Base Metals

Copper Investing

Copper prices are sitting around $2.05 per pound, but a number of copper juniors and explorers have still managed to make impressive gains in 2016.

Copper prices saw some gains at the start of the year, but have dropped back down over May and June to approximately $2.057 per pound. Overall, prices have lost 3 percent year-to-date and are still down 23 percent over the past year.
Still, despite worries over a surplus and waning Chinese demand growth, a number of analysts are forecasting copper prices to rise slightly this year. In the medium term, things are looking more optimistic.
“[T]here is no doubting that the current low price environment is sowing the seeds for the next boom as projects are shelved, delayed, sold or abandoned completely,” stated Thomson Reuters in its most recent copper report.
Meanwhile, a number of copper companies have seen impressive share price rises in 2016. Here’s a look at a few copper mining juniors and developers who have seen impressive percentage gains in share price year-to-date:

Lara Exploration (TSXV:LRA)

Cited as a favorite prospect generator by Rick Rule in a recent interview, Lara Exploration is up a whopping 288 percent so far in 2016. Shares of the company are currently trading at $0.97. It holds a number of mineral properties in Brazil, Colombia, Chile and Peru.
Shares of Lara started to spike in mid May, although the company stated on May 12 that it had fully disclosed all of its material news and was not aware of any changes that would account for the rise. Most recently, Lara announced on June 6 that it had received new exploration licenses (which had been previously cancelled) for its Planalto copper project. The project is located near Vale’s (NYSE:VALE) Sossego copper mine in Brazil.

Western Copper and Gold (TSX:WRN,NYSEMKT:WRN)

With its massive Casino project currently in the permitting phase, Western Copper and Gold is the most advanced company on the list of top gainers. Western Copper has seen its shares rise 136 percent to $0.90 so far this year.
The project, which is located in Canada’s Yukon Territory, holds 4.5 billion pounds of copper, 8.9 million ounces of gold and 65 million ounces of silver, and 483 pounds of molybdenum. A project proposal for Casino was submitted to the Yukon Environmental and Socio-economic Assessment Board in 2014, and the project is set for a panel review.

VVC Exploration (TSXV:VVC)

Finally, Mexico-focused VVC Exploration has gained 133 percent year-to-date to reach $0.035 per share. The company holds a number of projects in northern Mexico, including the Cumeral, Latuna and Samalayuca copper projects.
The most advanced of these is Samalayuca, for which the company is planning a four-year pilot mine project to begin in late 2016. The project is expected to generate over $165 million in revenue assuming a copper price of $2.10 per pound. The most recent news from VVC came on February 4, when it provided an update on the zoning for Samalayuca.

Other copper stocks up year-to-date

Lara Exploration, Western Copper and Gold, and VVC Exploration are not the only copper companies on the rise either. Here are a few other examples of companies who have seen gains this year:

  • Excelsior (TSXV:MIN); up 78.57 percent to $0.375 year-to-date. It is advancing the Gunnison in-situ recovery copper project in Arizona.
  • Panoro Minerals (TSXV:PML,OTCMKTS:POROF); up 65.22 percent year-to-date to $0.19, focused on copper in Peru and released a preliminary economic assessment (PEA) for its Antilla project in May
  • Ivanhoe Mines (TSX:IVN); up 57 percent year-to-date to $0.96, advancing the Kamoa copper project in the Democratic Republic of Congo (as well as its Kipushi zinc project in the DRC and Platreef platinum project in South Africa)
  • Novacopper (TSX:NCQ,NYSEMKT:NCQ); up 56.96 percent year-to-date to $0.62, focused on its projects in Alaska’s Ambler mining district.

Certainly, while the copper price may be down, copper stocks are certainly not out. Investors who agree with the thesis that copper prices are set to rise in the medium term have plenty to choose from.
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Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Western Copper and Gold, VVC Exploration and Novacopper are clients of the Investing News Network. This article is not paid for content.


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