Investors have shown a particular affinity for gold and silver stocks this year, as worries leading up to the presidential election mounted.
Close on the heels of the rebound in precious metals' prices, Alamos Gold (AGI) gained a whopping 128.57% this year and Hecla Mining (HL) had an incredible 283.07% jump. These two mining stocks are poised to continue their upward trajectory.
Alamos Gold is a Canadian intermediate gold producer, with a varied production roster, including operating mines in North America (Young-Davidson), and the El Chanate and Mulatos mines in Mexico.
The company also carries a 19.07% stake in Corex Gold, which promises attractive exploration opportunities. Alamos Gold's reserve strengths are proven and robust, having grown by 570% since the end of 2014.
With Alamos Gold's advantages, such as low capital intensity, a technical risk development pipeline and lower costs, investors have exhibited a deep interest in its shares.
Alamos Gold has continuously reported an impressive year-over-year rise in quarterly revenue akin to peers including B2Gold and Kinross Gold and could improve profitability in the next two quarters as well.
Gold prices should maintain current high standards, powered by a low or negative interest rate environment around the world and the air of uncertainty in the U.S.
Analysts suggest another 30% to 40% upside potential over the next 12 months.
Hecla Mining, primarily a silver producer with assets in Alaska, Idaho and Mexico, offers massive wealth creation capabilities.
Strong quarterly results coupled with a robust production outlook have added to its allure.
For investors who missed out on the first run in silver commodity prices and silver producer stocks, this is a chance to garner great gains.
Observers expect an upside in silver prices over the next 12 to 18 months driven in part by a demand in the photovoltaics industry.
This boost is propelled by Hecla Mining's strategy of expanding operations, which began when precious metal prices began plummeting a couple of years ago.
Given the strengths in the sector, Hecla Mining's stock at 22.62 times its forward price-earnings ratio isn't really expensive when considering its year-to-date performance and how it stacks up to peers.
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