Is buying ASX gold shares right now a good idea?

The ASX All Ords Gold Index is up 23% since February. Is it too late to buy gold stocks now?

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Investors who snapped up ASX gold shares on 28 February should be sitting on some outsized gains today.

That's because 27 February marked the beginning of the sizzling run higher for the gold price.

Just what kind of sizzling run are we talking about?

Well, on 27 February gold was trading for US$2,030 per ounce, already well above the US$1,820 that same ounce was fetching on 5 October.

But amid strong central bank buying, the prospect of lower interest rates on the horizon from global central banks, and increased demand for haven assets, the gold price charged higher from there to hit new records on 20 May.

While bullion has retraced a touch from those highs, it's still commanding US$2,336 per ounce today. This sees the yellow metal up 15.1% since the end of February.

As you'd expect, that's been a boon for most ASX gold shares.

Indeed, since market close on 28 February, the S&P/ASX All Ordinaries Gold Index (ASX: XGD) has rocketed 23.0%. For some context the All Ordinaries Index (ASX: XAO) is up 1.4% over this same period.

But with that kind of outperformance already in the bag, is now still a good time to buy ASX gold shares?

Why ASX gold shares could keep shining bright

A range of company-specific factors will determine how well any single ASX gold share will perform over the coming years.

But what happens with the gold price will impact them all.

On that front, UBS has upgraded four ASX gold shares, labelling the Aussie gold sector as "relatively attractive".

As The Australian reports UBS has upgraded its outlook for Northern Star Resources Ltd (ASX: NST), Genesis Minerals Ltd (ASX: GMD), Regis Resources Ltd (ASX: RRL) and SSR Mining Inc (ASX: SSR).

The upgrades come amid the broker's upwardly revised expectations for the gold price.

UBS' analysts have increased their 2025 gold price target by 21% to US$2,700 per ounce. The broker also increased its 2026 price forecast by 34% to US$2,775 per ounce. And UBS' revised 2027 gold price forecast of US$2,600 per ounce is up 30% from the prior forecast.

In Aussie dollars that would see the 2025 gold price at AU$4,053 per ounce.

Taking ASX gold share Northern Star as one example, the miner's March quarterly report revealed it was producing gold at an all-in sustaining cost (AISC) of AU$1,844 per ounce (US$1,213/oz). So we're talking about some hefty potential profit margins here.

Commenting on the upgrades for the ASX gold shares, UBS analysts said:

We have previously flagged some moderate risks around FY 2025 guidance and medium-term cost profiles and have taken the opportunity to update this, but this pales in comparison to the prospect of nearly AU$4,000 per ounce gold.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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