Kinross Gold announced this week it had sold all of its Russian assets to the Highland Gold Mining Group for $340 million in cash, half of the previously announced price. The Toronto-based miner said in April it would sell its Kupol mine and Udinsk project to Highland Gold, one of the largest gold miners in Russia, for $680 million.
“The transaction consideration was adjusted by the parties following review by the recently formed Russian Sub-commission on the Control of Foreign Investments,” Kinross said, adding the sale was approved for a price not exceeding $340 million.
Kinross Gold stock comes with a 2.90% dividend. The BofA Securities price target is $7.65. That compares with a higher consensus target of $9.75 and Thursday’s closing price of $4.14.
Newmont
This is one of the largest mining companies and a solid buy for investors who are more conservative. Newmont Corp. (NYSE: NEM) is engaged in the production of gold.
Its North America segment consists primarily of Carlin, Phoenix, Twin Creeks and Long Canyon in Nevada and Cripple Creek and Victor in Colorado. The South America segment consists primarily of Yanacocha in Peru and Merian in Suriname. The Australia segment consists primarily of Boddington, Tanami and Kalgoorlie in Australia. The Africa segment consists primarily of Ahafo and Akyem in Ghana.
Shareholders receive a 3.40% dividend. Newmont stock has a $96 price objective at BofA Securities, but the consensus target is up at $118.55. Shares closed trading on Thursday at $64.71.
Wheaton Precious Metals
This precious metals royalty stock makes good sense for more conservative investors who are looking to have exposure to the sector. Wheaton Precious Metals Corp. (NYSE: WPM) is a Canadian precious metals streaming company with approximately 60% of its revenues from the sale of silver and 40% from gold.
Under the terms of long-term contracts, the company purchases silver and gold from a variety of mines, including Goldcorp’s Penasquito mine in Mexico, Vale’s Salobo mine in Brazil, the Lundin Mining Zinkgruvan mine in Sweden, and Glencore’s Antamina and Yauliyacu mines in Peru, and then sells the silver and gold into the open market.
Shareholders receive a 1.36% dividend. The BofA Securities price target of $56 compares with a $59.13 consensus target. Wheaton Precious Metals stock closed most recently at $38.92.
The SPDR Gold Trust (NYSE: GLD) exchange-traded fund is perhaps one of the best pure plays on gold for investors. The trust that sponsors the fund holds physical gold bullion, as well as some cash. Each share represents one-tenth of an ounce of the price of gold. Note though that the fund does not pay a dividend.
Proper asset allocation should always include at least a single-digit percentage holding of precious metals like gold and silver. Not only do they hedge inflation, which is huge now and could be over the long term, but they can really help if the market does go into correction or bear market mode, as they tend to trade inverse to markets.
Originally posted at 24/7 Wall St.
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