Of the metals most hotly debated among traders on the TSX index, gold, uranium, palladium, copper, and lithium are among the hottest. While silver, cobalt, and various other base metals are also of great interest, the following mining assets represent some of the best pure-play investments available right now.
Covering indirect exposure to energy, tech, electric vehicles, and even Brexit, let’s see which metals stocks made the list.
Uranium remains one of the leading assets on the flip-side of fossil fuel-based energy production. Down 1.25% in the last five days, Cameco presents a slight value opportunity. It’s seen significant inside buying over the last three months and has a range of solid stats.
In terms of health, Cameco’s balance sheet is typified by debt at 30% of net worth, which is within the safety zone, and is well-covered. Value is indicated by a P/E of 37.6 times earnings and decent P/B of 1.3 times book.
Long-term investors may be interested to see a small dividend yield of 0.51% on offer, though a 17.9% expected annual growth in earnings may not satisfy the high-growth investor.
Lithium Americas (TSX:LAC)(NYSE:LAC)
Down 12.75% in the last five days, lithium bears may feel vindicated at the moment, though with a projected 36.9% expected annual growth in earnings on the way, Lithium America’s isn’t going anywhere anytime soon.
While its one-year past earnings growth of 15% does its best to make up for a negative five-year average past earnings growth rate, a clean balance sheet is characterized by debt at 22.6% of net worth, while a P/B of 4.3 times book shows borderline overvaluation.
Lundin Mining (TSX:LUN)
If copper is your metal of choice, you may want to invest in a stock like Lundin Mining, with its main focus on copper, nickel and zinc. Up 15.27% over the last five days, shareholders might feel like shorting right now, while wish-listers should probably hold out.
A healthy enough stock, Lundin Mining boasts a five-year average past earnings growth of 21.6% and negligible debt at 0.3% of net worth. Meanwhile, decent value is indicated by a P/E of 21.5 times earnings and P/B of 1.1 times book.
North American Palladium (TSX:PDL)
Down 3.92% in the last five days, metals investors have a slight value opportunity here. Healthy returns of 11.6% outperformed the Canadian metals and mining industry average for the last 12 months, while a one-year past earnings growth of 230.2% and five-year average past earnings growth of 45.6% indicate a solid stock.
North American Palladium’s past-year ROE of 22% put this stock in the lead when it comes to overall quality and robustness, while a healthy balance sheet, good value (see a P/E of 5.9 times earnings and P/B of 1.3 times book) plus a small dividend yield of 1% make this stock a buy.
Down 6.24% in the last five days, one might be forgiven for assuming that gold bulls were sleeping on mining stocks. Indeed, the last three months saw an insider sell-off of Goldcorp shares. However, a small dividend yield of 0.74%, and most of all a considerable 130.3% expected annual growth in earnings make this stock a solid buy.
The bottom line
Lundin Mining’s dividend yield of 1.55% and 23.6% expected annual growth in earnings make it the right stock for copper bulls, while North American Palladium’s 4.2% expected annual growth in earnings might disappoint growth investors.
Goldcorp is a high value, high growth stock, meanwhile, with a 32% discount and P/B of 0.9 times book making it just right for a gold bull.
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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Victoria Hetherington has no position in any of the stocks mentioned.