The list of the biggest gold mining companies in the world includes many publicly-traded companies, which can be good investment opportunities for investors seeking to diversify their portfolio and get some exposure to the precious metal. Whether you want to invest in physical gold or one of the biggest gold mining companies in the world, there are benefits and drawbacks to both and we will discuss some of them.
Through history, gold has been a popular investment. The investor sentiment towards it fluctuates through time depending on the economic situation and the state of stock and bond markets, but many investors looking to build a diversified equity portfolio or seeking ways to hedge against potential market fluctuations often choose to allocate a portion of their capital towards gold. In 2017, even though the market continued its bull run and hit several record-highs, gold prices nonetheless gained around 13%, as investors drew the demand for the precious metal higher in fear of a big correction (take a look at some stocks that you should own in case of a correction).
In 2018, gold prices are expected to continue their appreciation, as the Fed has signaled that it might speed up tightening monetary policy and across the pond the ECB is considering scaling back monetary stimulus. In addition, as gold prices are quoted in US dollars, its price should see more upside as the greenback might slid amid higher interest rates and some degree of uncertainty surrounding President Trump’s economic agenda.
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Two of the most common ways of investing in gold is to buy physical gold or to invest in a ETF that tracks gold prices. Investing in physical gold is cumbersome, as it involves costs associated with transportation and storage. On the other hand, buying shares of an ETF like SPDR Gold Shares (NYSEARCA:GLD) is much easier, can be done through most online brokerages from the comfort of your home or office and the shares are more liquid, so they can be bought and sold faster.
However, owning physical gold is not always the best way to get exposure to the precious metal. An investor also has the option to buy stocks of gold mining companies. The advantage of investing in a gold miner rather than a physical gold is that the increase in gold prices has a bigger impact on gold miners’ profitability. For example, let’s assume that the price per ounce of gold increases by 5% to $1,050 from $1,000. If you own physical gold, your return is 5%. However, if a gold mining company has the same $500 cost of production per ounce, its profit grows by 10%. Of course, it’s all theoretical and in a real-life situation there are many other factors to take into account when it comes to investing in gold miners. Another benefit is that most gold miners don’t mine just gold, but other metals and minerals as well, such as zinc, copper, or uranium, which offers more diversification.
However, there are also drawbacks. When one invests in a gold mining company, they bet that the company will perform as efficiently as possible and the management is committed to maximize shareholder value, which, unfortunately, is not always the case. In addition, the same math that we described for gold prices growth is true for the reverse situation, so when gold prices fall, a company stands to lose more in terms of profitability. In the end, whether you choose to invest in a gold mining company or physical gold depends on your preferences and investment style. Many investors hold both gold ETFs and gold-mining stocks, but if you are looking for a way to get exposure to gold as insurance against a market drop, you should focus more on gold ETFs, or, even better, the bullion itself. If you want to profit from gold prices growth, you should go for gold miners.
So, if you want to add stocks of some gold miners to your portfolio, then this list of the biggest gold mining companies in the world should prove useful. Of course, even though size does matter, bigger isn’t always better and you should do your homework and analyze the companies you want yo invest in in more detail. To give you a place to start we will also mention the hedge fund sentiment towards those stocks that are publicly traded on the US stock market. Choosing the stocks that rank as the most popular among hedge funds can bring you closer to beating the market, as our flagship “Best Performing Hedge Funds Strategy” shows. Our strategy focuses on the consensus picks of the top 100 best performing hedge funds every quarter and it has returned 74.4% since May 2014, beating the S&P 500 ETF (SPY) by almost 25 percentage points. You can access the latest picks from our strategy by checking out our newsletters free of charge for 14 days.
Having said that, let’s take a closer look at 13 biggest gold mining companies in the world.
