Precious metals have started 2026 as they left off in 2025. Rocketing higher! Silver started the year just above $70 per ounce and it’s now close to $90. Gold entered 2026 at around $4,300 an ounce and is now close to $4,600. I’ve mentioned before that I think we’re in the middle of a commodities boom period. Here are a couple of FTSE shares that can provide exposure to this theme.
Large operational leverage
First up is Endeavour Mining (LSE:EDV). It’s one of the largest gold producers in West Africa, with core operations in places like Côte d’Ivoire and Senegal. Naturally, the gold that it produces is worth a lot more now than it was a year ago. This is reflected in the share price’s 171% gain over the past year.
This rocketship has outpaced even the move higher in the precious metal. This is because the company benefits from operational leverage. What I mean is that with elevated prices, its cash flow and earnings improve because the increase in revenue isn’t always matched by equivalent increases in costs. If the price of gold jumps 10% tomorrow, revenue rises by 10%, but mining costs haven’t changed.
Of course, the risk is that if the gold price crashes in the future, Endeavour’s fixed costs will be hard to cut. So that’s where the firm could lose money. This volatility and uncertainty are why some investors are very cautious about buying commodity stocks. Yet, from my perspective, gold could keep rallying amid geopolitical uncertainty, lower interest rates, and investor demand for a safe haven.
Endeavour is well set to further capitalise on any price increase, with a diversified portfolio of producing mines and growth projects in West Africa. This is a good mix of existing revenue generators and new potential options.
The silver giant
Another idea is Fresnillo (LSE:FRES). It’s widely regarded as the world’s largest primary silver miner, while also producing gold. As a result, it has benefitted from the move in silver prices, again via the operational leverage I spoke of earlier. Thanks to this, the share price is up a whopping 486% in the last year.
The interim financial results from last summer showed a 160.7% surge in gross profit. When the full-year results come out, I’d expect profit to have increased even further, given the rise in precious metals prices since then. Income investors are also driving the share price due to increased dividend payouts. For example, the interim results confirmed a dividend of $0.208 cents per share, totalling $153.3m. For perspective, the dividend from H1 2024 totalled $47.2m.
Looking ahead, the company is well-positioned to continue growing if gold and silver continue to rise. Due to Fresnillo’s size and scale, it can capture a large share of the benefits from rising prices.
The company now has a price-to-earnings ratio of 139. This is very high and could reflect an overvalued stock at risk of a correction. Another concern is the large exposure it has to Mexico, which is subject to regulatory, tax and political uncertainty.
Even with that worry, I think both stocks could do well if precious metal prices keep soaring. Therefore, they could be worth considering for investors looking for exposure to this theme.
