Key Points
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Equinox Gold is divesting its Brazilian operations to concentrate on politically stable Tier 1 jurisdictions.
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Agnico Eagle Mines has a low cost per once to extract gold, reducing its vulnerability to rising diesel prices.
As clouds of geopolitical uncertainty loom over global markets, investors are turning to the mining sector. Precious metals prices have been on the rise in recent years, driven by escalating geopolitical tensions and a noticeable shift as more central banks across the globe secure safe-haven assets like gold.
Equinox Gold (NYSEMKT: EQX) and Agnico Eagle Mines (NYSE: AEM) are poised to benefit from rising precious metals prices. However, increasing fuel prices amid the conflict in Iran have weighed on the miners’ stocks, which are now down 20% and 15%, respectively, from their recent highs.
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Amid the uncertain backdrop, one stock stands out as a more compelling buy today. Here’s why.
Image shows gold and silver bars and barrels of oil sitting on papers that display financial numbers.
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Equinox Gold is shifting toward more-stable mining assets
Equinox Gold has been undergoing a shift as it moves its mining assets toward Tier 1 jurisdictions, such as Canada, to expand its capacity. In the world of mining, operating in Tier 1 regions provides a high standard of operational and political stability, making it a more reliable investment with lower risk. This year, Equinox is on pace to increase its annual output in Canada by 80% from its mines in Ontario and Newfoundland.
As part of this, the company has divested its Brazilian operations, selling its mining assets to CMOC Group for over $1 billion. The company used this to retire $990 million in debt and launched its first-ever dividend in March 2026 at $0.015 per share per quarter.
The company has guided for an all-in sustaining cost (AISC), which represents the operational cost of producing an ounce of gold, between $1,775 to $1,875 per ounce. This represents a decrease following the sale of its Brazilian assets and expansion in Canada. However, because it focuses on large-scale open-pit mines, the company is sensitive to rising diesel prices, which have spiked recently amid the ongoing conflict in Iran.
Agnico Eagle Mines benefits from low production costs
Agnico Eagle Mines is a low-cost producer with an AISC of $1,400 to $1,550 per ounce. Compared to Equinox, Agnico has a higher percentage of underground operations, which move far less waste rock per ounce of gold. The company can keep costs low by owning multiple mines close to one another.
A big chunk of Agnico’s production comes from the Abitibi region of Canada. This location benefits from low-cost hydroelectric power, which helps to insulate the company from rising diesel prices that can hurt more-remote mines. The company has also invested in fleets of battery electric vehicles for underground hauling, further reducing its dependence on diesel.
Management has maintained a lower-cost production capability, so it has rarely had to issue debt or equity to fund its growth and build new mines. It has also paid a quarterly dividend every year since 1983.
Equinox has diversified its mining assets into a safer region and is lowering its AISC by expanding its Canadian operations. That said, it faces higher costs and is more vulnerable to diesel price spikes. Meanwhile, Agnico Eagle is more insulated from rising fuel prices, which is why I think it stands out as the better mining stock for investors right now.
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Courtney Carlsen has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.