The Motley Fool

Sirius Minerals plc isn’t the only stock with a promising future

Thanks to the huge volatility often experienced in the commodities markets, mining stocks aren’t for the faint-hearted. Nevertheless, those willing to take on more capital risk with their investments could see dramatic improvements to their wealth, so long as the companies they choose to buy continue to provide evidence that they are gradually bringing their projects to fruition. 

Thursday’s announcement that Sirius Minerals (LSE: SXX) had signed a ‘take or pay’ offtake agreement for the sale of its POLY4 product to one of the leading agribusinesses in South East Asia is a perfect example of the this.

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...

Once delivered, PT Chemical Indonesia — a subsidiary of Wilmar Group — will sell the polyhalite into territories such as Indonesia, Malaysia, Thailand and Vietnam, as well as using it within its own farming operations.

Clearly, having such a massive company as a customer won’t do Sirius’s profile any harm at all. The fact that the FTSE 250 miner will now be supplying “one of the fastest growing fertilizer regions in the world” should bring it to the attention of more potential buyers who may be tempted to agree on something similar to the seven-year deal (with the option of a further three years) made with Wilmar.

Having moved sideways for the last few weeks, I’m beginning to think it won’t be long before Sirius’s shares spring to life and get closer to the 60p price target agreed by numerous analysts. True, production is still a long way off but recent construction updates from the company suggest that everything appears to be on schedule and on budget — no small feat for a mining company.

Still a risky bet? Of course. As a stock to tuck away and forget, however, I think Sirius takes some beating.

High grade deposit

Investors looking for more exposure to the mining sector — but sensible enough to diversify their holdings — may wish to take a closer look at £47m-cap Horizonte Minerals (LSE: HZM).

It might be a market minnow, but Horizonte owns 100% of one of the largest and highest grade undeveloped nickel saprolite resources in the world – in the form of its Araguaia project in northern Brazil. When you consider just how much of the metal is likely to be required as electronic vehicles become increasingly common (not to mention the growing use of renewable fuel technologies such as wind turbines), that’s quite an asset to have in your possession.

Last week, the company submitted its application for a mine construction licence to SEMAS (the Par State authority responsible for environmental licencing) — “a major milestone“, according to CEO Jeremy Martin.

With a fully-funded feasibility study of the Araguaia project now due for completion in Q1 next year, it wouldn’t be surprising if Horizonte began to hit more investors’ radars, particularly given the hugely attractive economics of the project. Once in production, it has been suggested the company could be one of the lowest cost producers around, generating $1.3bn in free cash flow over the mine’s 28-year life, based on a nickel price of $12,000 per tonne.

A further positive to Horizonte is the strong institutional backing the company has. With investors including Glencore and JP Morgan, you can be fairly certain that raising finance to construct the mine won’t be an insurmountable obstacle.

“This Stock Could Be Like Buying Amazon in 1997”

I'm sure you'll agree that's quite the statement from Motley Fool Co-Founder Tom Gardner.

But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.

What's more, we firmly believe there's still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.

And right now, we're giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool.

Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge!

Paul Summers owns shares in Sirius Minerals. 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.

Where to invest £1,000 right now

Renowned stock-picker Mark Rogers and his select team of expert analysts at The Motley Fool UK have just revealed 6 "Best Buy" shares that they believe UK investors should consider buying NOW.

So if you’re looking for more top stock ideas to try and best position your portfolio in this market, then I have some good news for your today -- 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 enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.