We recently published a list of 7 Best Zinc Stocks to Buy According to Hedge Funds. In this article, we are going to take a look at where Hudbay Minerals Inc. (NYSE:HBM) stands against other best zinc stocks to buy according to hedge funds.
Zinc is a vital part of modern industry and plays a major role in galvanizing steel to produce alloys and promote sustainable energy storage. Construction, automotive, healthcare, and even dietary supplements are among its many uses.
Zinc’s importance is on the rise with a renewed focus on sustainable manufacturing, an increasing number of electric vehicles (EVs), and the growth of infrastructure projects. The Business Research Company has reported that the global zinc market will develop significantly. It is expected to rise from $28.82 billion in 2024 to $41.76 billion by 2029, with an annual growth rate of 7.6%.
The market trend further highlights zinc’s upward surge. Over the previous year, zinc futures have risen by 19.63%, increasing from $2,405 per metric ton on February 18, 2024, to $2,877 on February 19, 2025. Refined market fundamentals and investor trust have driven this expansion. In 2024, zinc production stood at 20 million tons, while its consumption stayed consistent at 19 million tons. China, Peru, and India continue to be the lead producers of the metal. However, global trade patterns have shifted, leading to an 11% drop in zinc imports, bringing it down to 4.2 million tons. After continuous growth of two years, exports also showed a decline of 8.5%, down to 4.6 million tons. This decline was mainly caused by a deceleration in the EV market, as vehicle manufacturers started experimenting with other materials. Furthermore, the shift to green energy momentarily disrupted conventional supply chains, leading to variations in zinc trade.
Regardless, zinc demand remains steady in the main industrial sectors. The U.S. and China held their position as the lead importers of the metal during the year. In 2024, it was reported that the USA imported almost 589,000 tons of zinc, making up 14% of total imports, while China imported 441,000 tons, contributing to 11% of total imports. This shows how zinc still plays a key role in infrastructure, the automotive sector, and technology advancements.
As the globe transitions to a low-carbon economy, zinc is becoming a vital facilitator of decarbonization with coatings alone, accounting for 60% of global zinc consumption. The International Zinc Association (IZA) forecasts a 22% increase in zinc demand from the automotive sector, which amounts to an additional 140,000 tons by 2030. This expansion is fueled by the increasing automobile sales in China and India, the surging preference for larger vehicles, and the increased utilization of galvanized steel in electric vehicle manufacturing.
Beyond the automotive industry, zinc’s demand is also increasing in renewable energy. According to Zinc.org, by 2030, solar power infrastructure will require approximately 568,000 tons of zinc, as zinc-coated steel becomes essential in solar arrays and wind turbines. Meanwhile, zinc is increasingly influential in agriculture due to the Zinc Nutrient Initiative (a program with the aim to add zinc fertilizer to soils to significantly increase crop yield, and boost nutritional value in humans), which has created an annual need of 400,000 tons for fertilizers. Moreover, the increasing popularity of zinc-based dietary supplements is boosting market demand.
In parallel, technological progress in zinc recovery and recycling is moving the industry toward sustainability. Innovations in direct leaching and submerged lance technology are improving extraction efficiency while minimizing environmental impact. A significant advancement, named Kobe Steel’s FASTMET process, has achieved a remarkable 95% recovery rate of zinc from steel mill waste and industrial by-products. These innovations are transforming waste into recyclable resources, fostering a circular economy that encourages zinc’s sustainability in the long run.
As the industry progressively emphasizes sustainability, zinc’s significance in infrastructure, energy, and agriculture continues to grow, offering profitable prospects for investors.
Methodology
To compile our list of the 7 Best Zinc Stocks to Buy According to Hedge Funds, we first conducted extensive research to identify companies with significant exposure to the zinc industry. We define exposure in terms of zinc mining, refining, or the production of zinc-based products.
We then extracted the number of hedge fund holders having a stake in the respective companies, as of Q4 2024, using data from Insider Monkey’s hedge fund database. The finalists are stocks with the highest hedge fund interest.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Is Hudbay Minerals Inc. (HBM) i the Best Zinc Stock to Buy According to Hedge Funds?
An aerial view of a copper mine, showing the intricate workings of heavy machinery.
Hudbay Minerals Inc. (NYSE:HBM) is a key mining company that has operations spread across North and South America, focusing on the production of copper, gold, and zinc. The company’s main assets include the 777 zinc-copper-gold-silver mine in Canada and the Constancia copper mine in Peru. These two mines demonstrate Hudbay’s presence in the base metals industry.
For the fiscal year ending December 31, 2024, Hudbay Minerals Inc. (NYSE:HBM) reported a record annual revenue of $2.02 billion, a 19.6% increase from the previous year. This growth was driven by higher copper sales and appreciating gold prices. Attributable net income increased by 15.5% to $76.7 million, reflecting stronger cash flow and operational efficiencies. Adjusted EBITDA reached a record $822.5 million, maintaining a robust margin.
On the other hand, Q4 2024 also faced significant obstacles as revenue declined by 2.87% to $584.9 million, and attributable net income decreased by 30.9% to $21.2 million. These reductions were mainly due to lower grades and heightened production expenses, though zinc production still helped sustain cash flow.
Looking ahead, Hudbay Minerals Inc. (NYSE:HBM) anticipates a 28% reduction in zinc production in 2025, with a projected output of 24,000 tons. This anticipated drop is linked to the extraction of lower-grade base metals at the Lalor mine in accordance with the company’s strategic mine plan.
To address future production stability, a preliminary economic analysis on the reprocessing of zinc plant tailings has confirmed the technical feasibility of an alternative. This project has resulted in additional engineering efforts intended to boost long-term zinc output and mitigate expected reductions. With a strong financial position and strategic investments, Hudbay Minerals Inc. (NYSE:HBM) remains a key investment in the zinc market.
Overall, HBM ranks 4th on our list of best zinc stocks to buy according to hedge funds. While we acknowledge the potential of HBM as an investment, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than HBM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
