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Three Stocks to Buy as Silver Prices Soar

The stock market is down nearly 7% over the last couple of months—and even AI stocks like Nvidia (NVDA) and Intel (INTC) have lost hundreds of billions of dollars in value between them.

But one historic rally is still in full swing.

This overlooked asset is up 28% for 2024 so far. That's over 4x greater than the Dow's 6.8% rise… and it's also outperforming gold.

There are a few reasons behind its rise.

For one thing, demand has outstripped supply for years now, as hundreds of millions of solar panels and tens of millions of electric vehicles are built with it. And even the semiconductors that make the global AI Revolution possible will require about 22 million ounces a year by 2030, according to MetalFocus.

But the biggest reason why this boom could last years is one Warren Buffett mentioned in last year's conference for Berkshire Hathaway shareholders.

Because it's mostly produced as a byproduct metal (from mines primarily focused on extracting gold or copper), supply can't be turned on like a tap.

That means it could be years before a supply/demand balance is restored—even as the clean energy and AI revolutions continue to demand hundreds of millions of ounces each.

The asset is, of course, silver. Last year, demand exceeded supply by 184 million ounces—and prices are surging as the shortfall continues as the AI and clean energy revolutions demand more and more silver.

Buy silver bullion, and you'll probably do all right.

But three silver mining stocks are poised to outperform silver's rally—thanks to a few special advantages.

Silver Mining Stock #: Wheaton Precious Metals (WPM)

This investment has not only thrashed gold and silver's returns over a 1-year, 2-year, 3-year, and 5-year period… it's also paid a dividend that's grown by 220% over the last decade.

It can do this thanks to its unique structure—because it collects royalties on mines rather than handling operating costs, it's not a mining company in the true sense of the word. Yet with just a few dozen employees, it's laying claim to over $1 billion in revenue from mines all over the world.

Silver Mining Stock #2: First Majestic (AG)

As Buffett noted, most miners produce silver as a byproduct of another metal—but one small-cap firm is a rare exception.

Valued at just $1.7 billion, it's perhaps the closest thing in the world to a "pure play" on silver mining.

Its biggest silver mine is producing for as little as $14.17 per ounce… which means enormous upside for this company if silver prices climb half as high as experts are forecasting… and the 150,000 ounces of gold it produces on the side won't hurt, either.

The company's dividend policy is one of the most shareholder friendly I've seen… as a rule, it gives back approximately 1% of revenues back to shareholders.

Mind you, that's revenues, not profits—so if and when silver prices surge, this company's dividend could balloon for shareholders, too.

Analysts are projecting 460% growth next year for this firm—compared to just 12.3% for the S&P 500 average.

This is the closest thing to a "pure play" in silver—and unlike the precious metal itself, First Majestic pays a hefty dividend.

For investors looking to cash out on a silver boom, and be paid a growing income stream while watching it unfold, I can't think of a better opportunity than this.

Silver Mining Stock #3: Pan American Silver (PAAS)

Pan American Silver is currently sitting on a mine of over 250 million ounces of high-grade silver.

It's already spent hundreds of millions of dollars getting the mine ready to produce tens of millions of ounces each year.

And as recently as 2017, this very mine was producing high-quality silver that cost the firm just $10/oz to extract.

Obviously, a mine of over 250 million ounces of silver at just $10/oz will be a game-changer for this small company… but there's been a problem.

The Central American country it's located in requires a bureaucratic consultation that has been delayed since a new government took over in January.

Right now, this little country is in the process of replacing the only bureaucrat who can carry out the mandated consultation.

On a recent earnings call, the CEO was careful not to say anything about the delay to antagonize the government.

But no government on earth is going to allow a mine of this magnitude to continue going untapped forever—not when there is a fortune in taxes to collect from it.

I believe this company could receive the go-ahead to start tapping into one of the most lucrative mines on Earth within a month at the most—so you'll want to move before then.

In the meantime, this company has a sterling record of delivering income to shareholders.

Not only has it managed to raise its dividend in recent years—including in 2020, when the pandemic sent most miners reeling—but it still pays almost 50% more than the average S&P 500 company. All that is to say, as the explosive silver catalyst nears, I don't think investors will mind the wait.

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