Mining Momentum: 2 TSX Stocks That Could Surprise Investors This January

Mining stocks could kick off 2026 with another surprise run as rate-cut hopes meet tight commodity supply.

Key Points
  • Mining stocks can jump in January if investors expect lower rates and stronger commodity demand.
  • Lundin Mining can swing sharply with metal prices, and Q3 2025 showed solid cash-generating power.
  • Labrador Iron Ore Royalty can pay big dividends in strong iron ore markets, but payouts can be volatile.

Mining stocks can keep momentum into January 2026 for a pretty simple reason. These sit at the crossroads of the real-world economy and investor psychology. When markets start sniffing out lower interest rates, money often rotates toward areas that were held back by high rates, higher discounting, and recession worries. At the same time, many mined commodities have supply constraints that don’t fix themselves quickly, as it takes years to permit, build, and expand a mine. Put those together and you can get a January where miners surprise investors even after a strong prior year. Not because they’re safe, but because they’re leveraged to improving sentiment, improving demand expectations, and still-tight supply.

A worker wears a hard hat outside a mining operation.

Source: Getty Images

LUN

Lundin Mining (TSX: LUN) is the kind of name that can still surprise because it’s a working miner with meaningful operational leverage. If metal prices hold up or improve, the cash flow can quickly rebound; and if prices soften, the same leverage works in reverse. What matters for new investors is that Lundin’s Q3 2025 results show it’s still generating real earnings power in the current environment, not just promising it. In the company’s MD&A, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for the quarter was about $489.7 million, with adjusted earnings around $152.3 million.

Income is the part that beginners often misunderstand with miners. Lundin does pay a dividend, but it’s typically not the main reason to own it, and it won’t behave like a classic Canadian dividend stalwart. For example, Lundin declared a quarterly dividend of $0.09 per share around its Q3 2025 reporting, alongside net sales of about $1.1 billion and adjusted EBITDA of about $429.5 million. The key takeaway is that the dividend exists, but the real engine is the cycle.

LIF

Labrador Iron Ore Royalty (TSX: LIF) is a different kind of mining exposure, and it can absolutely surprise investors, but for a different reason. You’re not buying a miner that has to constantly fund big expansions. You’re buying a royalty-style cash flow stream tied to iron ore economics, which can translate into chunky dividends when iron ore pricing and shipments are strong.

If you’re thinking about January 2026 specifically, LIF’s surprise potential usually comes from the market underestimating how long a strong iron ore environment can last, or from dividend expectations resetting higher when results come in better than feared. But you have to hold two truths at once. This can be a high-income name in good times, and it can also be as volatile as the commodity.

Bottom line

Lundin’s surprise factor is operational and cyclical leverage in a diversified base-metals miner, whereby a better tape and decent pricing can unlock outsized upside. Labrador’s surprise factor is the dividend and cash-flow torque you can get from an iron ore royalty-style structure when the commodity stays stronger than expected. Together, here’s how much $7,000 could bring in for both mining stocks in dividends alone.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDEND TOTAL ANNUALPAYOUTFREQUENCYTOTAL INVESTMENT
LIF$30.01233$1.55$361.15Quarterly$6,992.33
LUN$31.70220$0.11$24.20Quarterly$6,974.00

For a new investor, the smartest way to use either is as a controlled slice alongside a boring core like a broad exchange-traded fund (ETF) or diversified blue-chips so you get the excitement without letting one commodity cycle dictate your whole financial mood.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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