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After two decades working in housing policy, Priscilla Almodovar is intimately familiar with the challenges the U.S. faces when it comes to housing.

The Brooklyn native took the reins of the New York State Housing Finance Agency in 2007 amid a financial crisis that was fueled by a crash in subprime mortgages. Today, buyers are facing the opposite problem: Demand for homes is so insatiable that even as mortgage rates remain elevated and home-insurance costs soar, home prices keep inching up to new record highs.

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As the chief executive of Fannie Mae FNMA, a government-sponsored enterprise that backs one in four residential mortgages in the U.S., Almodovar, 57, has a front-row seat to it all. That lands her on the MarketWatch 50 list of the most influential people in markets.

“It’s a highly unaffordable market right now. We are monitoring and following all these trends, things that we’ve never seen before,” Almodovar told MarketWatch in an interview.

“You have home prices the highest we’ve seen in two decades,” she said.

Home sales on track for worst year since 1995

Home buyers and renters are facing record-high housing costs. The issue has become such a big priority for average Americans that the presidential candidates are proposing various solutions to make homeownership more affordable.

Meanwhile, some renters are taking matters into their own hands with rent strikes, while some aspiring homeowners have abandoned the idea and decided to rent indefinitely, finding it far cheaper than owning.

Even though mortgage rates have come down after the 30-year rate posted a big jump to 8% in October 2023, the average mortgage payment — which includes principal and interest, as well as property taxes and homeowners insurance — hit a new record high of $2,070 in August, according to Intercontinental Exchange. That’s up 24% from before the pandemic.

Mortgage rates are unlikely to drop back down to prepandemic levels anytime soon, Almodovar said. Regarding the 3% rate seen during the pandemic, she said, “we probably will never see that again in our lifetime.”

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Even if buyers can afford the price of a home, there aren’t many options to choose from. The market is still enduring the lock-in effect, with current homeowners seeing little benefit in selling their current property and buying a more expensive one at higher interest rates.

The lock-in effect in particular is an unusual phenomenon that has stalled the housing market. Homeowners’ unwillingness to sell resulted in home sales that were 57% lower in the fourth quarter of 2023 than in the same quarter the previous year, the Federal Housing Finance Agency estimated in March.

Put another way, the lock-in effect “prevented” the sale of 1.33 million homes, the agency said.

Addressing the nation’s housing challenges will likely take more than initiatives from whoever wins the presidential election. Bringing the cost of housing down will also require policy makers at the federal, state and local levels to get involved, Almodovar said.

“There’s a consensus today that part of the solution is more supply,” she said. That means preserving the nation’s old existing homes and also building new units, she added.

Many of the obstacles to increasing housing supply are controlled at the local level, she noted.

“It’s zoning. It’s not-in-my-backyard NIMBY-ism,” Almodovar said. “The No. 1 issue is the local. That’s where decisions really get made.”

Homeownership is still part of the American dream

The pressure brought on by high rates and high prices has stalled the housing market. Fannie Mae’s economists expect only 4 million existing homes to be sold in the U.S. through 2024, the lowest number since 1995.

Nonetheless, most Americans aspire to own a home. About 84% of respondents in a 2023 survey by LendingTree said that homeownership is part of their American dream.

Almodovar grew up in New York City, and her parents bought their first home when she was 5 years old. In reaching that milestone, they felt like they had achieved the American dream, she recalled, noting that the idea is still “very much ingrained in what we think, and the mindset of our country.”

For that reason, the current environment has made housing “one of the most important domestic policy issues that we have to tackle,” Almodovar said.

Housing costs pushed up by unstable variables

It’s not just the challenges of saving for a down payment and of navigating elevated mortgage rates that are making homeownership unaffordable for many Americans. Rising insurance costs also mean homeowners are struggling more to fit their monthly payments into their budget.

Unlike a monthly mortgage payment, which remains the same throughout the life of a fixed-rate loan, insurance costs have surged over the last few years, adding instability to an otherwise stable 30-year loan.

Recent natural disasters — including hurricanes Milton and Helene, which caused significant damage in parts of the southeastern U.S. — illustrate the challenges climate change is posing to homeowners and to the housing industry.

