Best Palladium Stocks

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Often compared to platinum, palladium is a precious metal largely found in Russia, South Africa, the U.S. and Canada. Palladium has a variety of uses in several industries, including the jewelry, dentistry and electrical industries, but its most widespread application consists of the manufacture of catalytic converters for the automotive industry. Palladium stocks can be a great investment.

Catalytic converters control exhaust emissions to minimize the pollutants expelled by automobile engines. Because of palladium’s use in catalytic converters, one of the principal drivers of the market for palladium and palladium stocks is automobile production. A whopping 84% of global palladium annual demand comes from the automotive industry, so palladium tends to appreciate when car sales are high.

Despite the initial slowdown in automotive sales due to the COVID-19 pandemic, the need for palladium for other uses and the increasing difficulty in sourcing the precious metal has been a key factor in palladium’s recent notable price rise.

Furthermore, according to Statista, 75% of all mined palladium comes from Russia and South Africa, so natural disasters and geopolitical events in those countries could substantially affect global supplies of palladium and hence its price. For example, a contributing factor to the recent sharp rise in palladium prices was the announcement in March 2021 that Russia's top producer Nornickel experienced flooding at its mines that would reduce its palladium output.

5 Best Palladium Stocks to Invest in

Here are Benzinga's top picks for the best palladium stocks to invest in right now.

1. Sibanye Stillwater (NYSE: SBSW)

Founded in 2013 and headquartered in Weltevreden Park, South Africa, Sibanye-Stillwater Limited is an international precious metals mining concern with global operations in North and South America and Southern Africa. The company’s diverse portfolio of operations include gold mining operations in South Africa, as well as PGM mining operations in Zimbabwe, Canada and Argentina. Sibanye-Stillwater’s mining operations also generate valuable by-products, including iridium, ruthenium, copper, nickel and chrome. The miner owns the Stillwater and East Boulder mines in Montana that are the only palladium mines in the United States.

2. Ivanhoe Mines (OTCQX:IVPAF)

Vancouver, Canada-based Ivanhoe Mines Ltd explores, develops and recovers PGMs, other metals and minerals. Mostly operating in Africa, the company owns a 100% interest in the Western Foreland exploration project in the Democratic Republic of Congo (DRC) and also has holdings in South Africa. Ivanhoe Mines has also partnered with a Japanese consortium and others to own the recently-discovered Platreef project that has substantial deposits of palladium, platinum, rhodium, gold, copper and nickel. In addition, the mining company is involved in upgrading the historic Kipushi mine that is also located in the DRC. At current levels, IVPAF stock qualifies for Benzinga’s stocks under $10 list.

3. Anglo American Platinum (OTCPK:ANGPY)

The world’s leading producer of PGMs, Anglo American Platinum offers complete resource-to-market services including providing mined, recycled and traded products to its global network of customers. Headquartered in Johannesburg, South Africa, the company’s PGM products include palladium, platinum, rhodium, iridium, ruthenium and osmium. The company’s operations span the globe with offices in Europe, North and South America, China, Finland and South Africa. Anglo American is also the world’s leading global recycler and processor of used and spent PGM catalytic converter materials.

4. New Age Metals (OTCQB:NMTLF)

Formerly known as Pacific Northwest Capital Group, New Age Metals Inc. was founded in 1996 and is involved in the exploration and development of PGM, precious metal and base metal mining properties in Canada. The Vancouver, Canada-based company has a 100% interest in the River Valley Palladium project in the Dana and Pardo townships of Northern Ontario, as well as in the Genesis polymetallic project in Southcentral Alaska. New Age Metals also has interests in 8 lithium projects northwest of Winnipeg, Manitoba.

