You Have Until May. Then It s Too Late.

Demand for this critical material is surging, but the price action is slowing down. Is now the time to buy copper? Marketbeat analyst, Jeffrey Neal Johnson is here with his take on the entire copper industry. He's going to go over three different areas of copper and give seven stocks to look at buying right now, as well as talking about a stock or a category of stocks that you want to avoid in this sector. And this is definitely an area where investors can get tripped up, but there's also a ton of demand for this area right now, Jeffrey. Talk about why we're seeing such rising demand for copper. There's so many different reasons that copper is in a deficit right now. You have the AI data center build out where the chips as well as the data centers require massive amounts of copper. On average, a data center is 50,000 metric tons of copper. But then you also have the electrification of everything. We have a failing electrical grid, and to repair that failing electrical grid is going to take tons and tons and tons of copper, somewhere around $1.6 trillion worth of copper. And then finally, you have the continued electrification of everything, which is electric cars and electric lawnmowers, electric everything being turned over, and all of that requires copper. What you're seeing right now is that we are running at a copper deficit of 330,000 metric tons per year, and it takes roughly 10 to 15 years to get a copper mine online. Yeah, the demand here is incredible, and it's really hard to ignore that right now because when you have a deficit that large and you still have the incredible demand that we're seeing right now, that usually leads to profit. But there's been some wild activity happening in copper. I know there's plenty of investors who've gotten burned on some copper investments. I know the price of copper has also been really volatile. Why are we seeing those ups and downs? The AI thesis came out and the notice that we were in such a deficit of copper came out, and that caused copper to shoot to a record $6.58 per pound. But that was also during the time that gold, silver, uranium, aluminum, everything was reaching, and that was a lot because of the geopolitical tension. Well, now we're entering a risk-off phase of that same situation because of, for instance, the closing of the Strait of Hormuz. That's creating this risk-off scenario because of the geopolitics, because a lot of these mines and mining assets are in geopolitically unstable regions. It's created a situation where almost the entire market has now dipped down to where it's below the previous run, which creates kind of like an overcorrection scenario in my mind, and we're reaching now a point where it's like overcorrecting, and that is the point where you wanna start looking at accumulation, but you wanna accumulate the right stock. Previously, the people that got burned in this market were just buying anything with a copper stamp on it, and that's not how the market for copper works. That's not how mining works, and so you have to focus on the appropriate type of copper stock, and you have to use a situation called a barbell strategy. Barbell strategy is where you wanna anchor your portfolio with these heavy-producing companies that are making dividends and producing metal now. Then you want to add in the diversity of some ETFs that we will talk about later in the show, and then you also wanna add in the volatility of these junior producers or these advanced developers that we're going to talk about, and the advanced developers provide you the volatility and the upside while the foundational players provide upside and an anchor. Sounds like a really great way to approach having a balanced investment into copper and everything that's happening in this industry. I wanna start out with the what to avoid. Sometimes we save that for the end, but this time we're gonna save that ETF approach to copper for the end of this video. Let's start out with what type of copper investments you wanna avoid as an investor, and then we're gonna get into the seven names that are good ones to look at for a nice balanced approach to investing in copper. Okay, so in the previous run, a lot of the people that got burned were looking at prices and they didn't pay attention to the type of copper stock they were buying. They saw that they were miners, but they didn't really pay attention to how far developed the mines were. And so you're looking at companies like Kodiak Copper and others that are still looking for their mother load. Like they know that there's copper in the ground somewhere, but they don't know how much copper, they don't know how dense or pure the copper is. And those are the companies that you wanna stay away from because they're not making any money and they're also not producing anything. You have so many variables there. We know there's copper, but we don't know if it's gonna be worth mining. We don't know how we're gonna mine it. We don't know how far down we gotta go. And we don't know the method that we need to extract it at this point. And so all that speculation together creates a stock that's down roughly 10% over the past few months, 20% over the long term. And it's a stock that's not gonna produce anytime soon. They're years away from it. All right, well, let's get into the names that we should be looking at buying right now, starting with the safer names of these companies that are actually producing copper right now. So the first one on our list is gonna be Southern Copper. Their symbol is SCCO. And they're probably the best example of a company that you can look for. When you're talking about miners, miners have very, very fixed costs, right? So if it takes $1.60 to pull a pound of copper out of the ground today, it's gonna take $1.60 tomorrow. It's gonna cost pretty much the same amount of diesel, the same amount of people, all that sort of stuff. When the price of copper goes up, whatever it goes up, that increase flows straight to their bottom line because their prices haven't increased any. And SCCO is probably one of the best examples of that. They have a staggering amount of operational leverage, right? I think somewhere around like 50.3% operating margin. And it creates a situation where very quickly a small catalyst that pushes the copper market up could push this stock up as well. A really good case for the first one and some interesting price action in that one too. Let's get onto the second name. We've got a lot of different names to get to, so we're gonna power through to the next one right away. Right, so our next one's gonna be Freeport. And they're, of course, NYSE, the New York Stock Exchange, FCEX. Freeport is the premier United States copper