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Over one year, the price of gold went up 41%, surging to an all-time high of $3,500/oz in April. Just like Bitcoin, a digital commodity, gold benefited from the persistent erosion of fiat currency value due to inflation. Profligate government spending beyond its means appears to be set in stone, securing inflation as a constant theme moving forward.
Furthermore, the geopolitical instability spurred central banks to accumulate gold. The People’s Bank of China (PBoC) alone increased its gold reserves for seven consecutive months, rising to 73.83 million (~$242 billion) fine troy ounces by the end of May.
In the meantime, the Federal Reserve is still the world’s largest holder of gold at around 8,133 tonnes. Befitting their vassal status in relation to the US, Germany and Italy delegated the Federal Reserve in New York to hold around $245 billion combined worth of gold. In total, Germany and Italy are the world’s 2nd and 3rd largest holders of gold with a combined reserve of ~5,804 tonnes. At press time, the price of gold is down nearly 1% over a month, at $3,354 per troy ounce. At this level, is this an opportunity to gain exposure to projected new all-time gold price highs in 2026?
1. Newmont Corporation
In Q1 2025 ending March, this Colorado-based gold company elevated its free cash flow (FCF) to a record high of $1.2 billion, up from negative $74 million in the year-ago quarter. Given the cyclical nature of gold mining and heavy capital expenditures, FCF is especially important for this sector.
Against its $7.8 billion debt, Newmont (NYSE:NEM) now holds $4.7 billion in cash balance, which is well above the company’s target of $3 billion. During 2025, the company also engaged in $755 million worth of stock buybacks from the $3 billion repurchase program. Newmont pays $0.25 quarterly dividend per share.
Following the announcement in early 2024, Newmont completed up to $3.8 billion worth of divestitures of six non-core operations, such as Musselwhite, Éléonore, Akyem and Porcupine, which were spread across Australia, Canada, Ghana and the US.
Year-to-date, NEM stock is up 57%, currently priced at $58.53 per share. According to WSJ’s forecasting data, the average NEM price target is $66.04, with the bottom of $56 aligned with the current price level. Most analysts recommend buying at this moment, 15, while 8 are holding. No analysts recommend selling NEM stock.
2. Agnico Eagle Mines Ltd.
Agnico Eagle Mines (NYSE:AEM) is another gold stock that is roughly aligned with its bottom price forecast, currently priced at $117.57 vs the expected bottom of $116 per share. The average AEM price target has significant upward potential at $141.77 per share, with only one analyst recommending selling while 15 recommend buying at this price point.
Headquartered in Toronto, Agnico is running 11 mines, most of which are in Canada but also in Finland, Australia and Mexico. As of Q1 2025, the company has an exceptionally low debt of $90 million vs $1 billion in total long-term obligations. At the same time, Agnico has $2 billion available in undrawn credit, in addition to $1.1 billion in cash reserves.
During Q1, Agnico reached $594 million free cash flow, up from $396 million FCF in the year-ago quarter. In addition to acquiring new mines and reinvesting, a significant chunk of Agnico’s cash flow goes to stock buybacks, currently giving $0.40 quarterly dividend per share.
For full year 2025, Agnico expects 1,030 thousand ounces (koz) gold production with total cash costs of $987/oz. Owing to future underground mining in Canadian Odyssey, at ~550 koz/year the company is looking at 1 Moz annual gold production.
Year-to-date, AEM stock is up nearly 50%. While the average AEM price target is $141.77, the ceiling price is $173 per share.
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Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.
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