2 top gold stocks smart investors should be buying

Your portfolio may not be as diversified as you think…

| More on:

You鈥檙e reading a free article with opinions that may differ from The Motley Fool鈥檚 Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Gold miners are still out of favour with most investors after their disastrous performance in 2013, but as the S&P/ASX 200 (ASX: XJO) (INDEX: ^AXJO) continues to push higher and the valuations of top performing blue-chip stocks like Commonwealth Bank of Australia (ASX: CBA) and Westpac Banking Corp (ASX: WBC) rise, now is a smart time to consider adding exposure to this usually counter cyclical industry.

Although some smaller gold producers are notorious for being nothing more than highly volatile money pits, several of the larger listed miners demonstrate better stability and are producing positive cash-flows.

Newcrest Mining Limited (ASX: NCM) remains the ASX鈥檚 largest listed gold miner and its size drives economies of scale which in March helped to establish the company as one of the lowest cost gold producers.

After a dire 2013 the company is again back in cashflow positive territory and expects to remain positive in the 2015 financial year. Gold production is also expected to be higher than FY14, with estimates of between 2.2 to 2.4 million ounces for the year compared to between 2.0 and 2.3 million in FY14.

Newcrest has an exceptional gold reserve life of around 33 years which gives it additional credibility in a long-term portfolio.

A second stand-out miner is Northern Star Resources Ltd (ASX: NST), which after a recent series of brilliantly timed acquisitions is the ASX鈥檚 fifth-largest gold stock.

Northern Star has a low-cost production base and is targeting All-in Sustaining Costs of $1,050 per ounce, well below the current gold price of A$1,400 per ounce.

Motley Fool contributor Regan Pearson does not own shares in any of the companies mentioned in this article.

More on 鈴革笍 Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
鈴革笍 Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
鈴革笍 Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more

asx share price competitions represented by businessmen arm wrestling
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more

asx investor daydreaming about US shares
鈴革笍 How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more

person reading news on mobile phone
鈴革笍 Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more