3 Best Silver Stocks To Buy (2023)

3 Best Silver Stocks To Buy (2023)

Investing in silver stocks can be a great way to diversify your investment portfolio and protect against inflation. Silver has been used as a reliable store of value for centuries and has a number of important industrial applications, including in the production of solar panels and electric vehicles.

When considering investing
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When considering investing in silver stocks, it's important to do your due diligence and research individual companies. Look for primary silver producers with strong cash flow and a focus on silver, as well as those with exposure to the booming industrial demand for silver.

It's important to remember that investing in silver stocks comes with risks, including market volatility and the potential for losses. As with any investment, it's important to determine your risk tolerance and invest accordingly.

Investing in silver stocks can be a great way to diversify your portfolio and hedge against inflation. By researching individual companies and understanding the market, investors can make informed decisions and potentially see strong returns over time.

Top Three Silver Stocks to Buy in 2023

Silvercorp Metals Inc.

Silvercorp Metals Inc. is a Canadian company that operates silver-lead-zinc mines in China. The company's flagship mine, Ying Mining District, is located in the Henan Province and has been in operation since 2006. As of the end of the fiscal year 2021, Silvercorp Metals had proven and probable reserves of 39.1 million ounces of silver, 288 million pounds of lead, and 82.2 million pounds of zinc.

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Financial Performance:

In fiscal year 2021, Silvercorp Metals generated revenue of $167.3 million, a 2% increase from the previous year. The company's net income was $32.6 million, a decrease of 23% from the previous year. The company's cash flow from operations was $68.9 million for the year, a significant increase from the previous year.

Key Strengths:

One of the key strengths of Silvercorp Metals is its focus on silver mining. It is one of the primary silver mining companies in China, which gives it exposure to a growing market for the metal. Additionally, the company's mines have low cash costs and solid operating margins, which should help to insulate the company from fluctuations in the price of silver. Silvercorp Metals also has a strong balance sheet, which provides the company with financial flexibility to pursue growth opportunities.

Potential Risks:

One of the potential risks to Silvercorp Metals is the geopolitical environment in China. The company's operations are subject to regulatory and political risks related to its location within China. Additionally, the company's dependence on China's economy could also pose risks to Silvercorp's financial performance. Another potential risk is the volatility of silver prices, which could impact the company's revenue and profitability.

Analyst Recommendations and Target Price:

According to analysts surveyed by Investing.com, the consensus rating for Silvercorp Metals is a "buy." The average target price for the stock is $10.45 CAD, which implies an upside potential of 24% from current levels.

First Majestic Silver Corp.

Company Overview and Financial Performance:

First Majestic Silver Corp is a Canadian company primarily engaged in silver mining. The company owns three producing mines in Mexico and one mine that is currently being developed. In 2020, the company produced 11.9 million ounces of silver, making it one of the largest primary silver producers in the world. First Majestic Silver Corp reported revenue of $373 million in 2020, a decrease of 1.5% from the previous year. The company's net loss in 2020 was $77 million, which was largely driven by non-cash impairments related to a decline in the carrying value of its mineral properties.

Key Strengths
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Key Strengths:

First Majestic Silver Corp has a strong focus on silver mining, with the metal accounting for more than 90% of its revenue. The company's mines have low cash costs, with its San Dimas mine having one of the lowest cash costs of any primary silver mine in the world. This provides the company with a competitive advantage and helps it to generate strong operating margins. The company also has a strong balance sheet with a healthy cash position, which provides it with financial flexibility to pursue growth opportunities.

Potential Risks:

One of the main potential risks to First Majestic Silver Corp's performance is the volatile price of silver. Silver prices can fluctuate significantly based on factors such as global economic conditions and the level of industrial demand. Additionally, the company's mines are located in Mexico, which exposes it to risks related to political and regulatory changes in the country. The company is also exposed to risks related to exploration and production, including operational risks, geological risks, and environmental risks.

Analyst Recommendations and Target Price:

According to MarketWatch, the current consensus among nine analysts is to hold the stock, with two analysts rating it as a sell and three rating it as a buy. The average target price for First Majestic Silver Corp is $19.38, which represents an upside of approximately 37% from its current trading price. However, it is important to note that analyst recommendations and target prices can change frequently and should be viewed as one factor among many when evaluating an investment.

Pan American Silver Corp.

Pan American Silver Corp is a Canadian mining company with operations in North and South America. The company's primary focus is on silver mining, with the metal accounting for approximately 50% of its revenue. In addition to silver, the company also produces gold, zinc, lead, and copper.

