Pan African Resources (LSE:PAF) leads the pack, with a market-crushing return of 797%. Next comes a huge 348% gain from TBC Bank Group (LSE:TBCG), while Goodwin (LSE:GDWN) narrowly gets bronze with 313%. Note, none of these returns include dividends!

So, here we have an African-focused gold miner, an emerging markets bank (Georgia’s TBC), and family-run engineer Goodwin. An honourable mention should go to construction group Galliford Try, which has also returned around 312% over five years.

What has driven these extraordinary gains?

Benefiting from big investing trends

Pan African’s eye-popping gain can be summed up with one word: gold.

As a gold miner, its profits are highly leveraged to the price of the yellow metal. And even after the recent pullback, gold is still up by roughly 175% in five years.

When gold prices soar, a miner’s profits will often grow much faster than the price of the metal itself because extraction costs stay relatively fixed. As such, Pan African’s net profit has exploded from $44m in 2020 to an expected $470m this fiscal year (ending June). Wow!

Meanwhile, Goodwin’s benefitting from the defence and nuclear renaissance. It makes high-integrity castings, particularly those that don’t melt under extremely high temperatures. Not many companies in the world specialise in these.  

Bottom-line profits have grown at an annualised rate of 25% since 2020. And Goodwin investors have enjoyed lots of dividends along the way. 

Is either still worth considering?

The last time I wrote about Goodwin (in October), I concluded that the stock looked too pricey. Back then, the price-to-earnings (P/E) ratio was 60 while the dividend yield was just 1.4%.

Since then though, the Goodwin share price has crashed almost 40%. And now we have a P/E ratio of 24 and a 2.2% yield that may be worth considering.

Much of this loss came in a single day in March when Goodwin revealed it had lost two major tenders in its Mechanical Engineering division (worth about £60m). And it has delayed the dispatch of valves to some customers due to the Iran war.

Taking a longer-term view, however, it should have plenty of growth options across the European nuclear, aerospace and defence sectors. After all, it has finally dawned on Europe that these things are actually rather important in a fragmenting international order.

Pan African’s fate will, of course, be dictated by the gold price. Personally, I prefer Fresnillo from the FTSE 100 as it mines silver too. But both stocks could tank if gold does.

Ultra-cheap stock

Turning to TBC, I’m more bullish on this bank stock. It’s trading at just 5.7 times forward earnings, while offering a 6.2% forecast dividend yield.

Granted, any economic downturn in Georgia is a risk, while the political scene there is still on edge. But this economy is tipped to grow strongly for years, as is Uzbekistan’s (TBC’s second market).

The lender is extremely profitable, benefitting from its duopolistic position in Georgia and an increasingly digital-first approach. Given the extremely low valuation, strong growth potential, and generous starting dividend yield, I think TBC stock is still worth looking at today.

The post Meet the skyrocketing FTSE 250 stocks up by more than 300% in five years! appeared first on The Motley Fool UK.

Sudden shocks can slash the dividends paid by individual stocks. Yet with a diversified mix of income shares, investors can still enjoy a strong income even when one or two holdings fall short.

Here’s one top dividend share I think demands further research in February. Read on to see what makes could make it worth serious consideration for a passive income portfolio.

Dividend growth

Dividends are surging at Pan African Resources (LSE:PAF) as gold prices take off. This week it announced an interim dividend of 0.54745p per share, driven by a resurgent metal price and a sharp production increase (up 51% in the six months to December).

For the full financial year to June, the gold stock’s tipped by analysts to pay a 3.2p per share total reward. As a consequence, its forward dividend yield is 2.3%.

So what’s so exciting about that, you ask? It isn’t, to put it simply. That yield’s even below the FTSE 250 index’s broader average of 3.2%.

But what really excites me is the possibility of rapidly growing dividends. To give a taste, Pan African’s expected to hike the full-year dividend to 4.73p per share in the next fiscal year, driving the yield to 3.3%.

Gold rush

There are several reasons I’m confident dividends can keep storming higher. Gold prices continue to boom, hitting fresh records around $5,600 an ounce in recent days. Analysts are increasingly confident they can keep storming higher — the boffins at Wisdomtree have said bullion could reach $5,995 by Q4, if the Federal Reserve aggressively cuts interest rates and the US dollar sinks.

