Gold mining companies are experiencing an unprecedented financial boom, as they are flooded with cash after 3 years of rising prices for the yellow metal.
According to a report published by Forbes magazine, gold prices – which witnessed a 30% rise over the past year with the support of purchases by central banks and investment institutions – contributed to providing huge profits for mining companies.
Great heights
At the top of the list of companies that achieve large profits is Newmont Corporation, the largest gold mining company in the world – according to the investment bank Goldman Sachs. Its shares listed in New York could rise by 17% to reach $47.20, while listed shares are expected to rise. In Australia, from 64.80 to 76.20 Australian dollars.
Goldman Sachs expects that strong demand from central banks will continue to raise the price of gold to $3,000 per ounce, compared to the current price of $2,670, while maintaining these levels until the middle of next year.
The long-term price forecast for gold has also been revised from $1,950 to $2,300 per ounce by 2029.
Investment opportunity
The report indicates that Australian and international gold stocks did not achieve the same performance as gold, as they lagged by 10% compared to the significant rise in the prices of the yellow metal.
However, companies like Northern Star Resources and Bellevue Gold have attracted buy recommendations from major investment banks thanks to strong production and growing free cash flow.
Forbes notes that smaller companies such as Alkan Resources represent attractive investment opportunities despite being exposed to significant declines in stock prices, as the company’s stock has fallen by 25% over the past 12 months, but its value is expected to rise by 155% to reach 1.25 Australian dollars, supported by stable production. From the Tomingley mine.