13. Yamana Gold Inc. (AUY)
Total Production (ounces): 977,316
Yamana Gold Inc. (NYSE:AUY) is a Canadian gold producer, which operates six mines in Canada, Brazil, Chile, and Argentina. In addition to gold, Yamana Gold Inc. (NYSE:AUY) produces silver and copper. Last year, the company’s gold production exceeded its estimates by 2%, but was 3% lower than in 2016. In 2018 and 2019, Yamana Gold Inc. (NYSE:AUY) estimates gold production at 900,000 ounces and 940,000 ounces, respectively. At the end of 2017, there were 15 hedge funds in our database holding roughly 4.60% of Yamana Gold Inc. (NYSE:AUY)’s outstanding stock.
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12. Sibanye Gold Ltd (SBGL)
Total Production (ounces): 1,402,900
Sibanye Gold Ltd (ADR) (NYSE:SBGL) is the largest gold producer in South Africa and one of the largest producers of platinum and palladium in the world. The company is currently in the process of acquiring Lonmin plc, which should expand its production of platinum and propel it to the second-largest platinum producer in the world. Last year, Sibanye Gold Ltd (SBGL)’s gold production declined by 7.2%. There were just eight funds long Sibanye Gold Ltd (ADR) (NYSE:SBGL) heading into 2018.
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11. China National Gold Group Corporation
Total Production (ounces): 1,496,322
China National Gold Group Corporation is the largest gold producer in China, which reported a profit of around $120 million last year. The company is centrally state owned and aside gold it is also engaged in mining and refining of silver, copper, and molybdenum. China National Gold Group Corporation’s main mines are in Inner Mongolia and Tibet and the company is reportedly looking at acquisitions in other countries to expand its production.
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10. Agnico Eagle Mines Ltd (AEM)
Total Production (ounces): 1,713,533
Agnico Eagle Mines Ltd (USA) (NYSE:AEM) is headquartered in Canada, but also has mines in Mexico and Finland and exploration and development activities in Canada, Europe, Latin America and the United States. Its by-product metals include silver, zinc, and copper. In 2017, Agnico Eagle Mines Ltd (USA) (NYSE:AEM) saw gold production jump from 1.66 million ounces in 2016 and 1.67 million ounces in 2015. In 2018, Agnico Eagle Mines Ltd (USA) (NYSE:AEM) expects gold production of around 1.525 million ounces. At the end of 2017, 21 funds tracked by Insider Monkey held long positions in Agnico Eagle Mines Ltd (USA) (NYSE:AEM).
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9. Navoi Mining & Metallurgy Combinat
Total Production (ounces): 2,152,000 (estimated)
Navoi Mining & Metallurgy Combinat is a state-owned Uzbek company that in addition to being one of the biggest gold mining companies in the world is also one of the world’s top producers of uranium. The company’s main ore deposits are located in the Kyzyl Kum Desert.
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8. PJSC Polyus
Total Production (ounces): 2,160,000
PJSC Polyus is the largest gold producer in Russia, which operates eight mines and last year it won the auction for Sukhoi Log, one of the largest undeveloped gold deposits in the world. This year, PJSC Polyus estimates total gold production between 2.35 million ounces to 2.40 million ounces.
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7. Gold Fields Ltd (GFI)
Total Production (ounces): 2,232,500
Gold Fields Limited (ADR) (NYSE:GFI) is another one of the biggest gold mining companies in the world that is based in South Africa. The company operates mines in South Africa (South Deep Gold Mine), Ghana (Tarkwa Gold Mine, Damang Gold Mine), Australia (Agnew Gold Mine, St Ives Gold Mine, Granny Smith Gold Mine) and Peru (Cerro Corona Gold Mine). In addition to gold, Gold Fields Limited (ADR) (NYSE:GFI) generates revenue from the production of copper. Gold Fields Limited (ADR) (NYSE:GFI) saw 11 investors from our database holding shares at the end of 2017.
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6. Newcrest Mining Ltd
Total Production (ounces): 2,380,630
Newcrest Mining Ltd is based in Australia, where it has production in Cadia Valley, NSW and Telfer, WA (gold and copper). In addition, the company has operations in Indonesia, holding 75% of PT Nusa Halmahera Minerals, which operates the Gosowong mine that extracts gold and silver, and Côte d’Ivoire, holding 90% of LGL Mines CI SA, which operates the Bonikro site. In 2010, Newcrest Mining Ltd acquired Lihir Gold Limited, which gave it access to the Lihir mine in Papua New Guinea.