Secondly, Pan African’s production is soaring. It’s on course for 275,0000 to 292,000 gold ounces this financial year, up from 197,000 last time out. Further out, group output could surge as its Mogale Tailings Retreatment (MTR) and Tennant Mines projects ramp up to full capacity.

Finally, the gold producer is financially robust and in great shape to supercharge dividends. Net debt dropped 65% to $49.9m as of December, and the miner’s expecting to be debt free next month.

What could go wrong?

As I said at the top, there’s no such thing as a guaranteed dividend. With Pan African Resources, shareholder payouts could miss analyst targets if gold prices head lower instead. They could also disappoint if the miner’s asset expansion plans hit trouble.

Yet on balance, I’m confident the gold stock can hit current dividend forecasts. It’s also worth mentioning predicted payouts are covered between 4.5 times and six times by expected earnings through the next two years. This provides added protection in case earnings are blown off course.

I think Pan African’s deserves serious attention as a passive income stock, and especially at current prices. Its price-to-earnings (P/E) ratio is a rock-bottom 9.9 times.

The post Here’s a red-hot passive income idea for an ISA for February! appeared first on The Motley Fool UK.

Here is what I consider to be one of the index’s best cheap stocks right now. While I don’t hold shares in it today, I’m looking to add them to my portfolio in the coming weeks. Want to know why?

Going for gold

Pan African Resources (LSE:PAF) shares have soared over the past year, driven by a booming gold price. With bullion’s bull run looking in great shape, I’m expected the gold stock to keep rising.

There are many reasons to expect precious metals to strengthen, in my view. One that’s dominated again this week is uncertainty over the US Federal Reserve’s independence, which is rattling markets and weakening the US dollar. It propelled gold prices to new peaks near $4,635 an ounce.

I’m expecting the US currency to keep slipping in 2026 and potentially beyond, making it increasingly cheaper to buy gold. Meanwhile, I expect the yellow metal to keep gaining as interest rates fall, boosting inflation, and as geopolitical instability increases across the globe.

Expanding for growth

Pan African Resources is well placed to capitalise on this fertile backdrop for gold. Its high-margin Mogale Tailings Retreatment (MTR) project in South Africa reached steady‑state production in 2024. And its Nobles asset at Tennant Mines in Australia is steadily ramping up following maiden production in 2025.

Accordingly, the FTSE 250 firm expects to produce 275,0000 to 292,000 gold ounces this year. That’s up from 197,000 during fiscal 2025. Beyond the short term, Pan African has significant exploration potential — particularly in the Tennant Creek Mineral Field in Australia’s Northern Territory — and a strong balance sheet to support this.

The beauty of holding gold stocks over physical metal or a gold-tracking exchange-traded fund (ETF) is the leverage factor. Investing in miners leaves individuals exposed to the unpredictable business of metals excavation. In this case, the share price could fall even if gold keeps rising if, for instance, the production ramp-up at Nobles hits problems.

A gold-plated bargain

But the benefits of leveraged exposure can more than offset this. For instance, if gold prices rise 5%, a mining share’s profits could rise 15% to 20% as it earns more per ounce while costs remain relatively stable.

This is why Pan African’s share price has risen 233% over the past year, eclipsing the 72% increase in gold prices.

Despite these heady gains, the FTSE 250 miner still offers exceptional all-round value. At 122.4p per share, it trades on a forward price-to-earnings (P/E) ratio of 8.6 times for this financial year (to June 2026).

And for next year, Pan African’s earnings multiple drops to seven times. I think the company — promoted to the FTSE 250 from the AIM market in October — could be one of the UK’s hottest mining stocks.

The post 1 of my favourite FTSE 250 bargain stocks right now! appeared first on The Motley Fool UK.

Pan African Resources (LSE:PAF), AJ Bell and Polar Capital Technology Trust are three that have caught my eye. Want to know what I think makes them top stocks to consider at the start of 2026?

Gold star

Gold looks like it could have further to climb after last year’s electrifying gains. So buying gold stocks could be a great option to think about, given their profits tend to rise more sharply than metal prices during bull markets.

Pan African Resources is one gold producer tipped for further breakneck profits growth. Analysts expect earnings to soar 90% this financial year (to June 2026), and another 15% the following year.

