Tag: SBSW

Forget Gold and Silver: The Growth Potential of Platinum and Palladium

by Fred Fuld III

Platinum and palladium, members of the platinum group metals (PGMs), are renowned for their unique properties, including resistance to corrosion, high melting points, and exceptional catalytic capabilities. These characteristics make them indispensable across various industries:

  • Automotive Industry: Both metals are crucial components in catalytic converters, which reduce harmful emissions from vehicles.
  • Jewelry: Their lustrous appearance and durability make them popular choices for high-end jewelry.
  • Electronics: Utilized in the manufacturing of hard drives, fuel cells, and other advanced electronic devices.
  • Medical Devices: Employed in pacemakers and dental instruments due to their biocompatibility.
  • Green Energy: Essential in hydrogen fuel cells, supporting the transition to cleaner energy sources.

As global industries strive for sustainability and stricter emission standards, the demand for PGMs is poised to grow, presenting potential opportunities for investors.

Top Platinum and Palladium Stocks to Consider

1. Anglo American Platinum (ANGPY)

Anglo American Platinum stands as the world’s leading primary producer of platinum, operating extensively in South Africa. The company supplies PGMs to various sectors, including automotive and industrial markets.

  • Market Capitalization: Approximately $8.36 billion.
  • Price-to-Earnings (P/E) Ratio: 13.38.
  • Dividend Yield: Forward dividend yield stands at 20.73%, with a total yield of 3.43%. Morningstar

Anglo American Platinum’s robust financial metrics and commitment to sustainable practices make it a compelling option for investors seeking exposure to the PGM sector.

2. Impala Platinum Holdings (IMPUY)

Impala Platinum Holdings, commonly known as Implats, is a significant player in the PGM mining industry, with operations spanning South Africa, Zimbabwe, and Canada.

  • Market Capitalization: Approximately $4.63 billion.
  • Price-to-Earnings (P/E) Ratio: -0.26, indicating a net loss over the trailing twelve months.
  • Dividend Yield: 5.96%. Investing

Despite recent financial challenges, as reflected in its negative P/E ratio, Implats continues to be a major producer in the PGM market, offering a substantial dividend yield to its shareholders.

3. Sibanye Stillwater Limited (SBSW)

Sibanye Stillwater is a diversified mining company with a strong presence in both South Africa and the United States, particularly noted for its operations in Montana.

  • Market Capitalization: Approximately $2.29 billion.
  • Price-to-Earnings (P/E) Ratio: -0.78, indicating a net loss over the trailing twelve months.

The company’s diversification into battery metals aligns with the growing demand for green energy solutions, positioning it well for future growth.

4. Platinum Group Metals Ltd. (PLG)

Platinum Group Metals Ltd. focuses on the exploration and development of platinum and palladium resources, primarily in South Africa.

  • Market Capitalization: Specific market capitalization details are not available from the provided sources.
  • Price-to-Earnings (P/E) Ratio: Specific P/E ratio details are not available from the provided sources.
  • Dividend Information: The company does not currently pay a dividend.

As a development-stage company, Platinum Group Metals Ltd. presents a higher risk but also offers potential for significant returns, especially with its flagship Waterberg Project, which could become one of the largest undeveloped PGM deposits globally. This is an extremely low cap company and should be considered very speculative.

Conclusion

The unique properties and diverse applications of platinum and palladium position them as critical materials in various industries, from automotive to green energy. Companies like Anglo American Platinum, Impala Platinum Holdings, Sibanye Stillwater, and Platinum Group Metals Ltd. offer distinct opportunities for investors looking to capitalize on the potential growth in the PGM sector. As always, potential investors should conduct thorough research and consider their risk tolerance before making investment decisions.

Disclosure: Author didn’t own any of the above at the time the article was written.

Top Inflation Hedge Gold Mining Stocks

by Fred Fuld III

It was just back in September when I wrote the article Top Gold Mining Stocks, almost six months to the day. In the article, I listed seven gold mining companies. The following shows the returns for those stocks.

