Cassiar Gold Corp. (TSXV: GLDC, OTCQX: CGLCF)
Revitalizing the Cassiar Gold District in British Columbia, Canada
The market in 2024 seems a bit unpredictable, with unfavorable conditions of high interest rates and inflation. Despite this, the Toronto Stock Exchange Composite Index has still risen by 5% year-to-date. Many Canadian mining stocks have surged in price, ignoring the macroeconomic risks and uncertainties. It’s not difficult to guess for investors focused on the mining industry that these strong Canadian mining stocks are somewhat related to the hottest metals of the year, gold and copper.
Two Canadian mining stocks to discuss today are Agnico Eagle Mines Ltd (TSX:AEM) and Teck Resources Ltd (TSX:TECK.B), which have seen price increases of 24.3% and 26% respectively year-to-date. Importantly, their uptrends may not have ended yet.
Let’s start with Agnico-Eagle Mines. Over the years, this gold mining company has focused on operational efficiency and risk reduction, achieving stable performance and strong cash flow for many years, making it one of the safest gold stocks globally.
This is primarily due to Agnico-Eagle’s operational strategy. Unlike other gold miners, all of the company’s mines are located in politically stable, mining-friendly countries and regions like Canada, Europe, Australia, and Mexico. In the current global environment of geopolitical turmoil and increasing conflicts, this ensures that the performance of this gold producer is determined solely by market factors and company operations, with mining operations not disrupted by civil unrest or government interference. In other words, Agnico has greater control over its success or failure than many other companies.
Besides operational factors, market conditions have also been favorable for Agnico-Eagle. Gold prices have risen by 8.5% year-to-date, and in the environment of inflation and geopolitical uncertainties, the safe-haven nature of gold continues to attract investors, pushing gold prices higher. Coupled with Agnico’s record production levels, it’s hard for the stock price not to rise.
Compared to Agnico-Eagle, Teck Resources, a global mining and metals company with a market capitalization of CAD 34.5 billion, is more diversified. The company’s assets are spread across Canada, the United States, Chile, and Peru, with three main business segments: copper, zinc, and currently the largest revenue contributor, steelmaking coal.
However, the focus is on Teck’s sale of coal assets and the transition to a copper-focused company. The recent sale of the coal business will bring in CAD 9.6 billion in cash (on top of the current liquidity of $7.9 billion), which will be used for debt repayment, shareholder returns, and investment in the copper business. In the recent quarter, Teck’s copper production increased by 58%.
Teck’s transformation plan comes at an opportune time. In the coming years, with supply disruptions and demand growth, the copper market is expected to face a supply shortage. The market has already reacted, with copper prices surging by 18% year-to-date.
