ARIS, NSR, ORA, TRQ & HZM: 5 TSX metal & mining stocks as BoC hike rate

June 02, 2022 12:03 PM EDT | By Sundeep Radesh
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  • On Wednesday, June 1, the Bank of Canada (BoC) raised the borrowing rate again by half a percentage point
  • Usually, tech stocks are sensitive to interest rate hikes, while commodities are often looked at as a hedge against inflation
  • All these stocks have gained this year

On Wednesday, June 1, the Bank of Canada (BoC) raised the borrowing rate again by half a percentage point. This is the second consecutive half-point increase by the bank, which is a new for them.

Usually, tech stocks are sensitive to interest rate hikes, while commodities are often looked at as a hedge against inflation.

The market entered 2022 expecting these hikes and the BoC has done it three times already. The S&P/TSX Capped Information Technology Index has lost 36 per cent year-to-date (YTD).

In contrast, the S&P/TSX Composite Index Metals and Mining (Industry) has gained 3.75 per cent YTD. So, let’s look at some TSX metal and mining stocks.

Aris Gold Corporation (TSX:ARIS)

The stock of this gold miner with interests in Colombia and Ontario closed Wednesday at C$1.97. It has gained 30.5 per cent this year.

It rose 15 per cent in the last month. ARIS’ price-to-earnings (P/E) ratio, effectively how many dollars needs to be invested in the stock for each dollar’s gain, is 26.4.

Nomad Royalty Company Ltd (TSX:NSR)

As the name and ticker suggests, it acquires stakes of certain percentages in various properties to earn royalty.

NSR closed on Wednesday at C$9.90. Its gain in 2022 is two per cent. Over the last three months, it has increased over 16 per cent.

Compared to ARIS, its P/E ratio of 556.9 is rather high. But it comes with a dividend and its dividend yield is over two per cent.

Aura Minerals Inc (TSX:ORA)

ORA at market close Wednesday stood at C$11.09. It has gained almost three per cent so far, this year. In the last week, it has gained over three per cent.

In terms of valuation metrics, ORA has the best P/E ratio and dividend yield of all the stocks on this list; that of 9.4 and nearly four per cent, respectively.

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Turquoise Hill Resource Ltd (TSX:TRQ)

A relatively large company that operates at a global level with a market cap of C$7.2 billion, TRQ closed Wednesday at C$11.09.

It has zoomed a whopping 77 per cent YTD. It has returned 94 per cent in six months. It P/E ratio of 10.1 is comparable to that of ORA.

Horizonte Minerals Plc (TSX:HZM)

UK-based Horizonte develops nickel in Brazil and Monday saw HZM close at C$2.32. In 2022, it has increased 5.5 per cent.

It has a P/E ratio of 98.1 and is currently just 16 per cent above its 52-week low of C$2, reached on February 16.

5 TSX metal & mining stocks

Bottom line

After the BoC made the announcement, the TSX Composite Index closed in the red on Monday by 0.08 per cent. During the day, the tech sector fell 2.12 per cent. However, the base metals sector saw a negligible loss of 0.01 per cent. All these stocks have gained this year.

Also read: Can summer cheer boost these 5 TSX midcap stocks?

Please note, the above content constitutes a very preliminary observation based on the industry, and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.



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