Stock Symbol 9/13/22 3/10/22 Gain/Loss
AngloGold Ashanti Limited AU 15.5 25.73 66%
Caledonia Mining Corporation Plc CMCL 12.36 13.49 9%
DRDGOLD Limited DRD 9.15 10.14 11%
Gold Fields Limited GFI 8.64 16.69 93%
Harmony Gold Mining Company HMY 3.28 5.41 65%
Kinross Gold Corporation KGC 5.75 5.66 -2%
Sibanye Stillwater Limited SBSW 13.61 18.32 35%
AVERAGE 40%

As you can see, there was only one loser in the bunch, Kinross Gold (KGC) which was down 2%. However, all the others were up substantially. One, Gold Fields (GFT), almost doubled. The overall average return was 40%; not too shabby for a six month period.

Gold an Inflation Hedge & Recession Hedge?

Some studies have shown that gold may not track inflation during short time frames, but over long periods of time, gold has been considered an inflation hedge and a hedge against a downturn in the economy.

According to the U.S. Bureau of Labor Statistics, “gold prices can act as an indicator of the health of the economy. A rise in the price of gold may be a signal that the economy is struggling. As a result, in times of either a crisis or inflation, many investors turn to gold to protect their principal. By contrast, in times of economic stability, investors are more likely to turn to more speculative investments, such as stocks, bonds, and real estate. During these times, the price for gold often declines.”

(What is surprising about this statement is that stocks, bonds, and real estate are considered “speculative investments”. Does that make gold a “safe investment”?)

Top Gold Mining Stocks

So now that gold has started to move up, and recently broke the $2000 an ounce price barrier, what gold mining stocks have solid ratios now.

There are currently four gold mining companies that have trailing price to earnings ratios of less than 25, forward price to earnings ratios of less than 25, and yields above 2%. You will notice that only one stock from the old list, Agnico, made the cut for the new list.

Agnico Eagle Mines Limited (AEM)

Agnico Eagle is a Canadian based mining company with mines in Canada, Sweden, and Finland. The stock has a trailing P/E ratio of 23.3, a forward P/E ratio of 24.33, and pays a yield of 2.28%. Annual earnings per share growth for the last five years is 79%.

AngloGold Ashanti Limited (AU)

AngloGold, based in Johannesburg, South Africa, has mines in Africa, North America, South America, and Australia. The stock trades at 16.9 times trailing earnings and 12 times forward earnings. The dividend payout rate is 2.11%. Annual earnings per share growth for the last five years is 97%.

B2Gold Corp. (BTG)

The Canada based company, B2Gold, has three operating mines in Mali, the Philippines, and Namibia. The stock has a very favorable P/E ratio of 10.7 and forward P/E of 10.4. Even the price to earnings growth ratio is a commendable 0.53. Annual earnings per share growth for the last five years is 33%.

Sibanye Stillwater Limited (SBSW)

Sibanye is a South African company that has mines in South Africa, the United States, Zimbabwe, Canada, and Argentina. The stock has an excellent price to earnings ratio of 6.2, with a forward P/E of 12.2. Annual earnings per share growth for the last five years is 41%.

Maybe one of these mining stocks can provide your portfolio with a pot of gold.

Disclosure: Author owns BTG

Top Gold Mining Stocks

by Fred Fuld III

Why invest in gold?

It may have bottomed out on a short term basis.

Inflation is on the horizon.

Provides diversification by asset type.

It provides protection against a falling dollar.

It is used in the tech industry.

What are some the the best gold mining stocks?

All of the following stocks have a trailing price to earnings ratio of less than 15, a forward P/E ratio of less than 15, and pay a dividend with a yield of at least 2%.

AngloGold Ashanti Limited AU
Caledonia Mining Corporation Plc CMCL
DRDGOLD Limited DRD
Gold Fields Limited GFI
Harmony Gold Mining Company HMY
Kinross Gold Corporation KGC
Sibanye Stillwater Limited SBSW

Caledonia is based in the United States, Kinross is based in Canada, and the rest are based in South Africa.

Hopefully, one of these gold mining stocks will make your portfolio shine.

 

Disclosure: Author didn’t own any of the above at the time the article was written.