Investing in the mining industry is always an excellent way to gain exposure to the commodities segment. Moreover, as the economy grows, demand for minerals and metals will increase, generating profits for investors.
However, for this strategy to succeed, choosing companies with strong financials and long-term growth prospects is essential. Here are two of my favourite TSX mining stocks for October 2023, which investors can consider buying.
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Lithium Americas
Lithium Americas (TSX: LAC) is a Vancouver-based resource company which operates in Argentina and the United States. It explores lithium deposits and has interests in several ventures like the Cauchari-Olaroz project, Thacker Pass project, etc.
Recently, this company announced it is in talks with the U.S. Department of Energy to get a US$1 billion loan for its Nevada Project. This mine has the potential to be North America’s largest lithium reserve and serve as a reliable source for making electric vehicle batteries. It will also help the country reduce its dependence on Chinese imports.
Apart from this, the company’s Caucharí-Olaroz project in Argentina has successfully produced lower-than-battery-quality lithium carbonate. This is the first step towards creating battery-grade lithium carbonate, which can bring significant growth prospects to Lithium Americas in the time to come.
Agnico Eagle
Agnico Eagle (TSX: AEM) is a Canadian organization involved in the mining, exploration, production and development of gold and other precious metals. Apart from its home country, it has mines in Australia, Mexico and Finland. This company also has development and exploration activities in North America, Europe, and Australia.
The company’s recent second-quarter (Q2) 2023 results were strong, with Angico Eagle bringing in impressive top- and bottom-line numbers. The company’s revenues increased by 8.7% from last year’s same quarter, with figures reaching US$1.72 billion.
Apart from this, its payable gold production increased from Q2 2022’s 858,170 ounces to this year’s 873,204 ounces. Its total cash costs/ounce also reached US$840, surpassing last year’s figures of US$726.
Furthermore, this company’s stock price appreciated 32.2% over the past year compared to the industry growth of 29.7%. For the previous quarter, it declared a dividend payment worth $0.53 per share. This amounts to a dividend yield of 3.55%, which is slightly higher than the sector average of 1.88%.
Bottom line
Given their current projects and financials, both stocks have strong long-term growth potential. Thus, investors desiring to gain exposure to the commodities sector can consider purchasing these stocks.
