In this article, we will look at the 7 Best Zinc Stocks to Buy According to Hedge Funds.
Zinc is a vital part of modern industry and plays a major role in galvanizing steel to produce alloys and promote sustainable energy storage. Construction, automotive, healthcare, and even dietary supplements are among its many uses.
Zinc’s importance is on the rise with a renewed focus on sustainable manufacturing, an increasing number of electric vehicles (EVs), and the growth of infrastructure projects. The Business Research Company has reported that the global zinc market will develop significantly. It is expected to rise from $28.82 billion in 2024 to $41.76 billion by 2029, with an annual growth rate of 7.6%.
The market trend further highlights zinc’s upward surge. Over the previous year, zinc futures have risen by 19.63%, increasing from $2,405 per metric ton on February 18, 2024, to $2,877 on February 19, 2025. Refined market fundamentals and investor trust have driven this expansion. In 2024, zinc production stood at 20 million tons, while its consumption stayed consistent at 19 million tons. China, Peru, and India continue to be the lead producers of the metal. However, global trade patterns have shifted, leading to an 11% drop in zinc imports, bringing it down to 4.2 million tons. After continuous growth of two years, exports also showed a decline of 8.5%, down to 4.6 million tons. This decline was mainly caused by a deceleration in the EV market, as vehicle manufacturers started experimenting with other materials. Furthermore, the shift to green energy momentarily disrupted conventional supply chains, leading to variations in zinc trade.
Regardless, zinc demand remains steady in the main industrial sectors. The U.S. and China held their position as the lead importers of the metal during the year. In 2024, it was reported that the USA imported almost 589,000 tons of zinc, making up 14% of total imports, while China imported 441,000 tons, contributing to 11% of total imports. This shows how zinc still plays a key role in infrastructure, the automotive sector, and technology advancements.
As the globe transitions to a low-carbon economy, zinc is becoming a vital facilitator of decarbonization with coatings alone, accounting for 60% of global zinc consumption. The International Zinc Association (IZA) forecasts a 22% increase in zinc demand from the automotive sector, which amounts to an additional 140,000 tons by 2030. This expansion is fueled by the increasing automobile sales in China and India, the surging preference for larger vehicles, and the increased utilization of galvanized steel in electric vehicle manufacturing.
Beyond the automotive industry, zinc’s demand is also increasing in renewable energy. According to Zinc.org, by 2030, solar power infrastructure will require approximately 568,000 tons of zinc, as zinc-coated steel becomes essential in solar arrays and wind turbines. Meanwhile, zinc is increasingly influential in agriculture due to the Zinc Nutrient Initiative (a program with the aim to add zinc fertilizer to soils to significantly increase crop yield, and boost nutritional value in humans), which has created an annual need of 400,000 tons for fertilizers. Moreover, the increasing popularity of zinc-based dietary supplements is boosting market demand.
In parallel, technological progress in zinc recovery and recycling is moving the industry toward sustainability. Innovations in direct leaching and submerged lance technology are improving extraction efficiency while minimizing environmental impact. A significant advancement, named Kobe Steel’s FASTMET process, has achieved a remarkable 95% recovery rate of zinc from steel mill waste and industrial by-products. These innovations are transforming waste into recyclable resources, fostering a circular economy that encourages zinc’s sustainability in the long run.
As the industry progressively emphasizes sustainability, zinc’s significance in infrastructure, energy, and agriculture continues to grow, offering profitable prospects for investors. Considering this, let’s examine the 7 Zinc Stocks According to Hedge Funds.
Image by Angel Chavez from Pixabay
Methodology
To compile our list of the 7 Best Zinc Stocks to Buy According to Hedge Funds, we first conducted extensive research to identify companies with significant exposure to the zinc industry. We define exposure in terms of zinc mining, refining, or the production of zinc-based products.
We then extracted the number of hedge fund holders having a stake in the respective companies, as of Q4 2024, using data from Insider Monkey’s hedge fund database. The finalists are stocks with the highest hedge fund interest.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
7. Sibanye Stillwater Limited (NYSE:SBSW)
Number of Hedge Fund Holders: 18
Sibanye Stillwater Limited (NYSE:SBSW) is a global mining company that operates in South Africa, the U.S., Europe, and Australia. It is recognized primarily for its production of gold and platinum group metals (PGMs) such as palladium, platinum, and rhodium. In June 2023, it made a considerable move into the zinc sector by obtaining Australia-based New Century Resources, enhancing its foothold in battery production and industrial metals markets.
