Silver Soars: Here's How to Gain Exposure

Key Points

• Silver's surge defies expectations, with prices up 17% year-to-date, reaching $28.09 per ounce.
• Geopolitical tensions in Europe and the Middle East contribute to rapid increases in both silver and gold prices.
• Amidst the instability, iShares Silver Trust, First Majestic, MAG Silver Corp. and Silvercorp Metals Inc. offer investors exposure to the silver market, poised to benefit from the ongoing price rally.

Silver has surged impressively, defying expectations amidst a buoyant economic landscape and optimistic market sentiments. Its recent rally showcases an upward trajectory, with Silver Futures currently trading at $28.09 per ounce, marking an impressive 17% increase year-to-date from the starting point of $23.95.

Several factors contribute to silver's remarkable ascent. Alongside geopolitical uncertainties like tensions in Europe, ongoing conflicts in the Middle East, and a lack of resolution in sight between Ukraine and Russia, silver and gold prices have rapidly increased. This further solidifies silver's position as a safe-haven asset, driving demand and providing investors with a secure and confident investment option amidst global instability.

Four stocks stand out as potential avenues for investors seeking exposure to the silver market without buying physical silver: iShares Silver Trust, First Majestic, MAG Silver Corp. and Silvercorp Metals Inc. These companies operate within the silver industry and are poised to benefit from the ongoing price rally.

4 Stocks to Gain Exposure to Silver

1. iShares Silver Trust 

iShares Silver Trust NYSE: SLV holds physical silver, which is exchanged for shares issued by the Trust. Each share of the Trust represents a fractional ownership of its net assets. Currently, SLV manages $11.82 billion in assets with a net expense ratio of 0.5%.

Over the previous twelve months, SLV has increased almost 11%. During that period, total institutional inflows have been $634.74 million, with $538.52 million in outflows. As of February 12, Baymount Management LP was the largest shareholder of SLV, with a 4.57% ownership stake and 22.5 million shares. 

While SLV is already up an impressive 16.7% year-to-date, it's nearing a critical juncture as it swiftly approaches its highs made during the pandemic in 2020. Going forward, it will be worth noting how the SLV acts near significant resistance and highs near $26.

2. First Majestic Silver

First Majestic Silver NYSE: AG acquires, explores, develops and produces mineral properties, focusing on silver and gold production in North America. The company has a market capitalization of $2.28 billion and a modest dividend yield of 0.25%.

Shares of the company have enjoyed a stellar start to the year, up over 30% year-to-date. While bullish in their consensus rating of Moderate Buy, analysts are cautious about the stock's valuation, with their consensus price target of $6.75 predicting over 16% downside. 

3. MAG Silver

MAG Silver NYSE: MAG engages in the exploration and development of precious metal mining properties. The company explores for silver, gold, lead, copper and zinc deposits. MAG has a P/E of 26.62, a market capitalization of $1.29 billion, and impressively has projected earnings growth of 68% for the full year. 

Like the names mentioned above, MAG has surged higher recently. The stock is up 21% year-to-date, thanks to its recent breakout above $9.70. Analysts are bullish on the stock, with a consensus Buy rating based on four analyst ratings. Notably, the stock's consensus price target is significantly higher than where it's trading — the $18 price target forecasts over 43% potential upside for MAG.

4. Silvercorp Metals

Silvercorp Metals NYSE: SVM, primarily engages in the acquisition, exploration, development and mining of mineral properties in China. The company mainly explores for silver, gold, lead and zinc metals. SVM offers a dividend yield of 0.78% and has a market capitalization of $679 million.

While the stock is red over the previous year, thanks to the recent surge in the price of commodities like silver and gold, SVM has surged over 33% this year and is up a whopping 59% over the previous month. As the stock now nears a significant level of resistance of $4, investors would want to see the stock showcase its strength by turning this area of resistance into newfound support if the move is to continue.