Tumultuous times historically offer some of the best opportunities to buy stocks, and the market's recent mess surely qualifies. That mess often leaves companies poised for big gains, and many investors think Hecla Mining (NYSE: HL ) is one of them.
In our Motley Fool CAPS community, nearly 95% of the 805 investors rating the company are bullish, There's no shortage of reasons why those bulls think Hecla Mining will thrive; I've highlighted three below.
Here at The Motley Fool, we're all for looking at both the good and bad sides of an investment. Once you're done with this article, be sure to read the case against Hecla Mining, and then weigh in with your comments below or rate the investment in CAPS.
1. Improving operations
Following record second-quarter silver production and improving liquidity, Hecla recently upped its production guidance for the year, while slashing its cash cost per ounce of silver by more than a third. As a result, cash flow is up, and the company's now expecting full-year cash costs to come in at less than $3 per ounce. The increase in cash flow is being helped by a sharp rebound of byproduct base metals prices.
2. Precious metals rebound
Hecla Mining, Newmont Mining (NYSE: NEM ) , Kinross Gold (NYSE: KGC ) , and Coeur d'Alene Mines (NYSE: CDE ) have all benefited from the rise in precious-metals prices in recent months. It's been a boon for Hecla's balance sheet, and the company recently said that if precious metals just hold near current levels, it expects substantially stronger cash flow this year.
3. The inflation card
With signs pointing to weakness in the dollar and long-term inflation, many investors find gold and silver a great place to store wealth. While investors typically flock to gold producers such as Yamana Gold (NYSE: AUY ) , silver players such as Silver Wheaton (NYSE: SLW ) , Pan American Silver (Nasdaq: PAAS ) , and Hecla Mining show potential to trump the gains that gold could produce in an inflation-primed climate.
To see details of what CAPS members are saying now about Hecla Mining, just click on over to Motley Fool CAPS and have a look. Or add your thoughts directly to this story in the comments box below.
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