For many years, TRX Gold (TRX +10.42%) was a penny stock, trading for less than a dollar per share. In late 2025, the stock started to rise along with gold prices. And, in 2026, when gold prices spiked sharply, TRX Gold's stock price jumped well over $1 per share. Is this precious metals miner a diamond in the rough or not worth the risk?
Sell or avoid TRX Gold?
Most investors will want to steer clear of TRX Gold. For starters, it is still a very low-priced stock. At the time of this writing, it was trading hands for less than $2 per share. That is for a good reason; it is a tiny company and a high-risk investment. On the size front, the stock's market cap is around $500 million. That is pretty small when you compare the company to more established precious metals miners like Barrick Mining (B +2.71%), which has a nearly $80 billion market cap.
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It may seem unfair to compare TRX Gold to an industry giant like Barrick, but conservative investors are usually better off avoiding start-up businesses. And that's basically what TRX Gold is.
Buy TRX Gold?
That said, more aggressive investors may be interested in TRX Gold due to its growth potential. It has a producing gold mine in Africa that it believes offers material expansion opportunities. If those opportunities pan out, production could dramatically increase in the years ahead. While there is material up-front capital investment needed to make that happen, rising production could eventually lead the company to profitability.
NYSEMKT: TRX
Key Data Points
"Could" is an important word, because there are a few important problems that could arise. For example, production could fall short of expectations, the miner could experience execution problems, or it could have difficulty raising the capital it needs to fund the investment. Those are all idiosyncratic risks. Also, this is a big one; gold prices may not cooperate.
If you buy TRX Gold, you need to understand that rising gold prices have played a major role in the stock price advance. If gold prices retreat, it is highly likely that TRX Gold's share price will follow suit.
Hold TRX Gold?
If you already own TRX Gold, you presumably understand the risks and the opportunities. There's no particular reason to sell it, though you will need to make sure you can handle the volatility that comes along with owning a tiny precious metals stock. If the volatility keeps you up at night, you should probably cut your losses and sell. Indeed, the longer-term mine development opportunity here could take years to play out.