These developments are already yielding positive results, with the company’s Australian operations producing approximately 82,000 metric tons of payable zinc in 2024. Despite facing operational hurdles, this was an advancement over the previous year. The increase in zinc prices, averaging $2,800 per metric ton, along with reduced treatment charges of $148 per metric ton, contributed to enhanced profitability. As a result, adjusted EBITDA for the region turned positive at $34 million, recovering from a loss in 2023. This shift was primarily influenced by consistent production following weather interruptions earlier in the year. However, costs rose by 17% to around $2,300 per metric ton due to higher royalties and maintenance capital investments.
Despite these improvements, declining PGM prices impacted Sibanye Stillwater Limited (NYSE:SBSW)’s overall financial results. For the year ending December 31, 2024, revenue declined by 9%, although adjusted EBITDA remained stable at $360 million. The company secured a $500 million streaming agreement with Franco-Nevada to counter tighter margins and reinforce its financial position. This will allow the company to improve its value while simultaneously reducing its debt load.
Despite these financial modifications, Sibanye Stillwater Limited (NYSE:SBSW) continues to be firmly committed to its fundamental assets. The Franco-Nevada deal ensures that the company holds significant exposure to platinum and palladium prices, preserving its influence in the PGM market. Furthermore, it is actively expanding its renewable energy capacity, with 407MW of projects under development. This strategy is expected to decrease dependence on grid electricity and lower long-term operational costs, further enhancing the company’s sustainability efforts.
Sibanye Stillwater Limited (NYSE:SBSW) is focused on driving its Australian growth strategy forward. With ongoing feasibility studies for the Mount Lyell copper project and phosphate development, along with an emphasis on cost management and base metals expansion, the company is establishing itself as a major player in the zinc sector and beyond. As it continues to progress, Sibanye Stillwater Limited (NYSE:SBSW) is demonstrating its significant influence in shaping the future of the global zinc sector.
6. Hecla Mining Company (NYSE:HL)
Number of Hedge Fund Holders: 27
Hecla Mining Company (NYSE:HL) is the largest silver producer in the U.S., with operations in silver, gold, lead, and zinc. Its major zinc concentrate production comes from the Greens Creek and Lucky Friday mines. The company’s zinc reserves totaled 60,600 tons in 2024, strengthening its presence in base metals.
Hecla Mining Company (NYSE:HL) generated over $900 million in revenue in 2024, mainly driven by higher metal prices and increased production. Free cash flow from Greens Creek and Lucky Friday reached $228 million, with Greens Creek contributing $186.5 million of this total. Lucky Friday set a new record for ore throughput, generating 13,513 tons of zinc, which helped offset cost inflation.
Furthermore, Hecla Mining Company (NYSE:HL) improved its financial standing by lowering its net leverage ratio from 2.7x to 1.6x, boosted by a record adjusted EBITDA of $337.9 million. Capital investment amounted to $215 million, concentrating on expanding production and developing mines. The company also made advancements in ESG initiatives to reinforce sustainable mining practices.
On the other hand, the main hurdles faced by Hecla Mining Company (NYSE:HL) included rising labor and power costs. Additionally, the ramp-up challenges and permitting delays at Keno Hill challenged its position. Despite this, Greens Creek maintained strong cash flow, and Lucky Friday’s performance bolstered zinc output. The company’s Canadian mine, Casa Berardi, will continue underground operations through mid-2025, although a production hiatus from 2027 to 2032 could affect cash flow.
Looking ahead, Hecla Mining Company (NYSE:HL) expects silver production of 15.5 million to 17 million ounces in 2025. The efforts made to improve silver grades at Greens Creek and increase throughput at Keno Hill are expected to play a key role. With the increased throughput of 600 tons per day from Keno Hill, coupled with Lucky Fridays mine’s extended life of 18 years, the company warrants steady production. With a strong asset foundation and targeted expansion strategies, Hecla continues to be a leading zinc stock choice for investors.
5. Southern Copper Corporation (NYSE:SCCO)
Number of Hedge Fund Holders: 33
Southern Copper Corporation (NYSE:SCCO) is a world-renowned mining company, and its major zinc-producing assets include the Charcas, San Martín, and Santa Bárbara mines in Mexico. Additionally, Southern Copper runs a zinc refinery, strengthening its role in the global zinc supply chain through combined mining, smelting, refining, and production activities.