The company has ambitious production targets to capitalise on this favourable landscape. It’s on course for 275,0000 to 292,000 ounces this year, up from 197,000 during fiscal 2025.

So on balance, I’m expecting Pan African to add to 2025’s share price increases. It rose 263% over the year, outpacing the gold price, which rose a more modest (if still impressive) 65%.

I think it’s a top stock to consider, even though production setbacks are a constant danger that could hit its share price.

Besides, today Pan African’s shares trade on a forward price-to-earnings (P/E) ratio of just 8.7 times. This could limit any potential falls in the event of operational problems.

Accelerating growth

AJ Bell’s another FTSE 250 share with bags of earnings potential. A rapidly ageing UK population, combined with rising interest in financial planning, is driving demand for retail investment experts like this.

It’s why City analysts expect this company’s earnings to rise 5% this financial year (to September 2026). Despite the danger of high market competition, annual growth is tipped to double to 10% in financial 2027 too.

AJ Bell’s October update showed customer numbers up 19% last year, propelling investment inflows and assets under management to record highs. I think there’s plenty of scope for further growth, helped by falling interest rates on savings accounts and Cash ISA changes.

A bargain growth stock

Meanwhile, Polar Capital Technology Trust provides an indirect way for investors to harness the growth potential of US tech shares. In 2025 it enjoyed share price gains of 33%, powered by industry heavyweights like Nvidia, Apple and Alphabet.

So what’s the point of considering this FTSE 100 trust instead of US stocks directly, you may ask? One reason is the excellent diversification it offers. With 91 holdings, it provides great protection if one or two companies face difficulties.

The second is that today the trust is at a low price. At 470.7p, it trades at a 10.2% discount to its net asset value (NAV) per share.

It could experience turbulence if worries over a tech bubble rise again. But over the long term, I’m optimistic Polar Capital Technology can be one of the UK’s hottest growth shares.

The post 3 top FTSE 100 and FTSE 250 growth shares! appeared first on The Motley Fool UK.

I’ll admit, mining isn’t a sector I pay much attention to as the potential volatility is outside of my usual risk tolerance. Still, it’s fair to say I regret missing this once-in-a-lifetime opportunity. So for those investors who did get in on the action, the question is: will it keep climbing, or is it time to cash in?

Let’s take a closer look.

The gold factor

Last year (2025) saw an historic 65% gold price rally, the strongest annual gain since 1979. But that alone wasn’t the only factor that drove Pan African’s success. The company compounded its gains with aggressive cost management and strategic execution of transformative production expansion projects.

Now, as the company prepares for 2026, the sustainability of these gains depends heavily on gold price stability — a variable beyond management control. Success hinges on how well it can weather the increasing likelihood of a gold price correction. 

Operational strength

In 2025, Pan African’s revenue surged 44.5% to $540m while profit nearly doubled 78.4% to $140.6m. That was largely driven by a 35.7% increase in the average gold price to $2,730 per ounce. But more importantly, the company achieved a profit margin of 70.9% on AISC (all-in sustaining costs), compared to just 32.8% in FY2024 — a dramatic expansion of earning power.

Operationally, Pan African commissioned two major projects ahead of schedule. The Mogale Tailings Retreatment (MTR) plant contributed 22,000 ounces of low-cost production in H2 FY2025, and Tennant Mines in Australia achieved its first gold pour in May.

This positioned the company for 40% production growth to around 285,000 ounces in FY2026. With AISC expected to fall to around $1,500 per ounce while production scales, the company could be entering a period of exceptional profitability — if gold prices hold.

This is where the investment thesis becomes precarious. Analyst gold forecasts for 2026 range from bearish ($3,360) to ultra-bullish ($5,000), with meaningful probability assigned to each outcome. The World Gold Council identifies a 20% probability of a 5%-20% correction if the Trump administration’s policies succeed, triggering higher interest rates and USD strength.

Some fear this scenario could push gold below $4,000. On the bullish side, continued geopolitical risk and Fed rate cuts could support a push towards $4,800 or higher.

My verdict

This is a classic risk/reward play. For existing shareholders, locking in gains couldn’t hurt — but there may be more to come. For new investors, there’s a chance it could go either way.

In my opinion, what matters most is how well the company has exhibited operational efficiency in 2025. When thinking long-term, that’s what to look for in a company. Whether gold dips or not, I think Pan African Resources is a stock worth considering as a long-term gold play.

