CIBC, however, has carved out its top picks in the sector, based on the quality of assets and the prospect of strong free cash flow. Among large producers, they like Barrick Gold Corp., Agnico Eagle Mines Ltd., Kirkland Lake Gold Inc. and B2Gold Corp.
Among intermediate producers, they like Pan American Silver Corp., Endeavour Mining Corp. and Alamos Gold Inc. Among small-cap stocks, they prefer Teranga Gold Corp. and Osisko Mining Inc. And among gold royalty companies, they pick Franco-Nevada Corp. and Wheaton Precious Metals Corp.
“While all of these equities posted significant share price gains, on average 50 per cent year-to-date, we believe there is still substantial room to move higher on the back of company-specific catalysts, improving free cash flow yields and an increased focus on return of capital to shareholders, which in turn will attract renewed interest to the space,” the CIBC analysts said.