Workflow
4 Non-Ferrous Metal Mining Stocks to Watch in a Promising Industry
CDECoeur Mining(CDE) ZACKS·2025-06-06 17:46

Industry Overview - The Zacks Mining - Non Ferrous industry is currently experiencing promising prospects due to rising metal prices, supported by the energy-transition trend [1][4] - The industry includes companies producing non-ferrous metals such as copper, gold, silver, cobalt, molybdenum, zinc, aluminum, and uranium, which are essential for various sectors [3] Metal Price Trends - Copper prices have increased by 23% year-to-date, silver by 25%, and gold by 28%, driven by supply disruptions and geopolitical uncertainties [4] - Uranium prices have reached 71.9perounce,thehighestinoverthreemonths,influencedbyU.S.policiesaimedatenhancingnuclearenergyleadership[4]DemandDrivers−Thedemandfornon−ferrousmetalsisexpectedtoremainhigh,particularlyduetotheirapplicationsintransportation,construction,andrenewableenergysectors[6]−TheU.S.InfrastructureInvestmentandJobsActisanticipatedtosignificantlyincreasethedemandfornon−ferrousmetals[6]IndustryChallenges−Theindustryfaceschallengessuchasashortageofskilledworkforce,risingproductioncosts,andsupplychainissues,promptingcompaniestofocusoncost−reductionstrategiesandoperationalefficiencies[5]−Companiesareexploringalternativeenergysourcestomitigatefuel−pricevolatility[5]InvestmentOpportunities−CompanieslikeFreeport−McMoRanInc.(FCX),CoeurMining(CDE),CentrusEnergy(LEU),andEroCopper(ERO)arewell−positionedtocapitalizeonindustrygrowththroughstrategicinitiatives[2]−CentrusEnergyhasa71.9 per ounce, the highest in over three months, influenced by U.S. policies aimed at enhancing nuclear energy leadership [4] Demand Drivers - The demand for non-ferrous metals is expected to remain high, particularly due to their applications in transportation, construction, and renewable energy sectors [6] - The U.S. Infrastructure Investment and Jobs Act is anticipated to significantly increase the demand for non-ferrous metals [6] Industry Challenges - The industry faces challenges such as a shortage of skilled workforce, rising production costs, and supply chain issues, prompting companies to focus on cost-reduction strategies and operational efficiencies [5] - Companies are exploring alternative energy sources to mitigate fuel-price volatility [5] Investment Opportunities - Companies like Freeport-McMoRan Inc. (FCX), Coeur Mining (CDE), Centrus Energy (LEU), and Ero Copper (ERO) are well-positioned to capitalize on industry growth through strategic initiatives [2] - Centrus Energy has a 3.8 billion revenue backlog and is developing high-performance nuclear fuel components [18] - Coeur Mining's acquisition of SilverCrest Metals has enhanced its silver production capabilities [22] - Ero Copper is on track for significant growth with ongoing modernization efforts [25] - Freeport-McMoRan is expanding reserves and managing costs effectively [27] Industry Performance - The Zacks Mining - Non Ferrous industry has underperformed compared to the Zacks Basic Materials sector and the S&P 500 over the past year, with a decline of 17.7% [9] - The industry's current valuation, based on the forward 12-month EV/EBITDA ratio, is 8.13X, significantly lower than the S&P 500's 24.66X [12] Future Outlook - The Zacks Industry Rank indicates bright prospects for the Mining - Non Ferrous industry, currently ranked 63 out of 244 Zacks industries, placing it in the top 25% [7][8]