Topic: How To Invest

Pat: What do you think of HudBay Minerals? They seem to be one of the few base-metal mining companies turning a profit at today’s prices. Thanks.

Article Excerpt

Low resource prices and tight credit have hit junior-mining stocks particularly hard. The group needs much higher commodity prices for an across-the-board rebound. These companies must also have considerably easier access to both equity and debt financing. We continue to recommend a number of high-quality juniors in Stock Pickers Digest. But, as always, we judge them using the same factors we’ve always used to find the best junior-mining stocks. These include: 1) Well-financed junior miners with no immediate need to sell shares at low prices, since this would dilute existing investors’ interests. The best junior miners have a major partner who has agreed to pay for the drilling or other exploration or development in exchange for an interest in the property. 2) Mining stocks with strong balance sheets and low debt. We also want to see positive cash flow, preferably even when commodity prices are low. 3) Even better, we like to see mining stocks that have cash flow from an existing mine…