ABX Vs. NEM: Which Gold Mining Stock Is Best Right Now?

After a sluggish 2015, gold has regained a lot of momentum this year due to several key factors that have caused uncertainty in the global markets. The yellow metal has surged roughly 25% in 2016, and as a result, gold mining stocks are also surging.

Recently, gold has been the biggest beneficiary of the Federal Reserve’s decision to keep interest rates steady throughout June, as well as the United Kingdom’s decision to withdraw from the European Union. As the price of gold hit a two-year high last week, gold miners also made big gains and investors are starting to look at these stocks as solid options in today’s market.

With that said, smart investors should take their time and do their due diligence before investing in the gold mining industry. Not every miner is the same and it’s important to look at all the key metrics to determine which stock is your best bet right now.

(Also Read: 5 Things Every Investor Needs To Know About Gold Mining)

It’s also important to remember that gold miners come in all shapes and sizes. While mid-cap companies like B2Gold (NYSE:BTG) , Royal Gold (NASDAQ:RGLD) , and Yamana Gold (NYSE:AUY) each hold a Zacks Rank #1 (Strong Buy), the bigger giants of the industry continue to see high trading volumes and interest from investors.

Out of these giants, Barrick Gold (NYSE:ABX) and Newmont Mining (NYSE:NEM) , two of the largest gold mining companies in the world, continue to be among the most recognizable names in the sector. With all eyes on gold right now, it’s time to put these two stocks head-to-head.

The Matchup

It’s a pretty close contest between these two massive gold mining companies. Take a look at this chart for a quick glimpse at some of the most important metrics:

As you can see, both of these stocks have had a solid amount of momentum this year, but their futures remain a bit uncertain. Both companies hold a Zacks Rank #3 (Hold), meaning that their earnings outlook isn’t entirely favorable.

With that said, Barrick Gold seems to have the edge, especially with its earnings data. Barrick has seen positive earnings estimate revision activity lately, while Newmont has seen one negative revision. Also, with a positive Earnings ESP of 14.29%, Barrick appears to be in the better position to post an earnings beat in its next report, whereas Newmont’s negative Earnings ESP makes a positive surprise less likely.

Barrick has also proven to be a bit more consistent over the past year, beating our earnings expectations in each of the trailing four quarters by an average of 26.91%. For Newmont, that figure is just 3.88% and includes one earnings miss of 71.43%.

Bottom Line

Barrick edges out Newmont because it has proven to be slightly more consistent and its estimate revision activity implies that analysts feel at least a little more bullish on the company right now. Either way, both stocks have a Zacks Rank #3 (Hold) and fall behind several better ranked stocks in a loaded industry right now.

On top of the stocks mentioned earlier, Sandstorm Gold (NYSE:SAND) , Franco-Nevada Corp. (TO:FNV) , Golden Start (NYSE:GSS) , and New Gold (TO:NGD) also rank better than both Barrick and Newmont.

Finally, it is important to remember that on a day-to-day basis, gold mining stocks will trade with a heavy dependence on the price of gold. The markets seem to have recovered from the Brexit already, but if the Fed remains dovish throughout the year, gold could continue to climb.