While everyone has been focused on surging gold prices, the silver space has quietly been on fire too. In fact, while gold ETFs like (GLD – ETF report) have added about 25% year-to-date, silver funds such as (SLV – ETF report) have actually gained nearly twice as much, adding roughly 45% so far in 2016.
And much of this gain has been in the past month, as SLV has added more than ten percent, compared to a gain of just over 1% for GLD in the same time frame. Clearly, some level of leadership in the precious metal world is being to shift to silver, even if most investors remain ignorant about the gains.
This under-the-radar trend makes for an interesting situation for investors. It could actually make for a great time to buy some silver mining stocks which have lagged the competition up until now, but are actually seeing strong fundamentals in terms of earnings estimate revisions. A great example of this is Tahoe Resources (TAHO – Snapshot Report) .
This Nevada-based company has mines in Guatemala and Peru, and it actually has exposure to both silver and gold. The company has underperformed its counterparts and a broad silver mining benchmark on a YTD look, and while that isn’t good news for current investors, it could make for a fantastic entry point for new investors seeking to get in on the silver bull trend before it is too late.
Why TAHO Now
Analysts have been embracing TAHO shares as evidenced by recent increases in earnings estimates. In fact, we haven’t seen a single estimate move lower in the past sixty days for either the current quarter or the current year, while analysts are now looking for EPS growth of close to 28% this year.
The magnitude of these estimate revisions has also been impressive, as the current quarter estimate has gone higher by more than 20% in the past two months, while we have seen long term—full year and next year—figures zoom higher by more than 27% each in the same time period.
No wonder the stock has been marching higher as of late, and why the stock has earned itself a Zacks Rank #1 (Strong Buy). Plus, with a recent move into strong buy territory, and a lack of price appreciation relative to precious metal prices in the past month, this could be a timely addition.
And if that wasn’t enough, investors should also consider the strong momentum that this stock possesses. TAHO shares have an ‘A’ Grade for Momentum, thanks in large part to its nice move over the past three months, and momentum in earnings estimate revisions as well.
Investors have largely overlooked silver and silver miners this year, shunning them in favor of companies more-focused on the gold space. However, now could be the time to make a bet on some of the underperformers in this space which still have strong fundamentals. After all, the silver industry currently has a Zacks Industry Rank in the top 1% and it is actually second overall out of more than 250 industries.
So if you are seeking to make a play on this surging sector, definitely give TAHO a closer look. It hasn’t run up as much as its counterparts, though it currently has strong earnings estimate revisions and incredible momentum prospects as well, making it a potential timely add for those seeking to jump in to this now in-focus market segment.
And if you want more information on the precious metal mining market, make sure to watch our recent podcast on the topic below:
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