If it continues to operate with the same strength it exhibited in 2025, it could one day be a major FTSE 100 miner.

The post What’s next for the best-performing FTSE 250 stock of 2025? appeared first on The Motley Fool UK.

UK shares have easily outperformed their peers in other developed markets, including the US. And yet London-listed companies still look dirt cheap on the whole.

Alex Wright, portfolio manager at Fidelity, notes that “UK equities still trade at a meaningful discount to global peers“. Could that discount be the catalyst for another powerful rally in 2026?

Time to shine (again)?

Though noting that UK shares enter 2026, “from a position of strength“, Wright commented that London-listed shares still trade at a healthy discount “both on outright price to earnings multiples and after adjusting for structural sector differences, such as the heavy weighting of technology in US indices“.

Interestingly, Wright added that many of the domestic stock market’s value opportunities can be found “further down the market cap spectrum“.

Accordingly, he said that “our strategies maintain a structural bias towards these smaller and mid-sized businesses, as these businesses are typically less well known to investors and often receive limited and artificial coverage” by brokers.

So is now the time to consider focusing on small- and mid-caps?

Value hero

I personally think a blend of FTSE 100 and other UK shares is a good way to balance risk and potential reward. But let’s look at some of those lessen-known heroes and consider why they could outperform in 2026.

Pan African Resources (LSE:PAF) has risen 211% this year, driven by a robust gold price and strong operational performances. Yet it still looks dirt cheap on paper, trading on a price-to-earnings (P/E) ratio of 7.8 times.

A stalling or falling bullion price could naturally have an adverse impact on the miner’s price next year. But I’m confident gold prices should keep climbing as interest rates drop, and macroeconomic and geopolitical uncertainty persist.

JP Morgan predicts the yellow metal will reach $5,055 an ounce by this time next year — up from $4,330 currently — before marching to $5,400 at the end of 2027.

Pan African’s supercharging production to capitalise on this environment, too. It’s targeting full-year output of 275,0000-292,000 ounces next year, up from 197,000 ounces in 2025.

More cheap stocks

Topps Tiles — which has risen 20% year to date — also looks cheap, with a forward P/E ratio of 10.4. Competition is intense across its markets, but with interest rates falling and mortgage lenders slashing loan costs, sales volumes could surge as the housing market improves.

I also like Lion Finance, which carries a forward P/E of 6.9. I think 2026 could mark another year of strong progress as — despite rising political risks — Georgia’s booming economy continues to turbocharge loan growth.

The emerging market bank’s almost doubled in value this year.

The post Forget the FTSE! Consider these 3 stocks for a 2026 market rally appeared first on The Motley Fool UK.

Take Pan African Resources (LSE:PAF), whose shares have leapt 164% in value during the past 12 months. With production rising and gold hitting high after high, the number crunchers are unanimous in their opinion of further explosive price gains.

The most bullish forecast suggests Pan African’s share price will rise another 19% over the next year, to 112p per share. The average estimate among brokers is a lower 108.6p, but that still represents a healthy 15% increase.

That may seem like small potatoes given the gold stock’s enormous returns of the last year. But it’s not to be baulked at, in my view. Based on the City’s share price and dividend projections combined, investors could enjoy a tasty 19% total return over the next 12 months.

I think Pan African could deliver even better returns that this.

Gold shines

One reason is that broker forecasts have consistently failed to keep up with gold’s breathtaking price gains. HSBC analysts as recently as June tipped the precious metal to trade between $3,100 and $3,600 per ounce for the remainder of 2025.

Yet gold breached the upper end of that range just three months later and have since hit record peaks above $4,300 per ounce. To be fair, HSBC analysts aren’t the only ones to be caught cold by gold’s stunning rise.

Of course there’s no guarantee that gold’s price can keep up this pace. But accelerating demand from retail investors and strong central bank purchasing suggests further strength is possible. I feel the economic factors fuelling gold’s stunning rise — from tariff uncertainty and rising inflation, to ongoing US dollar weakness — should continue to play out.

A dirt cheap growth share

These forecasts point to strong, double-digit earnings growth for Pan African Resources. Broker estimates are never guaranteed, though, and the business could disappoint even if gold keeps rising.