In the year ended December 31, 2024, Southern Copper Corporation (NYSE:SCCO)’s stellar performance led to record net sales of $11.43 billion, a 15.5% increase from the previous year. This was influenced by higher sales volumes and stronger metal prices. Zinc production increased 98.5% year-over-year to 130,011 tons due to the full ramp-up of the Buenavista Zinc concentrator. Zinc sales also increased by 44.6% to 144,139 tons, contributing to a 39.2% increase in net income to $3.38 billion, while adjusted EBITDA rose 27.4% to $6.41 billion, maintaining a strong 56% margin.
Going forward, Southern Copper Corporation (NYSE:SCCO) is proceeding with a $15 billion investment plan. This will include the El Pilar copper project in Mexico, which will produce 36,000 tons annually using the solvent extraction and electrowinning (SX-EW) technique. Modernization initiatives at Minera Mexico further aim to improve efficiency and sustainability, guaranteeing sustained production growth over the long term.
Southern Copper Corporation (NYSE:SCCO) projects a 32% increase in zinc output in 2025, with ongoing improvements, reaching 171,700 tons. The expansion of its resource base and enhanced cost efficiencies position Southern Copper Corporation as a premier investment option in the zinc industry.
4. Hudbay Minerals Inc. (NYSE:HBM)
Number of Hedge Fund Holders: 39
Hudbay Minerals Inc. (NYSE:HBM) is a key mining company that has operations spread across North and South America, focusing on the production of copper, gold, and zinc. The company’s main assets include the 777 zinc-copper-gold-silver mine in Canada and the Constancia copper mine in Peru. These two mines demonstrate Hudbay’s presence in the base metals industry.
For the fiscal year ending December 31, 2024, Hudbay Minerals Inc. (NYSE:HBM) reported a record annual revenue of $2.02 billion, a 19.6% increase from the previous year. This growth was driven by higher copper sales and appreciating gold prices. Attributable net income increased by 15.5% to $76.7 million, reflecting stronger cash flow and operational efficiencies. Adjusted EBITDA reached a record $822.5 million, maintaining a robust margin.
On the other hand, Q4 2024 also faced significant obstacles as revenue declined by 2.87% to $584.9 million, and attributable net income decreased by 30.9% to $21.2 million. These reductions were mainly due to lower grades and heightened production expenses, though zinc production still helped sustain cash flow.
Looking ahead, Hudbay Minerals Inc. (NYSE:HBM) anticipates a 28% reduction in zinc production in 2025, with a projected output of 24,000 tons. This anticipated drop is linked to the extraction of lower-grade base metals at the Lalor mine in accordance with the company’s strategic mine plan.
To address future production stability, a preliminary economic analysis on the reprocessing of zinc plant tailings has confirmed the technical feasibility of an alternative. This project has resulted in additional engineering efforts intended to boost long-term zinc output and mitigate expected reductions. With a strong financial position and strategic investments, Hudbay Minerals Inc. (NYSE:HBM) remains a key investment in the zinc market.
3. Rio Tinto Group (NYSE:RIO)
Number of Hedge Fund Holders: 39
Rio Tinto Group (NYSE:RIO) is a renowned mining company with operations spanning iron ore, aluminum, copper, and minerals. Although zinc makes up a lesser share of its portfolio, the company produces it as a by-product at its Kennecott Utah Copper operations, continuing its involvement in the base metals market. As the need for zinc increases in infrastructure and decarbonization technologies, Rio Tinto’s output remains important to the industry.
Rio Tinto Group (NYSE:RIO) reported a 15% increase in net profit, reaching $11.55 billion in 2024, up from $10.06 billion in 2023. However, underlying EBITDA declined by 2% to $23.3 billion, with the main cause being an 11% drop in iron ore prices due to lower Chinese steel demand and increased supply from competitors. Despite these obstacles, the company generated a 3% increase in operating cash flow, supported by elevated copper and aluminum prices and cost efficiencies.
Furthermore, capital expenditures increased to $9.5 billion as Rio Tinto Group (NYSE:RIO) progressed with major projects like the enhancement of its copper resources to satisfy the growing need for electrification. The company upheld a 60% payout ratio, allocating $6.5 billion in dividends to shareholders.