Climate risk is something Fannie Mae is monitoring closely, Almodovar said.

As real-estate companies race to bring climate-risk information to prospective home buyers and homeowners, government agencies are revving up not only to offer assistance to affected homeowners but also to impose a moratorium on foreclosures of mortgages insured by the Federal Housing Administration.

They are also trying to stay ahead of the risk by encouraging people to make their homes more resilient to climate disasters.

Because it guarantees one in four mortgages in the U.S., Fannie Mae has skin in the game — and officials there are  worried.

There is a gap between how much risk is understood by homeowners and what private-sector companies know, Almodovar said.

The federal government publishes maps of places that are expected to flood, but Hurricane Helene demonstrated how locales that are further inland and have historically not been prone to flooding can end up inundated. “So it is something that concerns us,” Almodovar said.

Ultimately, “climate is one of those areas where there’s no one silver bullet,” she said. Instead, “it’s really all sectors working together, and all industries working together.”

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Donnie’s “pickle” is more like a jar of problems – financial chaos, a struggling marriage and some serious tax issues.

The 53-year-old truck driver, who called into The Ramsey Show, painted a picture of financial highs and lows. At one point, things were great: debt-free, savings stacked up and no need for credit cards. But then, things took a sharp turn when his wife, who had been managing the money, started racking up credit card debt, drained their savings and let the IRS bills pile up, resulting in a whopping $30,000 tax bill. To top it off, Donnie wants a divorce and has nothing saved for retirement. His total debt is $50,000.

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“I’m in a pickle,” Donnie says, to which Dave Ramsey’s co-host John Delony adds, “Sounds like you’re in a jar of pickles.” The three men chuckle, but the situation is far from amusing.

According to the hosts, the core of the issue isn’t just the taxes or the debt. It’s the fact that Donnie and his wife have been dancing around their problems, communicating poorly and working at cross purposes. Sure, they got debt-free at one point, but as Ramsey pointed out, “You didn’t achieve y’all’s goal, you achieved your goal.” Ouch. The cracks in their financial plan reflect deeper issues in their relationship. While they once found common ground on their finances, their marriage was clearly unraveling in the background.

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“You guys suck at communication in your marriage beyond belief.” He explains that unless they find alignment – agreeing on both their financial and marital goals – the money issues will continue to pile up, whether or not they stay married. And as harsh as it sounds, if they can’t get on the same page, the only thing left to do will be to fix the money mess after the inevitable divorce.

In terms of the IRS debt, Ramsey tells Donnie to sit down with one of his Ramsey Solutions tax pros and negotiate a payment plan to pay off the debt. But that only solves the debt issue.

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Donnie’s struggle is relatable for many. While things may seem financially smooth at one point, underlying problems – whether in communication, trust or joint goals – can bring everything down.

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The bottom line here is that no amount of financial planning can fix a falling-apart marriage if both partners aren’t truly aligned. It’s a pickle that requires more than just crunching numbers; it needs real communication, a shared vision and a hefty dose of honesty.

Whether navigating life solo or teaming up as a couple, consulting a financial advisor can make a difference in situations like Donnie’s. Getting an expert to help untangle financial messes can save you from future headaches. Don’t let your “pickle” become a whole jar – talk to a financial advisor and get on the path to stability, one step at a time.

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This article ‘I’m In A Pickle’ – 53-Year-Old Broke Truck Driver With No Retirement Savings, Owes The IRS And Wants A Divorce Asks Ramsey For Advice originally appeared on Benzinga.com

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Market News and Data brought to you by Benzinga APIs

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

By Michelle Conlin and Matt Tracy

NEW YORK/WASHINGTON (Reuters) – For 32 years, Jim Tynan had a homeowners’ policy with Allstate on his 1,200-square foot condo in Ponte Vedra, Florida.

In January, Tynan’s Allstate subsidiary told him it was going to drop him. Tynan called ten different agencies, “and none would cover me,” he said.

Finally, he found one that would. It cost 50% more.

Florida has been hit with four major hurricanes in the past four years, which has sent insurance premiums rocketing and caused some insurers to pull back on coverage. For residents cleaning up after storms or living nearby water, they have another worry: Will they still have insurance?

