2 Cheap Gold Stocks With Dividends to Buy in 2022

The expectations of a rebound in gold prices could drive these two gold stocks higher in 2022.

| More on:

After reaching their all-time high in August 2020, gold prices have seen a sharp downside correction. In 2021, the yellow metal’s prices dived by nearly 5% amid gradually easing concerns about COVID-19. Weakening gold prices also took a toll on the Canadian gold sector, as the shares of most gold miners slipped to underperform the broader market by a wide margin. Before I talk about two cheap gold stocks to buy in 2022, let me explain why investors should consider adding some gold stocks to their portfolios now.

Why invest in gold stocks in 2022?

Investors worldwide consider gold one of the safest assets to park their money. That’s why the demand for precious metals tends to increase in uncertain times. Clearly, investors’ worries about the global pandemic eased to a great extent in 2021. However, some pandemic-driven negative factors like the supply chain disruptions and labour shortages along with inflationary pressures still remain worrisome for businesses.

In 2021, most stock investors seemingly ignored these issues, as stocks continued to reach new heights. However, many experts expect the market to see a healthy correction in the near term. This expected downside correction in stocks could again increase the demand for gold, leading to a rally in its prices. Stronger gold prices usually positively impact precious metal miners’ financial growth and profitability. That’s why it could be the right time for investors to buy some cheap gold stocks now.

Barrick Gold stock

Barrick Gold (TSX:ABX)(NYSE:GOLD) is one of the largest gold mining companies in Canada, with a market cap of about $42 billion. Its stock is currently trading at $23.56 per share with 16.3% year-to-date losses.

While Barrick Gold’s annual adjusted earnings more than doubled to $1.15 per share in 2020, they are expected to remain nearly flat on a year-over-year basis in 2021. Nonetheless, it’s continuing to post strong profit margins with the help of operational efficiencies and lower operating costs. The company’s consistently improving production in Africa, the Middle East, and Latin America regions could also help it post stronger results in 2022. Apart from these positive expectations, this gold stock also has a decent 2% dividend yield at the moment.

B2Gold stock

B2Gold (TSX:BTO)(NYSE:BTG) is a Vancouver-based gold producer with a market cap of about $5.2 billion. Its stock has seen more than 30% value erosion in 2021 after rallying for the previous five years. By comparison, the TSX Composite Index has risen by more than 22% this year.

In the third quarter, B2Gold achieved record quarterly gold production at its Fekola and Otjikoto Mines. Despite higher production, weaker gold prices are affecting the company’s bottom line. An expected near-term rise in the gold prices could help B2Gold post much stronger financial growth and profitability in 2022.

Moreover, the company’s robust cash flows, operational efficiencies, and long track record of yielding outstanding returns for investors make this gold stock worth buying after the recent drop. B2Gold stock’s strong dividend yield of around 4.2% makes it look even more attractive.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

The Motley Fool has no position in any of the stocks mentioned. Fool contributor Jitendra Parashar has no position in any of the stocks mentioned.

More on Metals and Mining Stocks

Concept of multiple streams of income
Stocks for Beginners

Lock Up This 9.2% Dividend Yield From a Top Royalty Stock

Royalty stocks have a strong advantage when it comes to creating passive income for investors. But this one has the…

Read more »

Safety helmets and gloves hang from a rack on a mining site.
Metals and Mining Stocks

Is First Quantum Minerals Stock a Good Buy Right Now?

First Quantum is a TSX stock that trades 61% below all-time highs. However, the mining stock still trades at a…

Read more »

nugget gold
Metals and Mining Stocks

The Best Gold Stock to Invest $1,000 in Right Now

Here are two of the best Canadian gold stocks that can yield some eye-popping returns in the long run.

Read more »

nugget gold
Stocks for Beginners

The Ultimate Mining Stock to Buy With $1,000 Right Now

This mining stock just saw a drop, but don't let that keep you from diving in. This miner is due…

Read more »

A plant grows from coins.
Metals and Mining Stocks

Canadian Mining Stocks: Buy, Sell, or Hold?

Explore 2025’s top Canadian mining stocks – gold, uranium, and base metals offer big potential in a dynamic, commodity-driven market.

Read more »

farmer holds box of leafy greens
Metals and Mining Stocks

3 Reasons to Buy Nutrien Stock Like There’s No Tomorrow

Nutrien stock has lost 34% of its value just this year alone and looks incredibly cheap today. Yet, secular trends…

Read more »

Canada national flag waving in wind on clear day
Tech Stocks

Trump Trade: Canadian Stocks to Watch

With Trump returning to the presidency, there are some sectors that could boom in Canada, and others to watch. But…

Read more »

Super sized rock trucks take a load of platinum rich rock into the crusher.
Metals and Mining Stocks

Invest $7,000 in This Dividend Stock for $672 in Passive Income

High yield can be an essential requirement when you need to start even a modestly sized passive income with a…

Read more »