The metals industry falls under the basic materials sector and encompasses companies involved in various activities such as mining, processing, and investing in precious metals like gold, silver, platinum, and palladium. Additionally, companies in this sector mine and process industrial metals like copper, iron ore, and aluminum ore. Some companies also convert raw metal materials into more valuable metal products such as steel.
There is a fine line between the metals industry and mining, with some companies operating integrated mining businesses while others do not. For investors interested in this sector, it is important to understand the nuances of the metals industry and consider investing in some of the best metals stocks available.
In 2024, three top metal stocks worth considering include Rio Tinto, Nucor, and Wheaton Precious Metals. Rio Tinto is a global mining company focusing on industrial metals like iron ore, aluminum, and copper. The company is known for its low-cost operations and efforts to use carbon-free hydroelectricity to power its operations.
Nucor, on the other hand, is a North American steel and steel products company that operates minimills using electric arc furnaces to melt scrap steel. This unique approach, coupled with its focus on using recycled metals and environmentally sustainable practices, has made Nucor one of the lowest-cost producers of steel globally.
Wheaton Precious Metals is one of the largest streaming companies in the world, providing mining companies with upfront payments in exchange for the right to purchase a portion of the production at a fixed cost. With a diversified portfolio of streaming contracts for gold, silver, palladium, and cobalt, Wheaton Precious Metals offers investors an attractive means of investing in precious metals.
Investing in the metals industry can be volatile, especially during economic downturns. It is essential for investors to assess their risk tolerance and focus on industry leaders with low-cost operations that can weather market fluctuations. While short-term volatility may occur, the long-term potential of investing in the metals sector can make it a worthwhile investment opportunity.