In this piece, we will take a look at the 12 best mineral stocks to buy now. If you want to skip our introduction to the mineral industry and some recent news, then take a look at the 5 Best Mineral Stocks To Buy Now.
While money makes the world go around, the same can also be said of minerals. After all, the global economy is built on humanity's reliance on steel - which is made from a mineral. Then, silica, which is the backbone of the technology industry through its use in making semiconductors is also a mineral. As if this weren't enough, copper and lithium which are indispensable to humanity's fight to reduce global emissions, are also minerals.
This makes it clear that minerals go hand in hand with the economic prosperity of today and tomorrow. Naturally, the minerals and mining industry is also one of the biggest in the world when it comes to market value. For instance, data from The Business Research Company shows that the global mining market was worth $2.02 trillion in 2022 and it is slated to grow to sit at $2.1 trillion by the end of this year after growing through a compounded annual growth rate (CAGR) of 6.1%. Then, the growth rate is expected to accelerate, as the research firm estimates that until 2027, the mining industry will have a 6.7% CAGR and a final value of $2.78 trillion.
Within the mineral industry, there are several different kinds of products that are produced. Minerals are generally defined as naturally occurring solid materials with defined atomic structures, which means that they cover nearly every metal known to humanity. This broad definition also means that the mineral industry is quite diverse with several different use cases, such as those we've mentioned above.
Delving deeper, while minerals are essential for the world's normal functioning today as well as future initiatives, capital expenditure within the mining sector varies with fluctuations within the commodities market. When prices are high, firms are encouraged to spend more to beef up their production, and when prices fall, they cut down on investments. Data from McKinsey shows that global capital expenditures in mining were cut in half from $260 billion in 2012 to $130 billion in 2020. This is concerning since progression with renewable and alternative energy sources is dependent on vibrant and robust investments in global mining capabilities. McKinsey adds that from 2016, the dollar value of mining capital expenditures started to grow but their percentage with respect to operational cash flows still remained low.
Shifting gears to narrow down our focus on mineral companies, one of the most important companies right now is Albemarle Corporation (NYSE:ALB). Albemarle is crucial to the minerals industry since it is one of the biggest suppliers of lithium in the world. Lithium, if you're unaware, is crucial for the electric vehicle industry, and Albemarle is known for its crucial relationship with car companies including the electric vehicle giant Tesla, Inc. (NASDAQ:TSLA). However, while everyone agrees that the long term prospects of lithium are quite strong due to its use in batteries, 2023 has been a rather surprising year for the industry. This is because lithium prices have considerably dropped this year, and as we mentioned above when prices drop, capital expenditures are also often reduced. You can also read 10 Most Profitable Lithium Stocks Now for more details about lithium stocks.
The scale of the 2023 lithium price crash is not widely reported either. As an example, consider the average price of battery grade lithium carbonate in China. This stood at $84,500 per metric ton in November 2022, but a year later, has dropped by a rather stunning 78% to sit at $18,630 as of late November 2023. At the heart of this drop is the current global investment and economic climate, as high interest rates have also put the brakes on global electric vehicle demand and high inflation coupled with labor market uncertainty has limited the amount of money that people can fork out themselves for pricey car purchases.
At the same time, mining and minerals firms are also speeding up their investments in environmentally friendly technologies to reduce the impact of their operations on their surroundings. For instance, one of the biggest mining companies in the world, the British giant Rio Tinto Group (NYSE:RIO), is currently investigating the use of a bio-friendly material to replace the reliance on dirty coking coal for producing a titanium ore used to make plastics, inks, and fabrics.
Today, we'll take a look at some top mineral stocks to buy with the notable picks being Freeport-McMoRan Inc. (NYSE:FCX), Teck Resources Limited (NYSE:TECK), and Agnico Eagle Mines Limited (NYSE:AEM).
12 Best Mineral Stocks To Buy Now
A close-up of a medical device implant, emphasizing its titanium component.
Our Methodology
To make our list of the best mineral stocks to buy, we ranked the 30 biggest aluminum, copper, gold, silver, and other metals and mining companies by the number of hedge funds that had bought their shares in Q3 2023. Out of these, the top stocks were selected.
