These Stocks are Expected to Rise by at Least 20% with Soaring Gold Prices

As inflation rises for longer and recession risks rise, investors are flocking to gold, a so-called safe haven. Tumult in the banking sector further strengthens gold's appeal.

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At one point on Thursday, gold prices were around $2,020 an ounce, up about 10% from this time last year. In August 2020, during the early days of the Covid-19 crisis, the price peaked at $2,075 -- within striking distance of its previous peak. The price of gold is expected to rise further in the future, according to some industry insiders.

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Depending on which recessionary scenario occurs - if any - hedge fund manager David Neuhauser predicts the price may even hit $3,000.

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According to Neuhauser, the chief investment officer at Livermore Partners, "Do we anticipate a protracted recession or a shallow move?"?

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He said it would be “Determining” whether gold sees $2,200 or $2,300 in the next several months, or whether there is a greater, more pronounced effect on gold, where it may even go as high as $3,000 an ounce in the next year or two,” as he spoke to Trade Algo

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According to FactSet, CNBC Pro looked for stocks in the Global X Gold Explorers ETF, the iShares MSCI Global Gold Miners ETF, the VanEck Gold Miners ETF, and the SPDR S&P Metals and Mining ETFs that could benefit from higher gold prices.

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A majority of analysts cover the following stocks, and they have an average upside of 20%:

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• Novagold Resources Inc

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• Karora Resources, Inc.

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• Hochschild Mining

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• Aya Gold & Silver Inc.

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• Silver Lake Resources Limited

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• PT Merdeka Copper Gold

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• SSR Mining Inc

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• B2Gold Corp.

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• Endeavour Mining

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There is a 40.4% potential upside for NovaGold Resources, and 66% of analysts rate it as a buy.

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Analysts believe Karora Resources' stock will have a 37.1% upside over the next twelve months. By 2024, the company aims to produce 185,000 to 205,000 ounces of gold from its gold mining operations in Western Australia.

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According to FactSet data, analysts expect Hochschild Mining's stock price to rise 32.8% in 2019. According to the company's production target for 2022, 360,000 to 375,000 ounces of gold will be produced from three mines.

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As well as Silver Lake Resources, Endeavour Mining and B2Gold, PT Merdeka Copper Gold, and PT Merdeka Copper Gold made the screen.

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Based on market tailwinds such as lower yields, a weaker U.S. dollar, and geopolitical tensions, Neuhauser of Livermore believes gold is now "the best" asset class to own.    

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“We feel that the metal will have tremendous leverage over the next several years and therefore have a hedge fund exposure of well over 20% through specific small-cap miners," he said.

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Physical gold is also owned by the fund.

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