7 Best Copper Stocks to Buy | Investing

Copper is one of the most useful of the industrial metals. Its versatile set of unique properties and wide range of uses give copper several valuable commercial applications that make it practically indispensable to our modern, global economy.

Copper is supremely suited for industrial uses. First of all, it’s highly malleable, meaning it can be bent and molded to fit our needs without losing its strength or integrity. This is why it’s been used extensively in plumbing, roofing and cladding for centuries. Secondly, copper is an excellent conductor of electricity, making it a great choice for electrical applications on an industrial scale, including in electric vehicles. Thirdly, it’s an efficient conductor of heat energy, making it perfect for furnaces, radiators and all kinds of refrigeration applications.

Copper is practically impervious to corrosion and corruption, so it’s used in many commercial and industrial projects – both high-tech and low-tech – all over the world. As such, many investors and economists use copper consumption as an economic indicator. To a real extent, as the copper industry goes, so goes the world economy.

If you’re bullish on continued global development, electric cars, green energy and worldwide economic growth, you should likewise be bullish on copper stocks. Fortunately, there are many publicly traded mining and metals companies to choose from as well as several excellent exchange-traded funds, or ETFs, for investors to consider.

Here are seven of the best copper stocks to own in 2024 and beyond:

Metals Acquisition Ltd. (MTAL)

MTAL is a more than $900 million company that acquires and runs metals and mining operations in politically stable, well-governed jurisdictions that have established respect for the rule of law. MTAL says it’s dedicated to the decarbonization of the global economy over the coming decades.

The crown jewel of MTAL’s portfolio is the CSA Copper mine in Cobar, Australia, which it acquired from Glencore PLC (OTC: GLNCY) in June 2023. The CSA Copper mine is a major contributor to the economy of New South Wales, Australia and an important component of global copper production. The CSA mine is well known for producing an exceptionally high grade of copper ore.

There are a relatively limited number of Wall Street analysts who follow MTAL, but, on average, they estimate that the company will generate $362 million in revenue in 2024 and produce 37 cents per share in earnings. The company plans to be highly selective in new acquisitions but does expect to grow its mining portfolio over time.

On March 4, 2024, the equity research department of Scotia Bank initiated coverage of MTAL with an “outperform” rating.

In addition to several other valuable copper-producing operations, TGB currently owns 87.5% of the Gibraltar mine located in British Columbia. Current and prospective TGB shareholders should be very pleased to hear that, in a press release dated March 25, 2024, the company announced that it was acquiring the remaining 12.5% interest in that highly productive property. This acquisition will cement the firm’s position as a major player in the copper industry.

With a market cap of over $620 million and consistent estimated revenue of over $90 million per quarter for 2024, TGB is well worth consideration by metals investors.

TGB is headquartered in Vancouver, British Columbia, but is actively expanding into the U.S. with the Florence Copper Project in Arizona. The company plans to use an innovative copper mining method called “in-situ leaching” at the Florence project. TGB is pioneering the use of in-situ leaching because it uses less water, less energy and is less destructive to the surrounding landscape. In short in-situ leaching is more effective, less costly and has a much smaller carbon footprint than traditional copper mining methods.

Freeport-McMoRan Inc. (FCX)

No list of the best copper stocks would be complete without the $67 billion mineral and mining leader FCX. While the company is not exclusively a copper producer – it has significant operations in gold, silver and other lesser-known metals as well – copper is a primary driver of the company’s results.

FCX reported an impressive $22.9 billion in revenue for 2023 with an 8.1% profit margin for the year. Notably, the company forecasted that revenue would grow at a rate of 4.4% per year over the next three years compared to 4.1% for the metals and mining industry as a whole. Meaning, FCX believes it will grow its revenue about 7% faster than its peers.

FCX is based in Phoenix, but it has operations and facilities in New Mexico and Colorado as well as in South America and Indonesia. The stock currently pays an annual forward dividend of 60 cents per share, which equates to a 1.3% dividend yield.

Ivanhoe Electric Inc. (IE)

One of the most exciting aspects of the company is its proprietary “Typhoon” geophysical survey technology. The Typhoon system works by analyzing electromagnetic signals that are projected deep into the earth. The Typhoon system is proving to be one of the most accurate methods of locating copper and other sulfide minerals, and it does it at a much lower cost and with a minimal environmental impact.

IE is only generating about $1 million a quarter in revenue right now, but keep in mind that the company was only founded in 2020. The stock has a market cap of about $1.2 billion. Investors should think of IE as an aggressive stock with a high degree of risk and above-average volatility. Those who can accept the risks will enjoy great potential for exceptional returns as the U.S. continues to electrify its automotive fleet.

Compañía de Minas Buenaventura S.A.A. (BVN)

BVN is a Peruvian company with a $4.2 billion market cap. In addition to operations in its home country of Peru, BVN has significant, producing assets in the U.S., Asia and Europe.

Copper is a significant and growing source of revenue and earnings for BVN, but it’s just one of several metals the company produces and sells. BVN also mines gold and silver, along with the base, or industrial, metals zinc and lead. The company is further diversified by operating a thriving energy generation and transmission business as well as a profitable insurance brokerage.

Wall Street appears quite bullish on the stock’s revenue growth. Analysts forecast $927 million in revenue in 2024 and expect that figure to increase by some 2.5% to $951 million in 2025.

Invesco DB Base Metals Fund (DBB)

Because DBB is a $190 million ETF that invests its assets in copper commodities futures as well as aluminum and zinc derivatives, this fund is not suitable for all investors.

That said, DBB is an excellent choice for more aggressive investors who want to track and replicate the returns of the general industrial metals industry and are willing to accept the enhanced volatility and risk that comes with investing in futures.

As of March 25, 2024, 35.27% of the fund’s assets were invested in copper futures. This allocation should serve the fund well as the developed world continues to electrify its automobile fleet and move forward with the transition to green energy. The rest of the assets are in aluminum and zinc futures, at 33% and 31.54%, respectively.

Interestingly, the fund is required to hold collateral securities to facilitate the leverage that is required to invest in commodities on margin. It accomplishes this by holding U.S. Treasury bonds, investment-grade bonds and high-quality bond funds. This collateral does not strictly count as assets under management (AUM) but the fund does benefit by earning interest on the collateral securities.

The last entrant on our list, FQVLF, is one of the most productive companies of its size in the metals and mining industry. Wall Street is expecting FQVLF to take in just over $4 billion in revenue in 2024. That’s a remarkable number for a company with a market cap of $9 billion.

FQVLF is focused heavily on the exploration, development and production of copper resources, but it is also a prominent player in nickel, pyrite, zinc, gold and silver.

The company has no mining or production assets in the U.S. FQVLF, which is based in Vancouver, operates facilities in a diverse set of jurisdictions, including Zambia, Panama, Finland, Turkey, Spain and Australia.

CFRA Equity Analyst Matthew Miller is bullish on the stock. In a research report dated March 23, 2024, he expressed the belief that investors are being overly pessimistic regarding political turmoil in Panama. He believes the stock has the potential to rebound as things improve in that country. Miller has a “buy” rating on FQVLF.

Note that on U.S. exchanges, FQVLF trades in U.S. dollars as an American depository receipt, or ADR. The company also trades on the Toronto Stock Exchange in Canadian dollars under the ticker symbol FM.