The global push for green energy has also spurred the growth of emerging technologies that make considerable use of platinum group metals (PGMs). This has the potential to make platinum mining stocks a great long-term investment. For example, electric vehicles (EVs) require PGMs for their lithium-ion batteries.
Furthermore, another application for PGMs has recently emerged for a new type of automobile known as a hydrogen fuel cell vehicle. As society transitions to more sustainable energy sources, green hydrogen technologies promise to transform the energy industry, so platinum and the other PGMs are expected to play an important role. Benzinga’s picks for the best platinum stocks for investment purposes are highlighted below.
Best Platinum Stocks to Invest in
Best Platinum Stocks
Check out the best platinum stocks below.
Anglo American Platinum (OTCPK:ANGPY)
Johannesburg, South Africa-based Anglo American Platinum is the world’s leader in the production of PGMs and accounts for 38% of the world’s total platinum production. Anglo American is a transnational company with offices in North and South America, China, South Africa and Europe. The company provides complete resource-to-market services, including mining and recycling to its global network of clients. In addition to platinum, the company also produces rhodium, iridium, palladium, ruthenium and osmium. Anglo American is also the world’s primary recycler and processor of used and spent catalytic converter materials.
Impala Platinum Holdings (OTCQX:IMPUF)
Founded in 1966 and based in South Africa, Impala Platinum Holdings or Implats is a holding company with interests in several mining companies that produce platinum, palladium and other PGMs, as well as copper, cobalt and nickel. The holding company’s most important asset is the Impala mine in South Africa’s North West province. Other interests include the Mimosa and Zimplats mines in Zimbabwe, and the Marula and Two Rivers mines in the South African Bushveld Igneous Complex. The company acquired the Canadian North American Palladium company and its mine in Ontario to form Impala Canada.
Sibanye Stillwater (NYSE:SBSW)
Founded in 2013, Sibanye-Stillwater Limited is a global precious metals mining company based in Weltevreden Park, South Africa with operations in Southern Africa and North and South America. The miner’s diverse holdings include gold and PGM mines in Canada, Argentina and Zimbabwe. Sibanye-Stillwater’s U.S. assets include the Stillwater and East Boulder mining operations in Montana, which are the largest PGM mining operations in the United States. As of December 2020, its PGM mining operations in the U.S. had 26.9 million ounces of proven and probable PGM mineral reserves and 86.9 million ounces of mineral resources.
Founded in 1942 as the Brazilian state-owned Companhia Vale do Rio Dolce, Vale S.A. became a private company and eventually one of the largest mining companies in the world. Rio de Janeiro-based Vale operates in approximately 30 countries and is the world’s largest producer of iron ore, pellets and nickel. In addition to its mining operations, Vale provides infrastructure development services that include constructing ports, railways, terminals and steel and energy manufacturing facilities. As the world’s 2nd largest nickel producer, Vale can extract platinum as a byproduct of its extensive nickel mining operations. The company currently produces approximately 134,000 ounces of platinum annually.
Platinum Gr Metals (AMEX:PLG)
Based in Vancouver, Canada, Platinum Group Metals Ltd. was founded in 2000. The company explores and develops platinum and palladium properties. In addition to its Canadian mining interests, Platinum Group Metals also develops South African mining properties, including the Waterberg project on the Northern Limb of the Western Bushveld complex. Platinum Group Metals also develops next-generation battery technology that uses platinum and palladium. At current prices, PLG stock qualifies for Benzinga’s best stocks under $5 and stocks under $10 lists.
Overview: Platinum Stocks
Platinum is a ductile, malleable metal with a silvery-white appearance. It has the symbol Pt and the atomic number 78. The precious metal is among the least reactive metals and has high resistance to corrosion even at elevated temperatures. This qualifies platinum as a “noble metal.”
First used by pre-Columbian South American civilizations for making artifacts, native platinum can be sourced in the alluvial sands of rivers. The metal was referenced as early as the 16th century, but it was not investigated until a report was published by Antonio de Ulloa in 1748.
South Africa produces approximately 80% of the world’s platinum, which totals just a few hundred metric tons globally every year, thereby making the metal a relatively rare commodity. In addition to its major use in autocatalytic converters, platinum has a number of other uses including, electrodes and electrical contacts, dentistry equipment, jewelry and platinum resistance thermometers.
Platinum’s spot price has fluctuated between $800, where it traded in June 2020, to a high of $1,310 in February 2021. The metal’s current spot price is $1,067.77. Platinum and other PGMs rank among the precious metals alongside gold and silver, with their industrial uses increasing as innovation and new technologies emerge.
Despite the economic slowdown during the COVID-19 pandemic shutdowns, platinum miners and their stocks have recovered significantly, with production now approaching normal levels. Since many investors consider diversifying into precious metals a prudent strategy, buying platinum stocks could make sense, especially if you think platinum will rise in value.
Best Online Brokers for Platinum Stocks
Most brokers will let you purchase American Depository Receipts (ADRs), but if you intend to purchase over-the-counter (OTC) stocks, make sure your broker provides access to that market, and ask what commissions they charge for that type of trade. Check out a broker comparison table below.
Features to Look for in a Platinum Stock
Knowing what to look for in platinum stocks can help you align your stock picks with your investing goals. Here is what to look for in platinum stocks.
Type of Miner
Because of platinum’s rarity, most pure-play platinum mining stocks consist of small microcap companies that can pose significant risks for investors. Some investors, therefore, prefer to select major miners that obtain most of their profits from mining other metals. They might also choose to invest in automotive or jewelry manufacturing companies that use large amounts of platinum in producing their respective goods.
The underlying fundamentals of any publicly traded company tend to influence whether its stock will appreciate in the future. Take into account a company’s current profitability, its level of debt, future prospects for its products, its management and other fundamental considerations when selecting a stock to invest in. The stock’s earnings per share and other fundamental metrics can serve as useful indicators when determining if a stock’s price is likely to rise or fall in the future.
While smaller platinum reserves can be found in the U.S. and Canada, Russia and South Africa account for roughly 90% of world production. Most miners situated outside of those two key producing countries need to partner with or lease mines from local companies. Platinum mining can be affected by geopolitical events and natural disasters that occur where platinum deposits are located.
Are Platinum Stocks Good Investments?
With the global move toward greener and more sustainable energy and transportation options, the use of platinum and other PGMs will likely increase in the future. This could make investing in platinum miners an excellent opportunity for investors looking to profit from this technological trend, while companies that use platinum in manufacturing their products can have a notable exposure to a rise in the metal’s price.
The stocks of the mining companies reviewed above also represent relatively “pure” platinum plays, which means that the firms directly benefit from platinum mining operations, exploration and production. Among our platinum stock selections, only PLG does not qualify for Benzinga’s stocks under $20 category, and they all represent solid investments in the platinum industry.
Most automakers rely heavily on platinum for the catalytic converters used in gas-powered vehicles. Automakers also own most of the patents for hydrogen fuel cells that will probably power new technologies in the industry. Jewelry makers also have a considerable exposure to the price of platinum. Companies that could have their profits hurt by higher platinum prices include automakers like General Motors (NYSE: GM) and Toyota (NYSE: TM) or jewelry makers like Tiffany’s (NYSE: TIF).
Frequently Asked Questions
What are platinum stocks?
Platinum stocks are shares in companies that mine platinum.
Are platinum stocks good investments?
Platinum stock is considered a good investment because platinum is required to manufacture electric vehicles.
What are the best platinum stocks?
Check out Benzinga’s list above of the best platinum stocks.
Read also: BEST COBALT STOCKS