty and streaming companies.
The 3 leading companies – Franco-Nevada, Royal Gold, and Wheaton Precious – do not operate any mines.
Instead, they offer miners with cash (upfront) in exchange for the right to buy silver, gold, and other metals at considerably lower prices in the future. This cash is used by the miners to expand current assets, build mines, or to solidify their balance sheets.
Most royalty companies also buy existing royalties from third parties.
3 Solid Streaming Companies in the Market
Now that you know the basics, let’s talk about the companies.
Wheaton likes to invest in a small number of hefty mine streams. The company has investments in 19 working mines and 9 soon-to-be-open projects as of this moment.
According to the investors, what makes Wheaton such an attractive opportunity is its balanced mix between silver and gold.
Both these metals generally perform best when the stock market is doing badly. That’s precisely why the investors often switch to precious metals when the stock market begins to perform poorly.
This means that even if the rest of your portfolio is getting hit, the Wheaton’s stock will continue to rise. The company’s current yield is 1.5%.
It has 51 operating mines, with 202 exploration properties and 37 in an advanced development stage. Since this company also invests heavily in oil and natural gas drilling projects, investors find it a mixed blessing. The company’s goal is to produce 80% of its revenue from precious metals.
Their current yield is 1.3%. Franco-Nevada has increased its dividend annually for the last 11 years, which is notable.
It has 191 investments in its current portfolio, making it highly diversified. Even though only 41 are operating as of this moment, 133 are in an early development stage or exploration, and 17 are in advanced development. Gold accounts for 70% of its total production.
The important thing to note is Royal Gold’s dividend, currently 1.3%, has grown for 18 consecutive years. That is a 19% compound average growth rate in dividends.
This article contains the author's opinions. These are not investment-related recommendations. Do not consider the article as any type of commercial solicitation or an investment product offer.
About the Company
Ely Gold Royalties Inc.is an emerging royalty company with development assets focused in Nevada and the Western US. Its current portfolio, which includes a large number of Deeded Royalties and Optioned Properties, is currently generating significant revenue.
Ely Gold’s royalty portfolio includes producing royalties, fully permitted mines, mines under construction and development projects that are being permitted for mine construction.