American Tungsten Corp. (TSXV: TUNG, OTCQB: DEMRF)
Building America’s Defense Critical Metals Supply
As gold and silver prices enter a consolidation phase in 2026, Agnico Eagle Mines (TSX: AEM) might be a buying opportunity worth considering.
Currently, gold and silver prices are at a rather delicate stage. Following the sharp and unpredictable plunge in precious metal prices during the early days of the war between Iran and the United States, they are now gradually recovering. Historically, precious metals have served as an effective hedge against macroeconomic storms and worsening geopolitical situations.
However, the outlook for macro risks remains difficult to assess at present, especially since invisible risks are often the hardest to navigate. At the same time, it is difficult to predict how gold and silver will react—will they fall in tandem with equities as they did over a month ago? Regardless, gold and silver mining stocks currently appear quite attractively discounted, particularly if investors believe that gold prices can hold their current levels by the end of the year.
Notably, gold prices have recently risen on expectations of peace talks. During periods of heightened geopolitical risk, the correlation between gold and stock markets may be stronger than usual. From any perspective, for investors seeking both exposure to precious metals and their hedging benefits, along with deeper value, mining stocks are a solid long-term choice. However, mining stocks can be highly volatile and have a history of amplifying losses during gold bear markets. Investors must clearly understand the differences in risk and return between physical bullion and mining equities.
Agnico Eagle Mines currently trades at a trailing price-to-earnings ratio of 18.3 times, with a dividend yield near 1%. Although its technical performance has been weak in recent months, the stock remains worth watching for investors looking to increase their exposure to precious metals. Despite recent pressure on gold prices, the company’s latest quarterly results were broadly strong. While Agnico is not the cheapest gold miner, investors should keep a close eye on the stock if the next phase for precious metals trends upward—especially as the Iran war nears its end.
It should be noted that Agnico primarily mines gold, but silver is an important byproduct of its production. Given the recent synchronized rise in both gold and silver prices, Agnico can be viewed as a well-rounded investment choice. Of course, there is no guarantee that gold and silver will maintain a strong correlation by the end of the year.
If the so-called “Strait of Hormuz will not be closed” scenario fails to materialize—or if the strait remains closed longer than expected—the next move for gold is difficult to predict, especially since gold prices reacted quite negatively to the escalation of the war. This raises a question: If the blockade persists longer, will gold prices start to rise, or will they continue to trade sideways? Time will tell.
Overall, Agnico Eagle Mines presents certain investment value during the current consolidation phase of gold and silver prices. The company has solid operating results, benefits from exposure to both gold and silver, and offers an attractive valuation and dividend yield. However, investors must clearly recognize the high volatility of mining stocks and the complex impact of geopolitical situations on precious metal prices. Against a backdrop of unclear macro risks and an uncertain war progression, this stock is more suitable for investors with a longer investment horizon who can tolerate volatility.