giant, right? They operate assets in North and South America. They have assets in Arizona. They have assets in Peru. And they manage the Grossberg Minerals District in Indonesia. They produce 240 to 300 million pounds of copper annually. And that's being produced at an insanely low price of a dollar per pound because they have leaching technology that really cuts their prices down. So they're making a massive operational leverage situation for them as well, so that when the price of copper goes up a little bit, it's also gonna push that up. In February, interestingly enough, there was a whole flurry of upgrades. So this stock currently trades at around $50 a share. And in February, there was a whole flurry of upgrades that was marking this stock in the $70 to $80 range. And I don't anticipate that those $70 to $80 range analyst upgrades will change just because of geopolitical tension. Another great name to look at of a company that's already producing and producing at a low rate. I think that's what stood out about this one too. Let's get on to the next name that you have for us, the third copper miner that you're looking at. The next one we're talking about, ERO Copper, and they are NYSE ERO. They are also, so they're in the phase of producing, but they are the one that has the most development potential. So that's going to be the most speculative one out of the three, even though all three that we talked about are fairly solid stock. This one will be the most speculative with the most room to grow. It's about a $23 stock or so, and they're operating three primary assets in Brazil, but one of the assets in Brazil that they're operating has the diversity of gold. So now you're stacking gold on the backside of this copper thesis, and it creates a little bit of a less risk kind of scenario. And that is why the consensus on this stock is a moderate buy at like 30 to 50, which gives us a 37% upside, but you've got downgrades that have come in from like Raymond James and Bank of America, which has created a perfect entry point for this stock because those downgrades are based upon near-term situations that can be resolved fairly quickly. So once they get these situations resolved, the downgrades will be changed and the stock price should start elevating. All right, so we've talked about the producers. We know that there's been plenty of volatility even for these three names that are all producing right now. There's just volatility in general in the market, and there's some shifting happening in where investors are putting their investments right now too. So if you want to check out Jeffrey's take on some other smart money moves for your portfolio, make sure to scan the QR code and click the link in the description for his latest article on sector rotation. There's two smart money moves for 2026. It's an interesting reading. You can find that article again on our website through this QR code if you want to check that out after the video. But we have four more names to cover yet, Jeffrey, and now we're switching into a different area of the copper production phase. These aren't the people actually producing the copper. Now we're looking at the people who are helping to find it, right? So when we were talking about the ones to stay away from, those are the ones that are drilling in the ground, trying to find their copper deposits. The ones that we want to anchor with are the ones that we just talked about. Those are the ones that are looking for more copper but are already producing copper and or gold. In the middle is where you have what are called advanced developers, right? They have already developed the land, found their copper mother load. They're starting to dig it out and they're getting ready to start the production phase. So it's in between, we don't have anything and we're producing it right there in the middle. But this is where your money's at, right? This is before the mine gets started. So if you find these stocks that are just about ready to start producing, you're going to get in right before they're actually creating revenue and selling things. And that sounds like something a lot of our viewers are looking for is that before a company spikes up, let's get into the first thing you have for us. So the first one we're going to talk about is Western Copper and Gold. They're NYC American and they're WRN. They are an advanced stage developer and they hold this project called, it's a huge project, it's called the Casino Project. It's in the Yukon Territory. Their underlying economics are pretty extraordinary because that particular deposit is something like 7.1 million ounces of gold and 37.9 million ounces of silver and copper, right? And so the biggest thing for them is the administration that's in office right now has opened up the Yukon Territory, specifically the area that they're already at for more exploration. And so their side of things is that they are already on a piece of land. They're already starting to pull copper out of the ground. They're passing their environmental studies left and right. They recently partnered with Rio Tinto Mining, which is another huge mining corporation, one of our producers that we didn't talk about. And that partnership has given them a lot of money. But one of the cool things about the partnership is that the partnership now no longer includes a board seat, which opens up for when this land gets developed, they will sell it to a producer, right? And the producer list will be more than just Rio Tinto. An interesting case for this company, but I did hear one thing that for some investors might be a little bit of a flag is hearing that under this administration, they're getting into this land that has previously not been available. Could that change with the changing of administrations or the changing of geopolitical issues in the country? I believe it could, but the thing about this is once they open the land and they start exploring the land, it becomes incredibly litigious for them to kind of like take those rights back. But also the United States has initiated this thing called Project Vault. Much like we stockpile oil and we stockpile gas, we wanna have strategic stockpiles of copper and other metals here so that we're not relying on other countries during times of geopolitical turmoil. So I don't think that they would roll this back, but there's always that possibility if the next administration comes in and is completely against this. But I think that that's a reach for now. And I think that by the time that that happens, there'll be so much development that why would you kick somebody off the land that's already developed? Well, there's certainly a lot of effort right now to get that domestic local control of these critical