Sean Brodrick – Opportunities Presenting Resource Investors In Silver And The Quality Silver Stocks
Sean Brodrick, Editor of Wealth Megatrends and contributing analyst to Weiss Ratings Daily, joins us to outline opportunities that he is seeing in silver and the quality silver stocks. We start off discussing the disconnect we’ve seen the last couple of years in silver versus gold, but that recently this year, and even in the month of August so far, we’ve started to see that outperformance of silver over gold. Sean points to the industrial side of solar panel production underpinning the current pricing, but ultimately sees investor demand starting to come in to both silver and the silver equities as the force that could really create some outsized moves to the upside in the medium-term.
When looking at the universe of silver equities, Sean is less attracted to the earlier-stage junior explorers, preferring the revenue generating silver producers as having the best leverage to rising prices without getting stuck in value stunting equity dilution. We discuss the potential for the silver producers just below or near parity to have the most upside torque when higher silver prices lead to significant margin expansion and improving economics. Sean brings up Hecla Mining (NYSE: HL) as an example where they’ll see their margins improving in Q2 and Q3 and that they have the Keno Hill mine that they acquired from Alexco as another area of growth in the latter half of this year. This leads into a discussion on if we'll see more merger and acquisitions start up in the silver space.
We wrap up discussing how diversification in jurisdiction plays a factor in his portfolio and recommendations to subscribers. He is in a wait and see mode currently with regards to Mexico, due to the political posturing, but that makes him more open to other areas in Canada, the US (specifically in Nevada), Argentina, Australia, and even Africa. He highlights Aya Gold & Silver (TSX: AYA, OTCQX: AYASF) as having had great performance for his subscribers for some time, while most North American investors may not have expected that out of a company based in Morrocco.
- In full disclosure, Shad is a shareholder of Hecla Mining at the time of this recording.
Click here to follow along with Sean’s work at Weiss Ratings Daily and Wealth Megatrends
