When it comes to finding a mining stock to watch, there are a few factors that investors should consider. Most of the time, investors tend to think of gold stocks when they look at the mining industry. While gold has shot up greatly in value in 2020, other mining stocks have as well. Mining stocks are some of the best ways for investors to hedge bets against greater market volatility. While many mining stocks are stable in price action, there are some that are still quite volatile.
When searching for a mining stock to watch, investors should make sure that they know their individual volatility threshold. This means assessing ones portfolio, and knowing how much risk one is willing to take on. Throughout 2020, mining stocks have seen a great deal of growth. But, with the economy slowing down this year due to Covid, many investors believe that the real potential for mining stocks is in the long term.
Investors have also stated that once Covid comes to an end, countries will begin working on large industrial expansion projects once more. This could lead to greater demand for mined ores such as building materials. In addition, precious metal mining stocks have shot up in value this year, as they often are chosen as a way to counter inflation. With the Fed dropping interest rates to near zero, some investors fear that inflation could be on the horizon. For this reason, mining stocks continue to look quite attractive. With this in mind, let’s take a look at four mining stocks to watch with high expectations from investors.Mining Stocks to Watch:
- Walcott Resources Ltd. (OTC : WALRF Stock Report) (CSE : WAL)
- First Majestic Silver Corp. (AG Stock Report)
- Fortuna Silver Mines Inc. (FSM Stock Report)
- Sibanye-Stillwater Ltd. (SBSW Stock Report)
Walcott Resources Ltd. is an interesting mining stock that only recently began trading in the U.S. Before its move to the OTC, Walcott Resources Ltd. was trading on the CSE. This move has helped the company to gain some traction amongst U.S. investors. Recently, the company announced that it has closed on the acquisition of 60% of the issued and outstanding shares of 1256714 B.C. Ltd. This deal should offer Walcott a much greater amount of access to silver and zinc mining in Australia.
Within this deal comes two notable silver-zinc mining projects known as the Tyr Silver Project and the Century South Silver-Zinc Project. If you’re not familiar with the role of Australia in silver mining, it is considered to be one of the top 3 countries with the largest silver reserves in the world. The Tyr Project, which is based in New South Whales, has two silver mines with major historic significance. These mines together have the potential to produce high grade silver zinc-lead-tin in one of the most mineral rich mining areas in the world.
In the past, Mexico has been considered to be the top country for silver mining. But, Australia, Peru, and Poland all have vast and untapped silver reserves. Although Walcott is a newcomer to U.S. investors, the company has shown a great amount of momentum on the CSE in the past. Since mid-August, shares of WAL stock have shot up by over 200%. With the announcement of the aforementioned deal, WAL stock could have even more forward momentum in the near future. Because of its role in the silver mining industry, WAL stock could be one of the mining penny stocks to watch right now.Mining Stock to Watch: First Majestic Silver Corp.
First Majestic Silver Corp. is another mining company working on the acquisition, exploration and development of silver mines. The company has a primary focus in Mexico, where a great deal of silver production occurs. More specifically, First Majestic has several key silver mines. This includes the San Dimas Mine, the Santa Elena Mine, the La Encantada Mine and more. In addition, First Majestic states that it also has mined in Canada, where there is also a great deal of silver ore. Recently, First Majestic Silver Corp. announced its third quarter production results.
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Within these results, the company stated that it produced 5.2 million silver equivalent ounces and 25,771 ounces of gold. This represents growth over the previous quarter of 72% and 63% respectively. Because of this large growth, many investors believe that AG stock is a solid pick for a mining penny stock to watch.
One of the major factors behind these numbers is the price increases for both silver and gold. This year, the price of gold has shouts by around 25% while silver has climbed by 34% in 2020. While First Majestic primarily works in the mining of silver, it does do a bit of gold mining as well.Mining Stock to Watch: Fortuna Silver Mines Inc.
Fortuna Silver Mines Inc. is a Canadian based precious metals mining company. The company states that it has operations in several countries around Latin America. This includes Mexico, Peru, and Argentina. One of the key things that separates Fortuna Silver Mines is its commitment to sustainable mining. This ensures that its mines can be used in the long term without the worry of overuse.
Similar to other silver mining companies, Fortuna Silver Mines also works in the mining of gold and other resources. Recently, the company announced that it had completed its first gold pour at the Lindero Mine in Argentina. President and CEO of the company, Jorge Ganoza, stated that “the first gold pour at Lindero, our third mine in the Americas, is a significant achievement for the company as we advance the mine’s ramp-up phase towards commercial production in the first quarter of 2021. Lindero is a mine with reserves for a projected life of thirteen years and is a pillar in Fortuna’s asset portfolio.”
On October 21st, shares of FSM stock were up by as much as 6% during intraday trading. In the past six months however, shares are up by around 210%. This large bullish sentiment surrounding FSM stock shows just how much faith investors have in the company. For this reason, investors should continue to view it as a leading mining stock to watch.Mining Stock to Watch: Sibanye-Stillwater Ltd.
Sibanye-Stillwater Ltd. is considered to be the largest gold producer in South Africa. In addition, the company is one of the top ten gold producers around the world.
On October 21st, shares of SBSW stock shot up by around 10% during intraday trading. The main reason behind this jump is the redemption of a convertible note that was announced prior to trading. After Sibanye acquired Stillwater for $2.2 billion back in 2017, the two became a much broader based, singular mining company. Sibanye stated that the goal of this acquisition was to move more into platinum group metals.
Since the acquisition, the two have been working on reducing overall debt, and increasing mining around the world. The announcement of the redemption of a $450 million convertible note, should help to reduce the overall debt on the company’s books. In the past few years, the company has seen its production shift to 90% platinum group metals and the other 10% from gold.
With this, not only can the company mine more materials, but it has also stated that it will begin offering a dividend once more. With its commitment to getting its books back on track, SBSW stock continues to be highlighted as a mining penny stock to watch. However, investors should make sure that they are watching what the company does to ensure its debt continues to go down in the future.