December 28th, 2020 | 10:13 CET
Nornickel, Newcrest Mining, Silver Viper, First Majestic: Does silver have catch-up potential?
Table of contents:
"[...] Internally we expect the resource to significantly grow the deeper we mine. [...]" Dennis Karp, Executive Chairman, Manuka Resources
Newcrest and Nornickel: Silver under the radar
At Newcrest Mining, silver accounts for less than one percent of total sales. Nornickel does not explicitly report silver and subsumes the precious metal and cobalt, rhodium, or tellurium under the by-products. Nor does it appear that silver plays a significant role in the major commodity companies' plans: Nornickel wants to invest primarily in copper production in the coming months, increase output, and incidentally position itself more sustainably - there is no talk of either gold or silver at Nornickel.
Only palladium and platinum play a role for the Russian Company. Both precious metals are essential for car production and have offered opportunities for investors in recent years, even independently of the precious metal boom. However, the reason for the share price rally, especially for palladium, was primarily market distortions. The Nornickel share was hardly able to profit from this: On a twelve-month horizon, the share offers a zero return.
The share of Newcrest Mining, on the other hand, benefited more from precious metals, with more than 80% of the Australian Company's sales coming from gold. The second most important raw material is copper, with a share of around 17%. However, this mix did not go down well on the stock market last year: The share lost 8.6%, this is all the more surprising as Newcrest can boast low production costs of less than USD 900 per ounce of gold.
Silver Viper: Professional investors wait patiently
Silver Viper's shares demonstrate the fact that the actual production of raw materials is often more complex than the development of promising production sites. The Canadian junior Company is pushing ahead with the La Virginia project in Mexico. Between 2010 and 2012, more than 50,000 meters were already drilled there, revealing some promising results with gold and silver deposits.
Currently, Silver Viper is using the historical data to explore the property and expand the resources comprehensively. In the wake of the pandemic-related precious metals rally, the stock also benefited, returning about 100% over the past twelve months.
As of December 2020, Silver Viper had USD 3.5 million in cash on hand, positioning it well for further exploration and the USD 100,000 property purchase instalment due in June. The Company is little known to private investors, but professional investors such as Sprott Asset Management, US Global Investors, Commodity Capital and the Contrarian Group are on board.
Big names have some catching up to do in silver
Since large commodity companies often neglect silver in their planning, smaller producers, such as Fortuna Silver or First Majestic Silver, or exploration companies with significant silver deposits, such as Silver Viper, could soon become more attractive. Historically, silver is still undervalued compared to gold.
It is also an industrial metal: Silver can be used, especially in electrical equipment, solar cells, or medical technology. Investors would do well to keep an eye on some promising companies in the silver sector, and gold, especially the big names in the industry have some catching up to do in this respect. Takeovers are anything but excluded in the medium term.
Conflict of interest
Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.
Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.
Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and etc. on news.financial. These contents serve information for readers and does not constitute a call to action or recommendations, neither explicitly nor implicitly. implicitly, they are to be understood as an assurance of possible price be understood. The contents do not replace individual professional investment advice and do not constitute an offer to sell the share(s) offer to sell the share(s) or other financial instrument(s) in question, nor is it an nor an invitation to buy or sell such.
The content is expressly not a financial analysis, but rather financial analysis, but rather journalistic or advertising texts. Readers or users who make investment decisions or carry out transactions on the basis decisions or transactions on the basis of the information provided here act completely at their own risk. There is no contractual relationship between between Apaton Finance GmbH and its readers or the users of its offers. users of its offers, as our information only refers to the company and not to the company, but not to the investment decision of the reader or user. or user.