A key development in 2025 was Mitsui & Co.’s agreement, under which the company acquired a 40% stake for $5.34 billion in Rio Tinto’s Rhodes Ridge iron ore project in Western Australia. This initiative is projected to start production by 2030 and tap into 6.8 billion metric tons of iron ore reserves. It initially aims to produce 16 million tons of iron ore each year, with the possibility of increasing to more than 40 million tons.
Moreover, Rio Tinto Group (NYSE:RIO) is also advancing lower-carbon zinc production by enhancing smelting efficiency and reducing emissions, promoting industrial sustainability. These initiatives place the organization in a favorable position to gain from the rising need for responsibly sourced metals.
However, challenges like iron ore price volatility, operational disruptions in the Pilbara region due to adverse weather, and potential pressure on aluminum margins from trade policies persist. Nonetheless, Rio Tinto Group (NYSE:RIO)’s diversified portfolio, cost-effectiveness, and strategic investments boost its position as a top zinc stock for investors.
2. Teck Resources Limited (NYSE:TECK)
Number of Hedge Fund Holders: 66
Teck Resources Limited (NYSE:TECK) is a multinational mining company that operates in North America, Asia, and Europe and is primarily focused on the production of copper and zinc.
In the fourth quarter ended 31 December 2024, the company reported an adjusted EBITDA of $835 million, driven by record copper production and favorable base metal prices. Due to lower ore grades at the Red Dog and Antamina mines and scheduled maintenance at Red Dog, the company faced a major setback. Although zinc sales increased by 24%, there was a 19% year-over-year decrease in zinc-in-concentrate output. Despite this, a 112% increase was recorded in gross profit before depreciation and amortization for the zinc segment, amounting to $320 million.
Furthermore, Teck Resources Limited (NYSE:TECK) maintained strong liquidity with $11.3 billion, which included $7.1 billion in cash. The company also distributed $1.8 billion to shareholders via dividends and share repurchases in 2024.
Also, Teck Resources Limited (NYSE:TECK) reaffirmed its 2025 zinc production forecast of 525,000 to 575,000 tons, ensuring consistent output despite earlier operational obstacles. In the future, the company aims to shift its focus to energy transition metals, robust copper production, and consistent zinc operations. Through this, the company aims for long-term expansion and is ranked among the Best Zinc Stocks to Buy According to Hedge Funds.
1. Newmont Corporation (NYSE:NEM)
Number of Hedge Fund Holders: 69
Newmont Corporation (NYSE:NEM) is the world’s largest gold miner with a diversified portfolio across North America, South America, Australia, and Africa. In addition to gold, the company also produces significant amounts of zinc, primarily from its Peñasquito mine in Mexico.
In the year ended 31 December 2024, Newmont Corporation (NYSE:NEM) sold 247,000 tons of zinc, which was a 144.6% increase of over 101,000 tons in 2023. This increase was primarily due to steady operations at Peñasquito after prior interruptions. The company’s adjusted EBITDA rose by 184.3% year-over-year, from $3.06 billion in 2023 to $8.7 billion in 2024, which was driven by higher gold prices and robust zinc performance. There was also an improvement in financial flexibility as operating cash flow reached $6.3 billion, with $3.6 billion in cash on hand.
Looking forward, Newmont Corporation (NYSE:NEM) expects a reduction in the output of silver, lead, and zinc in 2025, with zinc production estimated at 236,000 tons. This anticipated decline is a result of reduced mining activity in the Chile Colorado pit, along with the mine’s intended sequencing.
Moreover, Newmont Corporation (NYSE:NEM) has announced plans to divest six non-core assets to improve its portfolio. This intends for total proceeds of up to $4.3 billion, including $2.5 billion in cash predicted in the first half of 2025. The company has additionally decreased its liabilities by $1.4 billion in the last year, further refining its balance sheet.
Looking ahead, Newmont Corporation (NYSE:NEM) intends to allocate around $525 million to exploration and advanced projects in 2025. The company’s main focus will be on extending mine life and enhancing resources. Thus, the company is effectively positioned for sustainable expansion in both precious metals and base metals due to a strong asset foundation and careful capital distribution.
Overall Newmont Corporation (NYSE:NEM) ranks first on our list of the Best Zinc Stocks to Buy. While we acknowledge the potential of NEM, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NEM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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