After reaching record highs, gold investing took a hit and came in for some profit booking. This was driven by data showing resilience in U.S. economy, which is deterring the sharp rate cuts by the Fed. However, the momentum in best gold mining stocks is likely to continue in the short to medium term.
The gold companies to invest in currently are
Resolute Mining Limited (ASX: RSG)
Resolute Mining Limited faced a mixed quarter In Q3 2024. Despite heavy rainfall and challenges at its Mako and Syama mines, the company produced 85,043 ounces of gold, slightly below expectations. The extreme rains at Mako caused pit flooding and hindered mining operations for about four weeks, while the lower-than-expected ore grades also impacted results. However, the company continued to generate substantial free cash flow of nearly $50 million, ending the quarter with a strong cash position of $145.6 million, up from $96.6 million in Q2.
Production from Syama in Mali reached 52,991 ounces of gold, at an All-In Sustaining Cost of $1,533/oz, with sulphide operations exceeding expectations. However, rainfall affected mining, and a rise in royalty rates due to higher gold prices increased costs. For Mako, in Senegal, its AISC was approximately $1,125/oz, producing 32,052 ounces of gold, but production was impacted by the extreme weather and negative grade reconciliations. Mako's guidance for production for 2024 is now around 130,000 ounces, having been guided down to reflect the mine's ongoing challenges.
Exploration spending in Q3 amounted to $6.3 million, with drilling programs ongoing across Resolute’s portfolio in Senegal, Mali, and Guinea. The Tomboronkoto resource in Senegal increased by 30%, with 87% of the resource now in the Indicated category. In Guinea, an initial resource estimate of 343,000 ounces of gold was made at Mansala, while in Mali, drilling continued to define and upgrade resources at Syama North and nearby satellite deposits.
Resolute, one of the top gold stocks, is on track to meet or slightly miss its 2024 production targets, with total group production expected at the lower end of its guidance (345-365koz). However, it remains focused on cost discipline, organic growth, and exploration success. The company’s recent joint venture agreement on the La Debo project in the Ivory Coast adds to its asset diversification strategy. With a robust balance sheet, including $140 million in secured financing and A$20 million from the Ravenswood sale, Resolute is well-positioned for future growth and operational resilience.
Red Hill Minerals Limited (ASX: RHI)
Red Hill Minerals Limited presented a strong quarterly update on 30 October 2024, highlighting key milestones in its royalty and exploration portfolio. The company received the second and final $200 million payment from Mineral Resources Limited following the First Ore on Ship milestone at the Onslow Iron Project. Additionally, Red Hill reported its first royalty payment from a 0.75% FOB revenue stream, totaling $282,000 for June shipments and $1.08 million in revenue for the September quarter. This royalty income marks a significant revenue stream as production at Onslow Iron ramps up, targeting an annual throughput of 35 million tonnes. Red Hill maintained a robust cash position, reporting $84.6 million at quarter-end despite a substantial $96.2 million fully franked dividend payment in July and $39 million in income tax settlements. This financial strength underscores Red Hill’s strategic capital management and commitment to shareholder returns, further emphasized by a $1.50 per share fully franked dividend declared post-yearend.
On the exploration front, Red Hill advanced its West Pilbara Gold and Base Metals projects, completing 2,470 meters across 12 reverse circulation (RC) drill holes at the Barkley Gold target. In its Curnamona Earn-in Joint Venture, Red Hill met all conditions and executed formal JV documents with Peel Mining Limited. This agreement enables Red Hill to earn up to a 75% stake in the Broken Hill and Anabama Projects, with a commitment of $6.5 million over five years, including a minimum spend of $1.5 million. Exploration spending totaled $5.1 million in FY24, demonstrating Red Hill’s systematic approach to identifying and developing resource opportunities.
Red Hill is among the gold stocks with dividends. It closed FY24 with a solid financial performance, reporting a profit after tax of $153.5 million, aided by income from the Onslow Iron Project stake disposal and royalty commencement. Red Hill has consistently prioritized shareholder returns, issuing two fully franked dividends of $0.10 per share during the fiscal year and a $1.50 per share dividend post-yearend. Since October 2021, Red Hill has maintained a semi-annual dividend schedule, a testament to its commitment to sustained shareholder value. With ongoing royalty revenue, strong cash reserves, and a well-funded exploration program, Red Hill appears well-positioned for scalable growth. The anticipated production ramp-up at Onslow Iron further underscores Red Hill’s long-term growth potential as the company seeks to diversify its asset base while delivering consistent returns to shareholders.
(Source: Company’s Report)
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