Tynan said he has not been hit directly by a hurricane but is two miles from the ocean.

“I live in fear I will get a letter from my new company telling me they are going to drop me, too,” said Tynan, speaking after the latest hurricane. “It’s very scary.”

Six other homeowners contacted by Reuters in areas including both Florida coasts and the Keys also said they were worried that the back-to-back hurricanes would result in more price hikes and exclusions. Worse, they feared they could lose their insurance altogether.

Allstate said it worked with regulators to protect as many customers as possible. For those that it cannot cover, “We work with other carriers to offer alternative coverage offerings.”

A number of homeowners in Florida have faced a precarious situation for securing insurance. Average homeowner premiums in Florida surged nearly 60% between 2019 and 2023. Some major insurance providers have reduced coverage. The state insurer, Citizens, meanwhile has taken on increased business.

Analysts and insurance experts predict more nervousness about insurers following Hurricane Milton, which made landfall on Florida’s Southwest coast just 12 days after Hurricane Helene made landfall on Florida’s Northwest coast.

“This is …certainly going to cause insurers to be concerned about continuing to insure in the market,” said Marc Ragin, associate professor of risk management and insurance in the Terry College of Business at the University of Georgia.

The increased hurricanes could increase reliance on the state-backed nonprofit insurer Citizens, considered the insurer of last resort.

Florida’s Governor Ron DeSantis has in the past raised questions about how the insurer could pay claims if large storms hit. Citizens spokesperson Michael Peltier said it would always be able to pay as it was structured to first levy surcharges on policyholders and then, if needed, assessments on non-policyholders. He said about 80,000 claims came in so far related to Milton and it expected to be able to pay them all without having to levy assessments on non-Citizens policyholders.

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DeSantis’ office said on Wednesday that while Citizens will always have the ability to pay claims “this comes at the expense of all Florida insurance policy holders.”

Citizens had over 1.2 million policies in force as of June, according to data from the Florida Office of Insurance Regulation (FLOIR), up from roughly 1.14 million policies at the end of 2022.

“We could see a scenario where Citizens again has to take on a lot of policies,” said Chai Gohil, global insurance analyst at investment management firm Neuberger Berman.

INSURANCE WORRIES

The storms, in close succession, intensified concerns about higher prices.

“The hope of a softer market I think just disappeared after Helene and Milton,” Orion180 founder and CEO Ken Gregg told Reuters in a written statement. Gregg added that Milton would have an impact on the reinsurance market for the next season “in capacity and pricing.”

Brian Schneider, Fitch Ratings’ senior director of insurance, said price hikes by reinsurers pushes “a lot of the primary insurance companies, particularly on the commercial side, to have to increase their pricing that they charge on the property business.”

Florida’s insurance market is made up of a mix of major established players, newer entrants and Citizens.

In addition, a number of insurers, including Orion180 Insurance, are taking on existing policies from Citizens in a “Depopulation Program” to shift policyholders to private insurers. Citizens spokesperson Michael Peltier said it aims to reduce its policies in force to below one million by the end of 2024.

Despite the massive storms, a number of private insurers said they remained committed to the market.

The largest include State Farm Florida Insurance and Universal Property & Casualty Insurance, according to the Florida Office of Insurance Regulation (FLOIR).

“State Farm plans to continue our presence in the Florida insurance marketplace,” a company spokesperson told Reuters.

Universal Property & Casualty Insurance chief strategy officer Arash Soleimani said the company is “firmly committed” to Florida. “Nothing that’s happened this year has been outside our modeled expectations.”

Security First Insurance, a Florida-focused insurer, also said it remained committed to the market.

“Another hurricane like Milton for Security First would be an earnings event, not a capital event,” CEO Locke Burt told Reuters.

Of those that pulled back, many retain some exposure.

Progressive began reducing exposure in mid-2022 to focus on states with less catastrophe exposure, although a Progressive spokesperson said it continues to write property business in the state.

In 2023, Farmers Insurance exited its own-branded coverage in the state. A Farmers spokesperson said it continues to serve customers through its Bristol West and Foremost brands.

