Precious metals like gold and silver can offer portfolio diversification and help lower your investment risk profile. These two commodities are used as a store of value and a hedge against inflation, making them ideal for investors looking to move away from volatile asset classes such as equities.
While you can get exposure to gold and silver by investing in exchange-traded funds that track the commodities, you could also buy and hold shares of precious metal companies that mine these metals.
In this article, I have identified two such TSX mining stocks you can buy with $10,000 in 2025 for inflation protection.
Source: Getty Images
Is this TSX mining stock a good buy right now?
Valued at a market cap of $2.24. billion, Discovery Silver (TSX:DSV) has already returned 194% to shareholders in the past year. A mineral exploration company, Discovery Silver explores and develops polymetallic mineral deposits.
Its flagship property is the Cordero silver project, comprising 26 contiguous claims that cover an area of 34,909 hectares located in Mexico. Last year, Discovery Silver announced a transformational acquisition of Newmont’s Porcupine Complex in a deal valued at US$425 million, creating a new Canadian gold producer with significant upside potential.
The transaction includes upfront consideration of US$275 million, consisting of US$200 million in cash and US$75 million in Discovery equity, plus US$150 million in deferred payments starting in 2027.
The Porcupine Complex, which has produced nearly 70 million ounces since operations began in 1910, is expected to produce around 285,000 ounces of gold annually over the first decade. Discover projects a base case NPV (net present value) of US$1.2 billion using analyst consensus gold price forecasts, or US$2.2 billion at a fixed US$2,700/oz gold price.
Discovery has secured a US$575 million financing package that includes a US$400 million royalty and debt financing from Franco-Nevada, as well as a $247.5 million bought deal offering.
Is this gold mining stock undervalued?
Valued at a market cap of $48 billion, Barrick Gold (TSX:ABX) is among the largest mining companies in the world. In the fourth quarter (Q4) of 2024, Barrick Gold delivered its strongest financial results in a decade, with production increases and cost reductions helping the mining giant meet its guidance.
It reported a 30% increase in EBITDA (earnings before interest, tax, depreciation, and amortization) and expanded EBITDA margins both quarter on quarter and year over year.
Gold production from its mines increased 15% quarter on quarter, with a 3% reduction in cost of sales and a 5% decrease in total cash costs.
“We saw EBITDA increase 30% and EBITDA margins grow both quarter on quarter and for the year,” said Mark Bristow, president and chief executive officer. “Adjusted net earnings per share grew 50% year on year to $1.26.”
However, operations at the Loulo-Gounkoto mine in Mali have been suspended due to ongoing negotiations with the government, resulting in a significant goodwill impairment.
Barrick Gold continued its shareholder return strategy with quarterly dividends of US$0.10 per share and the repurchase of US$354 million of stock in Q4, bringing the yearly total to nearly US$500 million.
Analysts remain bullish on the TSX stock and expect it to gain over 20% in the next 12 months.
