May 8, 2021 6 min read
This story originally appeared on StockMarket
Is it worth investing in these top copper mining stocks now?
When looking for good stocks to invest in In the stock market, investors may want to consider copper mining stocks. Why? For starters, copper is one of the most versatile metals in the world, if not one of the most versatile. Whether in the construction, electronics or even the automotive industry – copper is an important component. In particular, the demand for metal could continue to rise thanks to growing global green initiatives. According to the International Copper Association, the electric vehicle and renewable energy industries use much more copper compared to their non-green predecessors. In particular, these industries use more than four to five times that of copper. All of this in turn could spark the interest of organizations and investors in copper.
Given the current momentum in copper, I could understand if investors are watching the precious metal now. For investors choosing between stocks and commodities, copper mining stocks could also offer a good middle ground. Additionally, Bank of America (NYSE: BAC) commodities strategist Michael Widmer appears to be interested in the long-term growth potential of copper. Widmer argues that dwindling copper supplies could push the price per ton of copper to $ 20,000 by 2025. If so, the price of copper could more than double over the next four years. Of course, copper prices recently hit the $ 10,000 per ton mark after a decade.
As a result, I wouldn’t be surprised if investors look to the top copper mining stocks right now. Important players in the copper industry such as the BHP Group (NYSE: BHP) and Glencore (OTCMKTS: GLNCY) have already increased by over 90% in the past year. Could one of those stock exchange copper games be your next big investment?
The Best Copper Mining Stocks to See in May
Rio Tinto plc
Rio Tinto is a multinational and one of the world’s largest metals and mining companies. It produces iron ore, copper, diamonds, gold and uranium. As well as focusing on the extraction of materials, the company is also engaged in refining. The company operates in 35 countries around the world and plays a key role in the copper industry. RIO stock is currently trading at $ 93.17 at Friday’s closing price and has doubled over the past year.
In February, the company reported its financial data for full year 2020. Rio Tinto had weathered the pandemic and appears to be recovering strongly. First, the company’s cash flow from operating activities was $ 15.87 billion, up 6% year over year.
Second, net income was $ 9.76 billion, up 22% over the previous year. Given the resilience of its business coupled with strong commodity prices, the company managed to deliver a commendable quarter. All in all, will you consider buying RIO stock?
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Southern Copper Corporation
Southern Copper is one of the largest integrated copper producers in the world. The mining operations are located in Peru and Mexico, while exploration activities are also taking place in these countries and in Chile. The company uses state-of-the-art mining and processing methods, including a global positioning system and computer-aided mining operations. SCCO stock is currently trading at $ 76.87 on Friday at 4:00 p.m. ET and is up over 110% over the past year. Last week the company released its financial data for the first quarter of 2021.
Net sales for the quarter were $ 2.53 billion, up 47.3% year over year. The growth was mainly due to significantly higher metal prices for copper, silver and zinc. Net income for the quarter was $ 763.8 million, an astonishing 255.6% year-over-year increase.
The company has also invested heavily in expanding its business. For the quarter, $ 232.6 million was spent on capital investments, an increase of 130.3% year over year. Southern Copper also announced a dividend of $ 0.70 per share. With that in mind, will you consider SCCO stock to be one of the best copper mining stocks to buy?
Newmont is the world’s largest gold mining company. In addition to gold, the company also mines copper, silver, zinc and lead. The company employs over 31,600 people and contractors worldwide and is the only gold company in the S&P 500. NEM shares closed the trading session on Friday at $ 67.33 per share and has traded sideways since the start of the year. Could this be an opportunity for investors to buy NEM shares amid the surge in copper prices? Last week the company delivered solid financials for the first quarter and is on track to meet its full year guidance.
For the quarter, the company produced 1.5 million attributable ounces of gold and 317,000 attributable ounces of gold equivalents from by-products. Additionally, adjusted net income for the quarter was $ 594 million, an increase of 82.2% year over year. What was impressive was that the quarter ended with a consolidated cash flow of $ 5.5 billion.
Newmont’s capital efficient project pipeline helps improve production, reduce costs and extend the life of the mine. Funding for the current Tanami Expansion 2 development capital project has been approved and the project is in the execution phase. Given these developments, will you consider buying NEM shares?
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At the top of our list today is Freeport-McMoRan Inc. (Freeport). In short, the Arizona-based company is a leading name in the international mining industry. Freeport primarily operates large and long-lived geographically diverse assets with reserves of copper, gold and molybdenum.
For scalability reasons, the company’s portfolio includes the Grasberg mineral district in Indonesia, one of the largest copper and gold deposits in the world. In addition, Freeport has significant mining operations across America. For sure, Freeport is no newbie when it comes to copper. In fact, the FCX share is currently posting gains of over 370% over the past year. Could it be worth investing in now?
Well, we could take a look at the company’s final quarter, released in late April. In it, Freeport published outstanding figures across the board. The company in particular recorded a massive year-over-year increase in sales of 73% and earnings per share of 245%. Additionally, Freeport saw its cash on hand increase 185% year over year to $ 4.58 billion. CEO Richard Adkerson cited the solid operational execution of the global Freeport team as a key growth driver for the quarter. Given the company’s strong cash position and current momentum, would you consider FCX stock a buy?