Travelers has avoided underwriting in Florida due to the weather-related risk there, Travelers president of personal insurance Michael Klein said on an April earnings call. The company did not respond to a request for comment.

“I think that while Milton and Helene are back-to-back gut punches for the state of Florida, large insurers are in a great position to pay claims,” said Michael Carlson, president and CEO of the Personal Insurance Federation of Florida which represents large insurers in the state and doesn’t see large players leaving.

For homeowners, however, the worries mount.

“The reality is we may be forced out of our home where we have lived for 35 years,” said Sherri Hansen, who lives in the Florida Keys. “All our eggs are in this one basket.”

(Reporting by Matt Tracy in Washington and Michelle Conlin in New York; editing by Megan Davies and David Gregorio)

Lucid Motors stock (LCID) is sliding after the electric vehicle maker announced another capital raise via a share sale late Wednesday night, as the California-based automaker seeks further runway ahead of the release of its upcoming electric SUV.

Lucid said it will offer up to 262,446,931 shares, with the proceeds likely raising around $1.67 billion, for general corporate purposes as well as for capital expenditures and working capital.

The company also said its majority shareholder, Public Investment Fund affiliate Ayar Third Investment Company, would purchase an additional 374,717,927 shares via a private placement, which would allow Ayar to maintain its 58.8% stake without dilution.

As a result of these moves, Lucid stock slid 16% in midday trade.

The stock offerings come only two months after Ayar gave Lucid a cash infusion of around $1.5 billion.

In addition, Lucid filed preliminary third quarter financial results, with a loss from operations expected in the range of $765 million to $790 million for the quarter, similar to the $790 million lost in Q2. Third quarter revenue is expected in a range of $199 million to $200 million, ahead of estimates of $196.4 million, as compiled by Bloomberg,

Lucid also said it had approximately $1.9 billion in cash and equivalents, with total liquidity of $4 billion prior to the capital raise.

Last week, Lucid said it delivered 2,781 vehicles during the quarter, beating Bloomberg estimates, but its 1,805 cars produced missed what the Street was expecting.

Lucid hopes its upcoming Gravity SUV, expected to begin production later this year, will jump-start sales by a significant margin.

“We believe that the total addressable market for Gravity is six times that of Lucid Air,” Lucid CEO Peter Rawlinson said in an interview with Yahoo Finance in August.

Rawlinson said the company will eventually have capacity at its Arizona plant to build 90,000 Gravity SUVs per year.

The big question will be whether Lucid can build the Gravity SUV efficiently and come in below cost. The Gravity is expected to start around $80,000 in the US, right at the eligibility threshold for the federal EV tax credit.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.

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VANCOUVER, British Columbia and BONHAM, Texas, Oct. 17, 2024 (GLOBE NEWSWIRE) — Kelso Technologies Inc. (“Kelso” or the “Company”), KLS, reports that it has released its unaudited consolidated interim financial statements and Management Discussion and Analysis for the three months ended September 30 2024.

The unaudited consolidated interim financial statements were prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). All amounts herein are expressed in United States dollars (the Company’s functional currency) unless otherwise indicated.

The Company’s unaudited consolidated financial statements and MD&A for the three months ended September 30, 2024 were approved by the Board of Directors on October 16, 2024.

HIGHLIGHTS:

• In Q3-2024, revenue decreased by 20% to $2.52 million compared to $3.14 million in Q3-2023, resulting in a net loss of $361,800. However, this net loss represents an improvement from Q2-2024, where the net loss was $544,927, primarily due to new management’s focus on expense reduction strategies.
• Kelso continues to maintain above industry average gross profit margin of 44% due to the maintenance of production effectiveness and efficiencies stemming from per order-based pricing models.
• The third quarter of 2024 was a challenging period for the Company, due to ongoing market weakness in tank car demand. The Company’s focus remains towards sustainable revenue growth.
• Kelso remains focused on management of its operations to align with reductions in revenue. Quarter-over-quarter improvement in expenses relative to revenue showed three months ending September 30, 2024 relative expenses to revenue was 58% versus the prior quarter of 65%. Management remains committed to cost controls to effectively work within its means for efficient operations.
• Frank Busch was appointed interim Chief Executive Officer. As well as the appointments of Sameer Uplenchwar as the Chief Financial Officer, and Maureen O’Hanley Doucette as Corporate Secretary.
• Management is continuing to focus its attention on increasing shareholder value by reducing expenses associated with the KXI HD system (KXI) and will continue with the previously announced KXI strategic review to maximize shareholder value.
• Subsequent event to the quarter-end, Kelso’s US subsidiary secured a line of credit amounting to $500,000 from Texas Capital Bank.