Financial Performance:

In 2020, Pan American Silver Corp reported revenue of $1.8 billion, a decrease of 12% from the previous year. The company's net loss in 2020 was $27 million, which was largely driven by non-cash impairment charges. The company's cash flow from operations was $174 million, which was a significant improvement from the previous year.

Key Strengths:

Pan American Silver Corp has a diversified portfolio of mines in different regions, which help to mitigate risks related to political and regulatory changes in any one country. The company's mines also have low cash costs, which provides it with a competitive advantage and helps it to generate strong operating margins. Pan American Silver Corp also has a strong balance sheet with a healthy cash position, which provides it with financial flexibility to pursue growth opportunities.

Potential Risks:

One of the main potential risks to Pan American Silver Corp's performance is the volatile price of silver. Silver prices can fluctuate significantly based on factors such as global economic conditions and the level of industrial demand. The company is also exposed to risks related to exploration and production, including operational risks, geological risks, and environmental risks. Additionally, Pan American Silver Corp is exposed to risks related to political and regulatory changes in the countries where it operates.

Analyst Recommendations and Target Price:

According to a survey of 14 analysts conducted by MarketBeat, Pan American Silver Corp has an average rating of "Buy" and a consensus target price of $41.50. This target price represents a potential upside of approximately 29% from the current market price. The company has a strong track record of meeting or exceeding analyst expectations, which has contributed to positive investor sentiment toward the stock.

How to Invest in Silver Stocks

Here are the steps to follow to invest in silver stocks:

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Types of Investment Vehicles Available:

There are several types of investment vehicles available for those looking to invest in silver stocks. These include individual company stocks, silver exchange-traded funds (ETFs), and mutual funds that focus on the silver mining industry. It's important to decide which investment vehicle is best for your investment goals and risk tolerance.

Steps to Buying Silver Stocks
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Steps to Buying Silver Stocks:

a. Firstly, open a brokerage account with a reputable broker that offers access to silver stocks.

b. Next, research the companies or funds you are interested in investing in. Look at factors such as their financial performance, exposure to silver, and management team.

c. Once you have identified the companies or funds you want to invest in, place your order through your brokerage account. You can buy shares of individual stocks or ETFs with just a few clicks.

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Tips for Successful Investing:

a. Diversify your portfolio by investing in several different silver stocks or funds. This helps to mitigate risk and maximize potential returns.

b. Pay attention to the price of silver and how it may affect the performance of your investments.

c. Stay up-to-date on industry news and trends to make informed investment decisions.

d. Consider your risk tolerance and invest accordingly. Remember, investing in silver stocks can be volatile and comes with risks.

By following these steps and tips, you can invest in silver stocks and potentially benefit from the rising value of this precious metal.

Frequently Asked Questions

What are the advantages of investing in silver stocks over physical silver?

Investing in silver stocks has a number of advantages compared to physical silver. Firstly, it is much easier and less expensive to invest in silver stocks than to buy and store physical silver. Secondly, investing in silver stocks provides more liquidity than buying physical silver, as investors have the option of selling their holdings whenever they wish. Thirdly, there are a number of different ways to invest in silver stocks, such as through individual company stocks, ETFs, and mutual funds. This allows investors to diversify their investments across multiple silver companies or funds.

What are the risks associated with investing in silver stocks?

Investing in silver stocks comes with certain risks. Silver prices are affected by global economic conditions and industrial demand, which can cause volatility in the stock price. Additionally, the companies may be exposed to risks related to exploration and production, including operational risks, geological risks, and environmental risks. Political and regulatory changes in countries where the company operates could also affect its performance. It is important for investors to be aware of these risks before investing.

What are some other silver stocks worth considering?

First Majestic Silver is another silver stock worth considering. The company has a strong track record of meeting or exceeding analyst expectations and its shares have gained more than 80% since the start of 2021. First Majestic has several high-grade silver mines in Mexico, Canada, and Peru, which provide a steady supply of the precious metal to its customers.

Silver Wheaton Corp is another well-known silver stock that investors may want to consider. Wheaton Precious Metals Corp has a long history of growing its dividend and is focused on diversifying its production base outside of the Americas. The company has operations in Canada, Sweden, and Mexico, and it recently announced a joint venture with Vale to explore silver in Brazil.

Silver stocks can also be a way to access silver without having to own the physical metal. ETFs that invest in silver companies or funds provide investors with exposure to silver without having to buy and store physical silver. These ETFs can also offer more liquidity than buying physical silver, as they are traded just like any other stock. Some of the most popular silver ETFs include iShares Silver Trust and ETFS Physical Silver.