Leeb's Silver Lining

11/15/2002 12:00 am EST


Stephen Leeb

Founder and Research Chairman, Leeb Group

Personal Finance, edited by highly savvy Stephen Leeb, will soon introduce a new portfolio called Vulture Investing, aimed at maximizing short-term gains from an expected major market rebound. In his latest issue, Leeb hints at the type of stocks that will be found in this new portfolio.

"One category of investments that will be just the type of stocks for our Vulture Portfolio is the precious metals sector. Our favorites remain Growth Portfolio holdings, Apex Silver (SIL AMEX) and North American Palladium (PAL AMEX). Meanwhile, two additional stocks that are more leveraged to rising metal prices are Coeur d’Alene (CDE NYSE) and Stillwater Mining (SWC NYSE).

"Coeur d’Alene, a relatively high cost silver producer, will see earnings soar if silver rises. And silver will rise, probably dramatically, if investors sense a sustained and strong economic recovery. This critical precious and industrial metal is in chronic short supply. It’s not far-fetched to imagine $8 an ounce silver prices and profits of 50 cents to $1 per share for this miner. Buy Coeur d’Alene up to $1.75.

"Stillwater, which owns one of the world’s richest platinum and palladium deposits, has been a sad story of horrendous mismanagement. Yet the deposit remains intact. Moreover, despite a leveraged balance sheet, profits could approach $1 a share in 2003 even if metal prices don’t improve. Rising metal prices are highly probable, as is the likelihood of competent management, eventually. The potential is huge. Buy Stillwater up to 9."

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