* 2023 Includes termination settlement of $465,360 which was a cash expense. If excluded then Adjusted EBITDA would be $(674,771)

LIQUIDITY AND CAPITAL RESOURCES

As at September 30, 2024 the Company had cash on deposit in the amount of $410,416, accounts receivable of $1,124,535 prepaid expenses of $66,887 and inventory of $3,953,178 compared to cash on deposit in the amount of $1,433,838, accounts receivable of $1,065,411 prepaid expenses of $134,349 and inventory of $3,376,005 at December 31, 2023.

The Company had income tax payable of $68,024 at September 30, 2024 compared to $10,024 at December 31, 2023.

The working capital position of the Company as at September 30, 2024 was $3,153,530 compared to $5,026,580 as at December 31, 2023. Capital resources and operations are to be expected to continue the Company’s ability to conduct ongoing business as planned for the foreseeable future.

Total assets of the Company were $9,620,226 as at September 30, 2024 compared to $9,703,271 as at December 31, 2023. Net assets of the Company were $7,114,767 as at September 30, 2024 compared to $8,720,248 as at December 31, 2023. The Company had no interest-bearing long-term liabilities or debt as at September 30, 2024 or December 31, 2023.

The Company’s revenue was down 20% to $2,523,477 in Q3-2024 compared to $3,138,137 in Q3-2023. The third quarter of 2024 was a challenging period for the Company, marked by challenging market conditions related to tank car demand.

Management takes all necessary precautions to minimize risks, however additional risks could affect the future performance of the Company. Business risks are detailed in the Risks and Uncertainties section of this MD&A.

OUTLOOK

During the third quarter of 2024, Kelso continued to strengthen the portfolio of its rail products by closely monitoring those products near completion of the required AAR service trial period. The strategic focus is to obtain full AAR approvals in 2024 to complete our entire portfolio of rail pressure car products. This has been the Company’s core branding ambition over the past fourteen years and it is expected in 2025.

The Company is undertaking a strategic reorganization with a focus on improving its financial outlook without impacting production capability. The Company has now reduced its workforce and R&D costs associated with the KXI entity and will continue its strategic review for KXI into 2025 to hopefully unlock additional value for shareholders. There is a shift toward rail pressure cars and the Company is completing the last stages of an AAR regulatory approved rail pressure car kit in 2024 to drive new sources of sales growth. The Company has fully developed production systems including supply chain, inventory levels, reliable costs, selling prices and predictable profitability that Management expects to remain stable in 2024.

The level of activity for tank car orders and deliveries puts the segment on track for the lower end of replacement demand for 2024 and 2025. The current forecast has 2024 tank car deliveries is approximately 8,400 units (FTR, 2024 Q3 Rail Equipment Outlook “FTR”), The published FTR rail car delivery forecast for 2025 is expected to remain approximately 8,000 units. The outlook in 2026 looks positive with FTR forecast of 9,350 units (+17% y/y) growing to 13,000 units (+39% y/y) in 2027. Despite current macroeconomic challenges the Company is in a good position to service all product orders from the rail tank car industry for the foreseeable future.

The Company is addressing previous challenges and restructuring to enhance profitability while pursuing strategic growth opportunities that leverage its competitive advantages in the rail industry. Our goal is to become the primary, high quality products featuring our 100% “Made in USA” product line fully servicing the rail tank car market.

Key to the development of the Company’s rail revenue growth ambitions in 2025 is the full AAR approval of our pressure car package. This package sells at a much higher tank car unit value. Our specialized angle valves for the pressure car package have completed their service trial and are in the final stages of the full AAR approval process. The AAR approvals are the key milestone to establish new revenue growth from rail related products.