Mining is a famously hard and unpredictable business, and profits can slump if operational issues occur. But having said that, Pan African’s strong record on the ground helps soothe any fears I have on this front. Production rose 6% in financial 2025, to 196,527 ounces, thanks in large part to its Mogale Tailings Retreatment (MTR) project being ramped up ahead of schedule.

Despite the gold miner’s impressive price gains, it still looks cheap in my opinion. I don’t think those low P/E and PEG ratios reflect its operational resilience and great growth potential, and reckon it’s a top stock to consider right now.

The post Prediction: analysts say this growth stock will surge 19% in a year! appeared first on The Motley Fool UK.

With the price at $4,140 today, this forecast suggests more gains could be ahead. Here are two gold stocks that should continue doing well if the yellow metal surges to $5,000. Both are worthy of attention.

FTSE 100

Let’s start with the highest-profile, which is Mexico’s Fresnillo (LSE:FRES). Incredibly, this FTSE 100 stock has gained more than 300% in 2025 alone!

Fresnillo is one of Latin America’s largest gold miners. In the first half of 2025, it produced 313,800 ounces of gold, and expects that figure to be as high as 590,000 for the full year. 

The miner’s efficiency drive is really paying off. At its key Herradura gold operation, the ‘all-in sustaining cost’ (AISC) was $1,372 per ounce in the first half, down from $1,915 a year earlier. So if gold hits $5,000, Fresnillo’s profits should continue soaring.

However, Fresnillo is also the world’s leading silver producer. In the first half of 2025, it churned out 24.9m ounces of it.

According to its recent Mining Forum Americas 2025 presentation, its group-wide AISC for silver is around $17.50. As I type, silver is above $52, roughly 66% higher than a year ago. This is incredible for Fresnillo.

After its stunning rally, the stock isn’t cheap at 23 times forward earnings. However, I don’t think the valuation is bonkers given the various trends underpinning gold’s rise, including sticky inflation, record central bank buying, mounting government debt, and geopolitical unease.

The forecast dividend yield is 2.8%, while the probability of special dividends is high (though not guranteed, of course).

AIM stock

The second option is AIM-listed Pan African Resources (LSE: PAF). Shares of this pureplay gold miner are up 167% year to date and 350% over five years!

Pan African operates mines in South Africa and Australia, producing roughly 200,000 ounces a year. With a five-year return on invested capital (ROIC) of 49%, it’s among the most profitable mid-tier gold miners around.

Pan African’s AISC was $1,600 in FY25, but this is expected to ease to between $1,525 and $1,575 this year (FY26). Management sees output climbing more than 40% as new operations ramp up.

The miner’s valuation looks attractive here. The forward earnings multiple is just 7.7, while the yield climbs to 3.5% by next year. 

Foolish takeaway

Of course, a sharp correction in the gold price would negatively impact future profitability at both Fresnillo and Pan African. Meanwhile, things can always go wrong at key mines, including shutdowns due to safety accidents, as well as strikes. Persistent inflation, while benefitting gold, is also a headache for miners.

However, in terms of bullion itself, it tends to shine brightest when uncertainty rises. As mentioned, we have loads of that with currency debasement, high government debt, and President Trump’s on-off tariffs.

Goldman Sachs forecasts average central bank gold purchases of 80 tonnes this year, followed by 70 tonnes in 2026, as emerging markets pursue reserve diversification. This is a very powerful ongoing global trend.

Stepping back, gold’s epic bull run appears to have further to go.

The post Gold to $5,000? 2 UK stocks to consider buying right now appeared first on The Motley Fool UK.

Pan African Resources

First up, we have Pan African Resources (LSE: PAF). This is a mid-tier miner that has operations in Africa and produced 196,527 ounces last financial year (ended 30 June).

What I like about this company is that it has very low operating costs. For its most recent financial year, its ‘all-in sustaining costs’ (AISCs) per ounce of gold were just $1,600. So at current gold prices, its profits are likely to be huge. And if gold keeps going up, the company could make even more money.

I also like the rising dividend. Currently, analysts expect a payout of US 4.5 cents per share for this financial year, more than double the payout last year. That dividend forecast translates to a yield of about 3.7%.

As for the valuation, it remains low. Currently, this stock has a price-to-earnings (P/E) ratio of just eight. Put all this together, and there’s a lot to like here.