5. Platinum Gr Metals (AMEX:PLG)

Involved in the exploration and development of palladium and platinum properties, Platinum Group Metals Ltd. is based in Vancouver, Canada, and was incorporated in 2000. The company’s main focus is on properties in South Africa, including a 50% interest in the Waterberg project on the Western Bushveld complex. In addition to its mining and exploration projects, the company develops next-generation battery technology using palladium and platinum. At its current price level, PLG stock qualifies for Benzinga’s stocks under $5 list.

What are Palladium Stocks?

Palladium is the rarest and currently most valuable of the precious metals and has a silvery- white, shiny appearance in its natural form. The chemical element palladium has the symbol Pd and atomic number of 46.

Palladium was discovered by the English chemist William Hyde Wollaston in 1803. Wollaston isolated palladium after dissolving platinum in a mixture of nitric and hydrochloric acid and then noticing a second metal was left behind. Wollaston named it palladium after the asteroid Pallas that was discovered in 1802, which was named after Pallas Athena, the Greek goddess of wisdom, useful arts and prudent warfare. 

Palladium has the least density and lowest melting point of the platinum group metals (PGMs) that include rhodium, iridium, ruthenium, osmium and platinum. Palladium is most notably used in automobile catalytic converters, as well as in groundwater treatment, various chemical applications, medicine, dentistry, hydrogen purification, electronics and jewelry. 

Approximately 40% of palladium production comes from Russian mines, and other major palladium mines can be found in South Africa. The Stillwater mine in Montana remains the only palladium mine in the U.S, while the Lac des Iles mine in Ontario is the only palladium mine in Canada. 

The price of palladium now trades at the $2,850 per troy ounce level and has almost tripled since 2018 when it traded under $1,000 per troy ounce. Palladium stocks have also rallied significantly recently despite the slowdown in the gas-powered automotive industry.  

Features to Look for in Palladium Stocks

Here are the top features to look for in the best palladium stocks.

Type of Miner 

Palladium mining stocks can be junior mining operations or major miners.

Junior miners: This type of miner depends on feasibility studies and subsequent actions after a study. If the study has positive results, the junior miner’s stock tends to appreciate considerably. Most junior miners sell the mines and stock before the end of the project and cash in on the efforts. 

Major miners:  Major miners consist of miners that have ongoing operations and depend on established mines for  palladium production. Major miners tend to be better capitalized, and the stock prices reflect this.

Fundamentals 

As in other companies that issue stock, the fundamentals of the company can make a difference in the stock’s capital appreciation. If the company currently makes money, how much debt is on its books, as well as its future prospects could indicate whether the stock’s price will rise in the future. A stock’s earnings per share and other fundamentals provide a good indication of whether a stock will perform. 

Partnerships 

Since most palladium is mined in Russia and South Africa, the relationship the company has with foreign companies that lease or allow access to its mines could be an important factor in the success of the company. Also, geopolitical tension could affect production, so it’s an important consideration when picking a palladium mining stock. 

Best Online Brokers for Palladium Stocks

Benzinga’s palladium stock picks include foreign stocks that you can trade through American Depository Receipts (ADRs) that allow you to own foreign stocks in the United States. ADRs generally trade either over the counter (OTC) or on a major stock exchange. 

Make sure you check with your brokerage firm to see if it has access to the palladium stocks you wish to invest in, especially if the broker will need to fill orders in the OTC market for you to trade the OTC stocks on our list. 

Is Now a Good Time to Buy Palladium Stocks?

The stocks listed above have already seen some pretty hefty gains recently, with PLG stock increasing by +161% over the last year alone as an example. NMTLF is the only penny stock on this list, and it has also shown considerable gains of 173% over the last year. 

Most of these selected palladium stocks have risen significantly during the past 12 months due in part to an acute supply shortage in palladium, which is still one of the rarest of the precious metals with diverse uses that continue to increase with time. 

Prudent investors might therefore want to wait for a pullback in palladium stocks, or the stock market in general, although these stocks still probably represent a good overall long-term investment due to palladium’s scarcity and ongoing industrial uses. 

Frequently Asked Questions

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