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Trading  | February 16, 2021

In this article, we mentioned the 12 Best Mining Stocks to Buy Now. If you’re in a hurry click to skip ahead to the 5 Best Mining Stocks to Buy Now. Enter your text here...

The mining industry involves the extraction of valuable metal and other geological materials in activities such as metal production, metal investing, and metal trading. The extracted materials are used to create a final product that benefits both a miner and a prospector. These extracted materials are viable to the construction of infrastructure that shapes our economy today. The industry can be classified into two main groups; senior and junior.

Senior mining companies are lower risk stocks that are identified as more experienced companies. These stocks usually pay dividends and offer capital appreciation. While junior mining companies are higher risk stocks that focus on the discovery of natural resources. Given their short history, they may lack a sufficient asset base to prove much worth in the market today. However, this also makes them an ideal investment for a great reward if the mining project is a success. Basically, a mining company will have to start as a junior before progressing to a senior.

The mining industry is one of the most valued industries shaping the world today. In 2006, the US mining industry produced $78.65 billion worth of shipments (excluding oil and gas). The number is not surprising with the obvious signs the industry offers our economy. The US is the world’s largest producers of coal, accounting for around 17% of the world population. According to Statista, the revenue of the top 40 mining companies globally amounted to some $692 billion in 2019.

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This new initiative is helping average Americans increase their chance of a long term market success in the middle of a global crisis. Handing some Americans gains such as 275% in one week on XLF, and 583%, in 7 days on XHB.

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The COVID-19 pandemic has left a mark on industries that required face to face operations. The mining industry was not immune to this. Mining companies were forced to shut down. In an article published by Mining Global report, the Platinum and Palladium prices dropped by more than 40% because of global social distancing measures. Despite this, IBISWorld expects the market size of the mining industry to increase 10.1% in 2021 due to the fluctuating demand.

The Biden Administration’s “Build Back Better” plans on spending $2 trillion on EV infrastructure and other green projects. Although this may affect the mining industry as a whole, the president mentioned that he has no plans on entirely eliminating the industry. On the contrary, his campaign supports boosting domestic production of metals used to make electric vehicles, solar panels, and other products crucial to his climate plan. In order to achieve this green energy transformation, raw materials are needed. Consequently, building back better involves miners to supply for the demand.

The risk in investing in these stocks has a vast range from the commodities prices to even the geographical location of the company you invest in. However, investors must keep in mind that natural resources are the backbone of all industries and the demand will keep increasing as long as there is growth in the economy. Investing in these stocks can offer great growth potential given its long history dating back 40,000 to 20,000 years ago when coal was first recorded. We also believe this is a great time to invest in hard assets and the companies involved in the production of these assets because of the unprecedented monetary and fiscal stimuli unleashed over the last 12 months. We believe inflation rate will surprise to the upside over the next couple of years.

In order to identify the 12 Best Mining Stocks to Buy Now, we started with the 23 holdings in the SPDR S&P Metals and Mining ETF as of February 5, 2021, and we were able to narrow down our list to 12 stocks by using the hedge fund sentiment data.

Our in-house analysis shows that we can use the sentiment information gathered from the hedge fund filings to classify in advance a select group of stocks that can beat the S&P 500 index by double digits annually on average. For instance, the portfolio of our monthly newsletter’s stock picks has beaten the market by over 111 percentage points since March 2017. Some of the portfolio holdings of our monthly newsletter have been shared publicly too. In October, we shared this real estate stock idea and since then, it’s been up more than 60 percent.

We now present to you the 12 Best Mining Stocks to Buy Now based on the stock picks of 800+ hedge funds tracked by Insider Monkey:

12. United States Steel Corporation (NYSE:X)

No of HFs: 21

Total Value of HF Holdings: $71.9 Million

X is ranked as the 12th best mining stock to buy now on our list. X shares currently trade at $16. At the end of September, 21 hedge funds tracked by Insider Monkey were long this stock. Boaz Weinstein's Saba Capital is one of the top hedge funds having positions in X, which had $94 million invested in stock at the end of September. An insider recently purchased 700 shares at around $13 in November 2019. The stock is up 23% since then. Recently the company announced the pricing of its upsized $750 million aggregate principal amount of 6.875% senior notes due 2021.