Hochschild Mining

Next, we have FTSE 250 company Hochschild Mining (LSE: HOC). It mines gold (and silver) in a range of countries including Argentina, Peru, and Brazil.

Hochschild’s operating costs are a bit higher than those of Pan African Resources. For the first half of 2025, gold AISCs were $1,914 per ounce. At those cost levels, however, the company is still cleaning up. For H1, profit before tax was up 102% year on year to $140m.

One thing I like about this company is its silver exposure. This year, silver prices have actually risen more than gold prices. Note that in H1, Hochschild’s AISC for silver was just $23. That’s far lower than the silver price today (about $48).

Turning to the valuation and dividend, the P/E ratio’s 8.3 and the yield’s 1.7%, (looking at forecasts for 2026). So there’s both value and income on offer.

Caledonia Mining

Finally, check out Caledonia Mining (LSE: CMCL). It’s a smaller producer that operates in Zimbabwe. In the first half of 2025, this company produced around 40,000 ounces of gold. AISC for the period was $1,801.

Looking ahead, this company should be able to make plenty of money with the price of gold near $4,000. Currently, analysts expect the group’s net profit to amount to around $63m this year – roughly 250% higher than the figure posted last year.

At present, this stock trades on a P/E ratio of around 11.7. So it appears to be reasonably valued. The yield’s about 1.5%. So there’s a little bit of income on offer too.

The key to investing in gold stocks

While all these stocks have potential, it’s important to understand risk as there’s a lot that can go wrong. For example, equipment can break down, weather can be poor, staff can go on strike, and governments can impose new restrictive laws. So there’s no guarantee that these shares will be good investments.

I think the key for anyone buying is to size these stocks carefully with small positions. That way, potential gains can be enjoyed without being exposed to excessive risk.

The post 3 UK gold shares to consider buying as bullion prices hit $4,000 appeared first on The Motley Fool UK.

Now, there’s no guarantee that the precious metal will go to $5,000 next year, of course. However, if it does, I’d expect UK gold stocks to soar.

Leveraged plays on gold

When gold prices are rising, gold mining stocks often provide bigger gains than the commodity itself. This is because they benefit from operational leverage.

Typically, gold miners have relatively fixed operational costs. So when gold prices are rising and their revenues are higher, they tend to see a sharp increase in profitability.

For example, let’s say it costs a gold producer $2,000 to produce an ounce of gold. When the price of gold is $3,800 per ounce (near where it is today), the company’s profit is going to be $1,800 per ounce.

If the gold price were to rise to $5,000 however, the company’s profit per ounce rises to $3,000. So a 32% increase in the price of the commodity has resulted in a 67% increase in profitability for the producer.

Two UK gold stocks to watch

Zooming in to UK gold stocks that could potentially benefit from higher gold prices, one worth highlighting is Pan African Resources (LSE: PAF). It’s a mid-tier miner that’s focused on mining gold in Africa.

This company is already producing gold, so it’s likely to benefit from higher prices. For the year ended 30 June, it produced 196,527 ounces, an increase of 5.6% year on year.

Meanwhile, it has very low costs – for its most recent financial year its ‘all-in sustaining costs’ (AISC) were just $1,600. So if gold was to rise to $5,000, this company would most likely clean up.

Given this set-up, and the fact that dividends are rising rapidly, I think this stock could be worth considering for those looking for gold stocks to buy. Especially now that the company’s looking to move from the AIM to the UK’s main market – this could make the stock appealing to a wide range of investors.

Another stock worth mentioning is Caledonia Mining. It’s a smaller miner that’s focused on gold production and exploration in Zimbabwe.

In the first half of 2025, it produced around 40,000 ounces of gold, generating revenue of around $121m. AISC for the period was $1,801. So like Pan African Resources, it’s making a ton of money right now and well placed to benefit from rising gold prices.

Understanding the risks

Now, it’s worth noting that with these kinds of gold mining companies, there are a lot of things that can go wrong. For example, companies can experience setbacks as a result of mine problems, staff strikes, weather conditions, and more. So there’s no guarantee they will perform well as investments, even if the gold price rises significantly.

For those keen to invest in gold stocks however, I think these names are worth a look.

The post If gold rises to $5,000 in 2026, these UK stocks could soar appeared first on The Motley Fool UK.