SUMMARY

The Company believes it is positioned for new value creation and anticipates further success in established rail markets. With no interest-bearing long-term debt and improved sales prospects from larger, diverse markets, Kelso can concentrate on enhancing its equity value through financial performance driven by a broader range of new proprietary products.

About Kelso Technologies

Kelso is a diverse transportation equipment company that specializes in the creation, production, sales and distribution of proprietary products used in rail and automotive transportation. The Company’s rail equipment business has been developed as a designer and reliable domestic supplier of unique high- quality rail tank car valves that provide for the safe handling and containment of commodities during rail transport. The automotive division of the Company has created the first proven automated suspension-based Advanced Driver Assistance System for commercial mission-critical wilderness operations. All Kelso products are specifically designed to address the challenging issues of public safety, worker well-being and potential environmental harm while providing effective and efficient operational advantages to customers. Kelso’s innovation objectives are to create products that diminish the potentially dangerous effects of human and technology error through the use of the Company’s portfolio of proprietary products.

For a more complete business and financial profile of the Company, please view the Company’s website at www.kelsotech.com and public documents posted under the Company’s profile on SEDAR in Canada and on EDGAR in the United States.

On behalf of the Board of Directors,

Frank Busch, Interim CEO

Legal Notice Regarding Forward-Looking Statements: This news release contains “forward-looking statements” within the meaning of applicable securities legislation. Forward-looking statements indicate expectations or intentions. Forward-looking statements in this news release include that our new rail products will sell once AAR approvals are secured; that our specialized angle valves for the pressure car market have completed their service trial and are in the final stages of the full AAR approval process; that although the rail industry is fully depressed there is still opportunity for Kelso to grow its revenues by being able to fully service the repair, retrofit and requalification activities by hazmat shippers with a broader range of “100% Made in the USA” components; that the Company is reducing KXI costs as part of a strategic review; and that current working capital and anticipated sales activity at above average contribution margins for 2024 are expected to protect the Company’s ability to conduct ongoing business operations for the foreseeable future. Although Kelso believes the Company’s anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, they can give no assurance that such expectations will prove to be correct. The reader should not place undue reliance on forward-looking statements and information as such statements and information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Kelso to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information, including without limitation that the risk that the longer-term effects on the rail industry including high interest rates, inflation and short supply chain issues may last much longer than expected delaying business orders from customers; that the development of new products may proceed slower than expected, cost more or may not result in a saleable product; that tank car producers may produce or retrofit fewer than cars than expected and even if they meet expectations, they may not purchase the Company’s products for their tank cars; capital resources may not be adequate enough to fund future operations as intended; that the Company’s products may not provide the intended economic or operational advantages to end users; that the Company’s new rail products may not receive regulatory certification; that customer orders may not develop or be cancelled; that competitors may enter the market with new product offerings which could capture some of the Company’s market share; that a new product idea under research and development may be dropped if ongoing product testing and market research reveal engineering and economic issues that render a new product concept infeasible; and that the Company’s new equipment offerings may not capture market share as well as expected. Except as required by law, the Company does not intend to update the forward-looking information and forward-looking statements contained in this news release.

For further information, please contact:

From 50-pound bags of rice to pet insurance to solar panel installation, the range of items and services that Costco (NASDAQ: COST) provides its customers is remarkable. One of the most popular items recently, though, is gold bullion. Of the 101 stores that Bloomberg surveyed earlier this month, 77% reported that they had sold out of bars of the yellow metal.

But buying bullion only will translate to growth in your investment if the price of gold rises — something that is far from a sure thing. Investors looking to gain gold exposure, on the other hand, would be better off loading up on a dividend-paying gold stock. Fortunately for them, Agnico Eagle Mines (NYSE: AEM), Centerra Gold (NYSE: CGAU), and Franco-Nevada (NYSE: FNV) are three top dividend-paying gold stocks that look especially lustrous right now.