B2Gold Corp. (NYSE:BTG) is a Canadian gold mining company which is headquartered in Vancouver, Canada. Its third quarter financials saw the company's revenue grow by 22% annually. The shares are rated Buy on average and analysts have set an average share price target of $4.42.
As of Q3 2023 end, 19 out of the 910 hedge funds polled by Insider Monkey had bought and owned B2Gold Corp. (NYSE:BTG)'s shares. Jim Simons' Renaissance Technologies is the biggest investor in our database as it owns 29.9 million shares that are worth $86.5 million.
Just like Teck Resources Limited (NYSE:TECK), Freeport-McMoRan Inc. (NYSE:FCX), and Agnico Eagle Mines Limited (NYSE:AEM), B2Gold Corp. (NYSE:BTG) is a minerals stock that hedge funds are piling into.
Royal Gold, Inc. (NASDAQ:RGLD) is an American company that owns interests in gold and other metal production in sites located all over the world. During the third quarter, it sold more than fifty thousand ounces of gold, silver, and other minerals.
Insider Monkey's third quarter of 2023 survey covering 910 hedge funds revealed that 23 had held a stake in the company. Royal Gold, Inc. (NASDAQ:RGLD)'s largest hedge fund shareholder is Jean-Marie Eveillard's First Eagle Investment Management due to its $385 million stake.
Alamos Gold Inc. (NYSE:AGI) is a Canadian gold mining company with operations in the U.S., Canada, and Mexico. The firm has beaten analyst EPS estimates in all four of its latest quarters, and in November 2023, Scotiabank upgraded its shares to Sector Outperform from Sector Perform.
As of September 2023, 23 out of the 910 hedge funds polled by Insider Monkey had invested in Alamos Gold Inc. (NYSE:AGI). Jean-Marie Eveillard's First Eagle Investment Management was the firm's biggest shareholder as it owned $107 million worth of shares.
BHP Group Limited (NYSE:BHP) is a global metals and mining giant with operations in Asia, Oceania, North America, and other regions. Like other mining giants, it is also investing in renewables and environmentally friendly operations and to this effect, BHP Group Limited (NYSE:BHP) announced a new battery energy facility for its Australian mines in November 2023.
Insider Monkey dug through 910 hedge fund holdings for their shareholdings during this year's September quarter and found that 25 had held a stake in the company. Ken Fisher's Fisher Asset Management is BHP Group Limited (NYSE:BHP)'s largest investor among these since it owns 19.3 million shares that are worth $1 billion.
Franco-Nevada Corporation (NYSE:FNV) is a gold royalty company headquartered in Toronto, Canada. The firm's copper mine in Panama has been facing disruption for quite a while now, with Franco-Nevada Corporation (NYSE:FNV) outlining in November that operations remain suspended.
By the end of this year's third quarter, 27 out of the 910 hedge funds profiled by Insider Monkey were Franco-Nevada Corporation (NYSE:FNV)'s investors. Jim Simons' Renaissance Technologies was the biggest shareholder courtesy of its $446 million investment.
Rio Tinto Group (NYSE:RIO) is another global mining giant. Its investors faced a minor setback in November when the company agreed to pay a $28 million fine to the SEC as part of a dispute that has seen allegations surface and claim that Rio Tinto Group (NYSE:RIO) misled investors about its multi billion dollar coal mine in Africa.
During 2023's September quarter, out of the 910 hedge funds tracked by Insider Monkey, 27 had bought the firm's shares. Rio Tinto Group (NYSE:RIO)'s largest hedge fund investor is Ken Fisher's Fisher Asset Management due to its $990 million stake.
Kinross Gold Corporation (NYSE:KGC) is a Canadian gold company headquartered in Toronto, Canada. The firm managed to keep its production stable in the third quarter, as not only did it grow output by 11%, but also asserted that it is on track to meet annual production guidance.
29 out of the 910 hedge funds part of Insider Monkey's Q3 2023 database had invested in Kinross Gold Corporation (NYSE:KGC). Jim Simons' Renaissance Technologies was the firm's biggest shareholder as it owned $128 million worth of shares.
Freeport-McMoRan Inc. (NYSE:FCX), Kinross Gold Corporation (NYSE:KGC), Teck Resources Limited (NYSE:TECK), and Agnico Eagle Mines Limited (NYSE:AEM) are some top hedge fund mineral stock picks.
