The Motley Fool

These 2 FTSE 100 winners can maintain their explosive growth

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

The following two companies have enjoyed an explosive start to 2016. Can they keep up the pace?

After the gold rush

Mexican-focused silver and gold miner Fresnillo (LSE: FRES) is the brightest stock of 2017, outpacing the entire FTSE 100 to grow 27.4% in the first three months. The prospector’s share price has been driven by the surge in silver and gold prices, and further turbo-charged by the slump in the Mexican peso. US president Donald Trump is at the heart of both of these trends.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

Precious metals prices have soared as the Trump honeymoon ends and nervous investors seek safety: gold is up 4.46% in the last 30 days, while silver is up 7.39% (Fresnillo is the world’s largest primary silver producer). The peso was hammered by Trump’s talk of walls and tariffs, falling 11% the day after the election, good news for Fresnillo as two thirds of its costs are peso-based. 

Shine on

This isn’t just a Trump play. Fresnillo’s share price is up 75% over the past year, and 130% over two years. Last year it delivered record silver production of 50.3m ounces, while gold production of 935,500 ounces exceeded revised guidance. Adjusted revenues leapt 29.2% to $2.045bn and EBITDA profits soared 88.5% to $1.032bn, helped by cost reductions and productivity improvements.

Fresnillo continues to climb despite the recovery in the peso, following hints that the Trump administration isn’t planning a wholesale rewriting of the NAFTA free trade deal between the US, Canada and Mexico. Strong company management, global political uncertainty (which always props up precious metals), and forecast earnings per share growth of 22% this year and 36% in 2018 suggest that Fresnillo should continue to shine. However, it looks pricey at 44.4 times earnings.

Red hot Chilean miner

Chile-focused copper miner Antofagasta (LSE: ANTO) has also been rampant in 2017, its share price up 25% so far. Again, this continues a trend, as the share price has more than doubled in the past year. 2016 was a year of “operational delivery“, according to chief executive Iván Arriagada, with a 12.5% rise in copper production to 709,400 tonnes. It has also been helped by the restoration of King Copper, after the dark days of exile in 2015 and early 2016, and the across-the-board resurgence in commodity stocks as fears of a Chinese meltdown abate.

My concern is that the world’s biggest consumer of commodities is only kept on course by yet more unsustainable, bubble-inflating stimulus from the Chinese authorities. What cannot go on forever must one day stop. However, Antofagasta has worked hard to boost productivity, improve efficiency and reduce costs, with sustainable reductions of $176m last year. This helped boost cash flow from operations by 70% to a healthy $1.5bn, and fund dividend progression.

Lifecycles

As Arriagada points out, Antofagasta operates in a cyclical industry, but its cautious approach has given it a stable operating base and strong balance sheet. Again, the recent price surge leaves it trading at an expensive 31 times earnings, but with forecast EPS of 38% this year and 14% in 2018, and spirits rising in the global economy, this high price may still be right.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!

Harvey Jones has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.