Agnico Eagle offers a conservative approach to the yellow stuff

With a history spanning more than 60 years, Agnico Eagle has emerged as one of the leading gold producers available to investors. It operates a sizable portfolio of 11 assets located in four countries, and forecasts gold production of approximately 3.45 million ounces in 2024. It has made solid progress toward achieving this guidance, reporting gold production of 1.8 million ounces through the first half of the year. The future seems bright as well, with about 54 million gold ounces of proven and probable reserves.

Agnico Eagle has paid a dividend for 41 consecutive years, demonstrating a strong commitment to rewarding shareholders. Should it pay a dividend of $1.60 per share in 2024 as management expects, the company will have hiked its dividend at a compound annual growth rate (CAGR) of more than 23% since it paid $0.03 per share in 2005. Investors who pick up Agnico Eagle stock and its 2% forward-yielding dividend can rest easy knowing that the company isn’t imperiling its financial health to reward shareholders. Agnico Eagle has an investment grade balance sheet, and its payout ratio has averaged 64% over the past five years.

Your passive income stream can gleam with Centerra Gold

With a market capitalization of $1.5 billion, Centerra Gold may not be one of the largest gold stocks on the market. But what it lacks in size regarding market cap, it makes up for with its payout — one of the most alluring dividends among its gold stock peers, with a forward yield of 2.9%. Adding to the stock’s appeal right now is the fact that it’s currently sitting in the bargain bin. Currently, shares of Centerra are valued at 4.3 times operating cash flow, a discount to their five-year average cash flow multiple of 5.6.

Like Agnico Eagle, Centerra is operating from a position of considerable financial strength. Whereas many gold producers rely heavily on leverage in order to develop their metal-producing assets, Centerra maintains a solid balance sheet which currently features zero debt and $592 million in cash on hand.

The company has two core projects in its portfolio: Mount Milligan and Oksut. But Centerra has several irons in the fire, positioning it for growth. Most notably, it plans on growing its molybdenum business by ramping up operations at its Langeloth molybdenum conversion facility. Management expects that when Langeloth achieves production capacity (about 40 million pounds annually), it will generate about $50 million in earnings before interest, taxes, depreciation, and amortization (EBITDA) per year.

Franco-Nevada offers a unique approach to gold investment

For a slightly different approach to gaining gold exposure, investors may want to consider Franco-Nevada, a royalty and streaming company. By acting like specialized financiers, royalty and streaming companies provide gold mining companies with upfront capital for developing assets. In return, the royalty and streaming companies receive a percentage of the mine’s sales, or the right to purchase the future production of a metal from a mine for a agreed-upon price.

Franco-Nevada has a formidable portfolio with interests in 432 projects. While 118 of these projects are currently in production, 38 projects are in the advance phase of development, and 276 are in the exploration phase, so there is a robust pipeline of growth projects. These projects represent a variety of commodities, from precious metals to oil and gas to platinum group metals. But it’s gold that represents the company’s bread and butter. In the second quarter of 2024, for example, gold accounted for 61% of the company’s revenue. Oil was the second greatest contributor to quarterly revenue, accounting for 14% of sales.

Franco-Nevada’s dividend currently provides a modest forward yield of 1.2%. While it’s not as generous as that of Centerra or Agnico Eagle, it’s better than the non-existent dividend investors who buy bullion receive. Moreover, the company’s commitment to rewarding shareholders is clear. It has raised its payout for 17 consecutive years, suggesting that future dividend raises are likely.

Should you add some glitter to your portfolio with these gold stocks right now?

For those interested in diversifying their portfolios with a gold investment, buying bullion at Costco isn’t the best option, since those gold bars will only prove to be successful investments if the price of gold continues to rise. Instead, investors would be better off buying shares of dividend payers Agnico Eagle and Centerra — though the latter may appeal to those looking for a stock hanging on the discount rack. For the most conservative of investors, Franco-Nevada is a better option, as it’s not exposed to the risks of developing assets like gold-producing companies are.

Should you invest $1,000 in Agnico Eagle Mines right now?

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*Stock Advisor returns as of October 14, 2024

Scott Levine has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Centerra Gold and Costco Wholesale. The Motley Fool has a disclosure policy.

Instead of Buying Gold Bars From Costco, Buy These 3 Lustrous Gold Stocks was originally published by The Motley Fool