By Pulane Choane
Media conglomerate Bloomberg earlier this week reported that the ongoing Russia-Ukraine geopolitical tensions have amplified mining stocks in precious metals, especially gold, with this particular commodity reportedly doing the best on the market.
This comes as the latest sanctions against Russia from America and the West prompted Vladimir Putin’s central bank to resume purchases of the precious metal placed on ice for nearly two years during the COVID 19 pandemic.
The financial news outlet further reports that March 2022 has been gold’s best performing month since May. This although gold prices fell by more than 1% this week following news that there may be peace talks between Russia and Ukraine.
Talks between the currently two conflicted countries essentially mean that if there is peace between them, there will be less demand for precious metals, thereby dropping the price of gold.
However, if no peace agreement is reached, the price of gold and other precious metals such as palladium will rise sharply, as there will be a higher demand, thereby raising the stock prices for these.
Meanwhile, CNBC reports that Phillip Streible, the Chief Market Strategist at Blue Line Features, a financial broker in Chicago, says that if these talks fall through, gold can expect to be anchored at $1,950 per ounce.
Considering the opportunities present for investors, particularly in mining stocks, the rest of this article will provide a shortlist of the top mining stocks to watch out for and invest in right now, given the ongoing world market turmoil.
Given the mining industry’s cyclical nature, it is best to look for mining stocks from reputable mining companies that offer investors profits regardless of market conditions. It can show consistent growth over 12 months.
Here’s our list of the five best mining stocks to invest in during Russia-Ukraine saga:
5. Barrack Gold Corp (NYSE: GOLD) With its headquarters in Canada and over a dozen mining operations worldwide, including in countries such as the Dominican Republic and Chile, this company is one of the globe’s largest gold miners. While the company took a beating with the COVID19 pandemic before the crisis, it had reported higher than expected earnings for four years. Last year, however, its revenue expectations declined by 5.3%, from $3 30 billion to $2.89 billion.
Despite this, Barrack Gold remains an excellent company to buy mining stocks in, as it reported a 15% growth in its net income, which came in at over $411 million and earnings per share last year, which now stand at $0, 23 per share. Analysts predict this company’s stocks to increase over the next year, making it a good mining stock to keep an eye on.
4. Freeport-McMoran Inc (NYSE: FCX)
Founded in the late 1980s, this mining company is one of the largest globally, as it has a market cap of over $47 billion. The company focuses its mining efforts on gold, copper and molybdenum, a hard alloy metal commonly found in tools, heating elements and other items every day in the tools industry. This is a terrific company to watch because of its diversified interests in these three metals that it specializes in.
Furthermore, the company is among the few globally that recovered its losses from the COVID19 pandemic in 2020 and 2021. Standing at a whopping $5.75 billion, the company has increased its revenue by over 88% in the quarter 2 of this year, in contrast to the same period last year. It also raised its earnings per share to shareholders by 2.3% and grew its income by 1.94%, from $1.05 billion to $1.08 billion.
3. Wheaton Precious Metals Corp (NYSE: WPM)
This company, founded in 2004, is today one of the world’s largest silver streaming companies. With a market cap of close to $18 million, the company produces its iron ore from its mines but has more silver from its streaming agreements than its mines. The mine operates on a model that provides cash upfront for smaller mines that are still developing and struggle with daily operations.
This deposit is in exchange for a discount from these mines to the Wheaton Precious Metals Corp when it purchases the silver produced by these mines. The mining complex currently has close to 30 mining streams.
In the second quarter of 2022, it has grown over $330 million in revenue and increased its share per earnings by 57% and its net income compared to last year during this quarter by over 60%. As it stands, the mining giant enjoys a net gain of over $166 million.
These impressive numbers prove that it is a company that both employs a model that works for it and works for the smaller mines it provides funding to. It is thereby contributing to the overall growth of the mining industry, making it a prime contender to be on the lookout for when investing in mining stocks, particularly silver.
2. Rio Tinto (OTC: RTNTF)
An Anglo-Australian multinational mining company with its fingers in the iron ore, copper, lithium, diamond, uranium and gold pies, Rio Tinto is the second-largest mining company globally.
Unlike other mining companies previously stated on this list, this corporation operates in the over-the-counter (OTC) market, which denotes that it doesn’t trade its stocks on a major stock exchange like the New York Stock Exchange, owing to the risks that come with investing in it. However, unlike many mining companies in this category, many of which are penny stocks, Rio Tinto boasts a market capitalization of nearly $115 million.
The mining complex also vaunts a stellar reputation in the mining industry for being among the companies that can deliver year on year above expected growth, with its revenues for the second quarter of 2022 being up by almost 71% and sitting at over $16 billion.
It is also reported that the company showed a staggering 271% growth in its net income numbers, which also translated into greater earnings per share, with a registered $3.78 per share, which is again a growth of over 270% from last year during the same period.
This exceptional company features mainly as a mining stock to watch because, with electric cars, which use lithium batteries, booming, it is likely that there will be a shortage of lithium in the future, which will cause this company’s mining stocks to increase to windfall levels in the coming future.
1.Newmont Corporation (NYSE: NEM)
Given the likelihood of the scarcity of gold in the coming months owing to the Russian-Ukrainian conflict, this company’s gold mining stocks may, in the upcoming quarters, rise substantially as gold becomes less in demand, thereby raising its price substantially.
The organization, headquartered in Denver, Colorado, is the largest gold mining company globally. It is also a manufacturer of silver, zinc, copper and lead, which are also high demand metals. While the company’s stock price is now lower than in some recent months over the last year, analysts predict that the company will help this year recover that loss.
This is anticipated to be with an increase in the stock price as gold becomes less in demand, thereby making it more expensive.
Meanwhile, the mining company performed well as it reported an over 88% increase in its earnings per share ratings, with these now sitting at $0.81 per share. The company, formed in 1921, also reported a 30% revenue increase from last quarter and sat at over $3 billion in revenue.