11. Arconic Corp. (NYSE:ARNC)

No of HFs: 21

Total Value of HF Holdings: $633 Million

At the end of September, a total of 21 hedge funds tracked by Insider Monkey were long this stock. Natixis Global Asset Management’s Harris Associates is one of the top hedge funds having positions in the stock, which had $79 million invested in the stock at the end of September. An insider recently purchased 2,900 shares at around $10 in May 2020. The stock is up 160% since then. ARNC was mentioned as one of Billionaire Paul Singer’s Top 10 Stock Picks. Recently, the company was named one of America’s Most Responsible Companies by Newsweek. The analysis is based on corporate social responsibility reports.

10. Cleveland-Cliffs Inc. (NYSE:CLF)

No of HFs: 22

Total Value of HF Holdings: $314 Million

CLF ranks 10th on our list of the best mining stocks to buy now. CLF shares currently trade at $17. At the end of September, a total of 22 hedge funds tracked by Insider Monkey were long this stock. One of the biggest hedge funds saving stakes in the company is Ken Fisher’s Fisher Asset Management which had $111 million invested in the stock at the end of September. An insider recently purchased 5,000 shares at around $4 in March 2020. The stock is up 325% since then. CLF was mentioned as one of the 10 Best Small-Cap Stocks to Buy Now. The company recently announced the proposed underwritten public offering of 60,000,000 common shares, par value $0.125 per share where they will grant the underwriters a 30-day option to purchase an additional 9,000,000 common shares.

9. Warrior Met Coal Inc. (NYSE:HCC)

No of HFs: 26

Total Value of HF Holdings: $199 Million

HCC ranks 9th on our list of the best mining stocks to buy now. At the end of September, a total of 26 hedge funds tracked by Insider Monkey were long this stock. One of the biggest hedge funds saving stakes in the company is Stephen Mildenhall's Contrarius Investment Management which had $38 million invested in the stock at the end of September. An insider recently purchased 1,200 shares at around $22 in August 2019. The stock is up 4% since then. HCC is a US-based supplier to the global steel industry. During the third quarter of 2020, the company reported total revenue of $180 million. HCC shares currently trade at $23.

8. Arch Resources (NYSE:ARCH)

No of HFs: 26

Total Value of HF Holdings: $211 Million

The 8th best mining stock to buy now is ARCH. At the end of September, a total of 26 hedge funds tracked by Insider Monkey were long this stock. An insider recently purchased 1,000 shares at around $30 in May 2020. The stock is up 73% since then. ARCH shares currently trade at $52. In 2020, the company named Rosemary L. Klein, as Senior Vice President - General Counsel and Corporate Secretary. Klein formerly held senior leadership roles in several multinational publicly held corporations such as Solutia Inc and Spartech Corporation.

7. Nucor Corporation (NYSE:NUE)

No of HFs: 28

Total Value of HF Holdings: $110 Million

At the end of September, a total of 28 hedge funds tracked by Insider Monkey were long this stock. One of the biggest hedge funds saving stakes in the company is D.E. Shaw’s DE Shaw which had $28 million invested in the stock at the end of September. NYSE shares currently trade at $53. NUE recently announced its plans of building a $1.7 billion steel plate manufacturing mill with target operations to start by 2022. During the third quarter of 2020, the company reported earnings of $193.4 million.


6. Steel Dynamics, Inc. (NASDAQ:STLD)

No of HFs: 28

Total Value of HF Holdings: $459 Million

One of the biggest hedge funds saving stakes in the company is D.E. Shaw’s DE Shaw which had $115 million invested in the stock at the end of September. An insider recently purchased 6,000 shares at around $20 in March 2020. The stock is up 90% since then. STLD shares currently trade at $38. The company was recently named as one of the 2021 World’s Most Admired Companies by Fortune. The company ranked No. 1 within the metals industry.

