2 Silver Miners To Buy On The Dip

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Although the precious metals market plummeted this month, the victim of a recent surge in U.S. bond yields amid fears around the potential for a spike in inflation, the outlook for silver remains very encouraging given an improving macroeconomic backdrop and higher industrial demand.

Last month, silver hit its highest level since February 2013, spurred by day-trader activity following the GameStop (GME) short squeeze. While the price of silver has since declined, analysts believe the precious metal could climb again in the coming months.

With the increasing penetration of 5G networks and other advanced technology in the consumer electronics industry, coupled with more installations of new photovoltaic capacity and the increasing electrification of vehicles, silver which has applications in all these industries, is expected to resume its rally soon on soaring demand from these sectors. Investors’ optimism about the sector is evident in iShares Silver Trust ETF’s (SLV) 105.6% gains over the past year. SLV has declined 3.9% over the past month.

With this, we think it may be the perfect time to buy the dip in Silvercorp Metals Inc. (SVM - Get Rating) and Great Panther Mining Limited (GPL - Get Rating). They have strong balance sheets and solid business models.

Silvercorp Metals Inc. (SVM - Get Rating)

Based in Vancouver, Canada, SVM  acquires, explores, develops, and mines mineral properties in China. It mainly explores silver, gold, lead, and zinc and holds an interest in the Ying silver-lead-zinc project and GC silver-lead-zinc mine in China.

Last month, the company received a Tieluping-Longmen Mining License renewal and extension for the TLP, LME, and LMW mines in the Ying Mining District. This license renewal demonstrates the company’s strong performance over the past years and its commitment to operating to the highest safety, health, and environmental protection standards.

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