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5. Goldcorp Inc. (GG)
Total Production (ounces): 2,600,000
On the fifth spot in our list of the biggest gold mining companies in the world is Goldcorp Inc. (USA) (NYSE:GG). Goldcorp Inc. (USA) (NYSE:GG) operates four mines in Ontario, Canada, as well as one mine in Mexico and Dominican Republic and two mines in Argentina. In addition, the company has two mines under development in Canada and 50% ownership in two projects under development in Chile. Aside from gold, Goldcorp Inc. (USA) (NYSE:GG) produces Silver, Copper, Lead, Zinc, and Molybdenum. At the end of 2017, there were 26 funds tracked by Insider Monkey bullish on Goldcorp Inc. (USA) (NYSE:GG).
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4. Kinross Gold Corporation (KGC)
Total Production (ounces): 2,673,533
Kinross Gold Corporation (USA) (NYSE:KGC) operates gold and silver mines in Brazil (Paracatu), Russia (Kupol-Dvoinoye), and Mauritania (Tasiast). In addition, Kinross Gold Corporation (USA) (NYSE:KGC) holds 100% interest in Fort Knox mine in Alaska, in Buckhorn mine in Washington, Round Moutain mine and Bald Mountain mines in Nevada, La Coipa mine, Maricunga mine, and Lobo-Marte property in Chile and other mining properties. Kinross Gold Corporation (USA) (NYSE:KGC) saw 20 funds long its stock heading into 2018.
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3. AngloGold Ashanti Ltd (AU)
Total Production (ounces): 3,755,000
AngloGold Ashanti Limited (ADR) (NYSE:AU) is headquartered in Johannesburg, South Africa and operates eight mines in the country, in addition to mines in Brazil, the United States, Argentina, Ghana, Namibia, Mali, Tanzania, and Zimbabwe. In 2017, the company’s production increased from 3.63 million ounces in 2016, but was lower than 3.83 million ounces in 2015. There were 17 funds in our database that disclosed holding shares of AngloGold Ashanti Limited (ADR) (NYSE:AU) as of the end of 2017.
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2. Newmont Mining Corp. (NEM)
Total Production (ounces): 5,266,000
Newmont Mining Corp (NYSE:NEM) is on the second spot among biggest gold mining companies in the world and is the only US-based company in the list. It has operations in five countries: the US, Ghana, Australia, Suriname, and Peru. Last year, Newmont Mining Corp (NYSE:NEM) increased its gold production by 8% and expects further growth in the near future. The company’s estimate for 2018 and 2019 stands between 4.90 million ounces and 5.40 million ounces, while through 2022, the company expects gold production between 4.60 and 5.10 million ounces. At the end of the last year, there were 33 funds bullish on Newmont Mining Corp (NYSE:NEM), which makes it the most popular gold mining company in this list.
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1. Barrick Gold Corp. (ABX)
Total Production (ounces): 5,323,000
Canada-based Barrick Gold Corp (USA) (NYSE:ABX) is the largest gold mining company in the world and it has operations in Argentina, Australia, Canada, Chile, the Dominican Republic, Papua New Guinea, Peru, Saudi Arabia, the US, and Zambia. The company produces the majority of its gold in the Americas, where it focuses on high-margin and long-life operations. Over the last couple of years, Barrick Gold Corp (USA) (NYSE:ABX)’s gold production has been declining from 6.20 million ounces in 2014, to 6.10 million ounces in 2015, and 5.50 million ounces last year. Barrick Gold Corp (USA) (NYSE:ABX) is the second most-popular gold producer among the hedge funds in our database, with 32 investors holding shares as of the end of 2017.
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As you can see, the majority of the biggest gold mining companies in the world are headquartered in Canada, followed by South Africa. However, all companies are diversified geographically and have operations in different countries. One thing that has to be taken into account when looking at potential gold mining companies to invest in (in addition to their financial performance), is the political, economic, and social situation in countries where gold miners have operations, since lack of stability can potentially disrupt their operations.
Disclosure: none