5. Reliance Steel and Aluminum Co. (NYSE:RS)

No of HFs: 30

Total Value of HF Holdings: $267 Million

The metal solutions provider, RS is the 5th best mining stock to buy now. RS shares currently trade at $124. At the end of September, a total of 30 hedge funds tracked by Insider Monkey were long this stock. One of the biggest hedge funds saving stakes in the company is Royce and Associates which had $52 million invested in the stock at the end of September. They recently entered into an amended and restated $1.5 billion credit facility. The facility includes an increase option for up to an additional $1.0 billion and allows for prepayments.

4. Royal Gold, Inc. (NASDAQ:RGLD)

No of HFs: 30

Total Value of HF Holdings: $352 Million

RGLD was mentioned as one of the 20 Best Gold Stocks to Buy Now According to Billionaire Hedge Fund and is ranked as the 4th best mining stock to buy now. One of the biggest hedge funds saving stakes in the company is Jean-Marie Eveillard’s First Eagle Investment Management which had $303 million invested in the stock at the end of September. During the third quarter of 2020, the company reported a net income of $38.6 million or $0.59 per share.

3. Alcoa Corporation (NYSE:AA)

No of HFs: 33

Total Value of HF Holdings: $415 Million

AA is the 3rd best mining stock to buy now.  One of the biggest hedge funds saving stakes in the company is Ken Fisher’s Fisher Asset Management which had $77 million invested in the stock at the end of September. An insider purchased 400 shares at around $17 in January 2021. The stock is up 23% since then. AA was mentioned as one of the 10 Biggest Companies That Were Dropped From the Dow Jones Industrial Average (DJIA). The company conducts operations in 10 countries.

2. Newmont Corporation (NYSE:NEM)

No of HFs: 55

Total Value of HF Holdings: $1.95 Billion

The Colorado-based mining company has the largest gold reserve base in the industry. NEM shares currently trade at $60. One of the biggest hedge funds saving stakes in the company is Jean-Marie Eveillard’s First Eagle Investment Management which had $1.23 billion invested in the stock at the end of September. First Eagle Investment Management mentioned NEM in its Q2 2020 investor letter:

“Given what we view as a high-quality management team and robust balance sheet, Colorado’s Newmont is a prime example of a miner that was prepared to meet the challenges of Covid19. With rigorous protocols already in place, the company has been proactive in managing its mines to protect local communities and infrastructure while at the same time mitigating the pandemic’s impact on its business. In contrast with broad market trends that have companies cutting or suspending dividend payments, Newmont recently increased its quarterly dividend by 79%.”

1. Freeport-Mcmoran, Inc. (NYSE:FCX)

No of HFs: 57

Total Value of HF Holdings: $1.57 Billion

The best mining stock to buy now is FCX. The company operates large, geographically diverse assets with significant reserves of copper, gold, cobalt, oil, and gas. FCX shares currently trade at $32. One of the biggest hedge funds saving stakes in the company is Ken Fisher’s Fisher Asset Management which had $632 million invested in the stock at the end of September. An insider recently purchased 85,000 shares at around $10 in March 2020. The stock is up 220% since then. In 2020, the company completed a sale of $650 million aggregate principal amount of its 4.375% senior notes due 2028 and $850 million aggregate principal amount of its 4.625% senior notes due 2030. During the third quarter of 2020, the company reported revenue of $3.85 billion.


18 MONTHS OR MORE OF UNPRECEDENTED OPPORTUNITY

A revolutionary initiative is helping average Americans find quick and lasting stock market success.

275% in one week on XLF - an index fund for the financial sector. Even 583%, in 7 days on XHB… an ETF of homebuilding companies in the S&P 500. 



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