Why are precious metals moving? It is not just nervousness about the pandemic, although that is clearly playing a part, suggests growth stock expert Mark Skousen in his specialized higher-risk advisory service, Home Run Trader — and a participant in MoneyShow’s Virtual Expo on August 18-20. Register for free here.
Record-setting stimulus programs are pushing U.S. debt well past the $23 trillion it hit before the pandemic. This year’s deficit alone may surpass $5 trillion. That could prove inflationary down the road. The dollar also has taken a precipitous drop since mid-May. That could also stoke inflation.
Hecla Mining (HL) is a gold and silver hedge. Established in 1891 and headquartered in Coeur d’Alene, Idaho, Hecla is a leading silver and gold producer with mines in Alaska, Nevada, Idaho, Canada and Mexico.
The company currently has reserves totaling 212 million ounces of silver and 2.7 million ounces of gold. In addition to its current gold and silver operations, the company has several exploration properties and pre-development projects in eight world-class silver and gold mining districts in North America.
Hecla is widely recognized as one of the lowest cost producers in the industry. Last year, for instance, its Greens Creek mine produced 9.9 million ounces of silver at an average cash cost of just $1.97 an ounce.
I expect revenue to hit $641 million this year and climb to $775 million in 2021. If gold and silver prices continue to rise — as I believe they will — those numbers will be better still.
The firm also has a strong balance sheet with reasonable debt and more than $215 million in cash. In short, Hecla is a well-managed, low-priced gold and silver miner with good earnings prospects and plenty of short-term trading potential.
Silver has exploded upward since I added Hecla Mining to our portfolio at $5.44 a share. I think it’s just the beginning of a major move in silver that could catapult it to new highs.