We recently published a list of 7 Best Zinc Stocks to Buy According to Hedge Funds. In this article, we are going to take a look at where Hecla Mining Company (NYSE:HL) stands against other 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.
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).
Aerial view of a gold mine, with its winding roads and pits.
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.
Overall, HL ranks 6th on our list of best zinc stocks to buy according to hedge funds. While we acknowledge the potential of HL, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than HL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. This article is originally published at Insider Monkey.