materials, critical metals like copper. So I know that's a part of the use case for all of the stocks we're talking about in this video today. Let's move on. We still have a few more to cover. Let's get to the second stock that you have of these advanced developers that you're looking at. So the next one that we're talking about is Ivanhoe Electric. And they are an extremely high upside developer that has been de-risked by this Project Vault that we were just talking about. They are owned by Robert Friedland. And if you know anything about the mining industry, he is probably one of the top miners. Some of the best producing mines out there were found and developed by him. And so he's using a system that they have developed called Typhoon, which shoots massive amounts of energy into the ground. It penetrates up to 1.5 kilometers deep. And it tells them the quality and the quantity of the deposit, right? Using that technology has discovered a mine that they're working on in Arizona called Santa Cruz. And they've discovered that that copper in that mine is like 99.99% pure copper. They have gone ahead and instead of smelting that copper like you would normally do, they have gone ahead and at that location built the ability to create copper cathodes for sale and push those out into the market. This is gonna be one of those things that when they actually get this thing up and running, it will be a pretty big windfall for whatever producer buys this advanced development. Now, this one sounds like it has a lot of potential again and a huge copper find. So that's going to lead to some more domino effect of positive news for companies down the road. It's a good find in the US. We've got one other company to talk about. That's an up and coming name in the copper mining space. What's that third company in this space to talk about? So the third and final company is gonna be Trilogy Metals and they are NYC American PMQ. And they are an advanced developer as well. And they have a highly prospective set of mineral development. But here's the interesting thing about them. They are in a venture with part of this project, well, they have been de-risked by the Department of Defense, right? So the Department of Defense has given them something like $35.6 million as well as taking a 10% equity stake so that the metals that are mined at this site can then be stockpiled for Department of Defense purposes. And so you look at that and you say, okay, that's a completely de-risked situation. And you start looking at the next catalyst. And then you want to try to accumulate on any dips that are caused by like geopolitical issues or anything like that. Because these stocks are set to accelerate in pace as the mines continue to reach production capability. Because the theory is, is once they reach production capability, they either become producers or they sell or merge with other producers. And of course, that's a catalyst that's gonna provide upside every single time. Yeah, another interesting use case in this space. We've covered a lot of names, a lot of different stocks in the copper space. And if you're not invested into this area at all, it might be a little overwhelming to try and pick which one of these to invest in, especially with the three really interesting, almost there cases that you just talked about that have a lot of growth potential. So let's look into another option. If you wanna become an investor in the copper space, you wanna have some exposure to the growth happening here. Let's talk about ETFs and what that can look like. The whole copper sector, it's speculative, it's mining. A bad day of rain can flood a mine out, a landslide can shut a mine down for years. And if you put all your eggs in one basket, then you create a situation where you're shouldering a lot of risk. So diversity is the easiest way to get rid of that risk. If you are more of a low-risk kind of person, you would want to get into one, for instance, like COPEX, which is the Global Copper Miners ETF. It's NYSDR.COPEX. They are more heavy on the producer side. So they're going to get more of the bigger names, and they're probably the absolutely safest foundational holding ETF. But then if you want a little bit more risk, you can go with a 50-50 mix of the high-end producers and the advanced developers. And if you wanted to do that, you would go for something like the iShares Copper and Metal Mining ETF, which is NASDAQ ICOP. They tend to blend more with producers and advanced developers evenly. If you're a little more risk-tolerant, you can go with something like Sprott's NASDAQ COP. So you look at Sprott, their Copper Miners ETF, they're more on the advanced developers' side and less weighted on the producers' side. As these mines develop, they will either merge together or they will merge with other producers. And the upside from those mergers can be best felt in the Sprott mix, which is more heavily on the advanced developers' side and a little lower on the producers' side. All right, these are great ETFs to consider. And for the first time ever, I'm going to add one of these ETFs to my purchase buys watch list. I pick a stock every video we talk about, and there's so many different names to look at in copper. A lot of great names here that you gave us, but I like that last one the best. The Sprott's ETF is the risk-tolerance that I'm looking for, but also gives it a little bit more balance. So if the one mine doesn't work out, it's balanced a little more. And I like that in mining stocks specifically, because sometimes you can have something go wrong with one mine and then that company doesn't do well. So I think there's a little bit of safety in an ETF. What are your thoughts on that quick, Jeffrey? I would agree with that. And I like the direction that the advanced development sector is going through. I think that very soon, let's say somewhere in the mid to late part of this year, these mines are going to start producing. Based on the mines that I follow, these mines are going to start producing. And when they do, you're going to see a lot of upside from the production, but you'll see even more upside as they start merging and getting acquired by major producers, which are also being held in your fund. Well, make sure to follow that Bridget Buys Watch list. You can scan the QR code or just go to marketbeat.com slash Bridget to see how these stocks we talk about on this channel are changing over time. And if you are interested in the rare earth minerals, the rare earth metals story, make sure to watch this list of some of the really interesting names coming out. This is another list of three different rare earth stocks to look at that's been very popular on our channel so far. If you haven't watched it yet, check it out.