We recently published a list of 7 Best Zinc Stocks to Buy According to Hedge Funds. In this article, we are going to take a look at where Sibanye Stillwater Limited (NYSE:SBSW) stands against other best zinc stocks to buy according to hedge funds.

Zinc is a vital part of modern industry and plays a major role in galvanizing steel to produce alloys and promote sustainable energy storage. Construction, automotive, healthcare, and even dietary supplements are among its many uses.

Zinc’s importance is on the rise with a renewed focus on sustainable manufacturing, an increasing number of electric vehicles (EVs), and the growth of infrastructure projects. The Business Research Company has reported that the global zinc market will develop significantly. It is expected to rise from $28.82 billion in 2024 to $41.76 billion by 2029, with an annual growth rate of 7.6%.

The market trend further highlights zinc’s upward surge. Over the previous year, zinc futures have risen by 19.63%, increasing from $2,405 per metric ton on February 18, 2024, to $2,877 on February 19, 2025. Refined market fundamentals and investor trust have driven this expansion. In 2024, zinc production stood at 20 million tons, while its consumption stayed consistent at 19 million tons. China, Peru, and India continue to be the lead producers of the metal. However, global trade patterns have shifted, leading to an 11% drop in zinc imports, bringing it down to 4.2 million tons. After continuous growth of two years, exports also showed a decline of 8.5%, down to 4.6 million tons. This decline was mainly caused by a deceleration in the EV market, as vehicle manufacturers started experimenting with other materials. Furthermore, the shift to green energy momentarily disrupted conventional supply chains, leading to variations in zinc trade.

Regardless, zinc demand remains steady in the main industrial sectors. The U.S. and China held their position as the lead importers of the metal during the year. In 2024, it was reported that the USA imported almost 589,000 tons of zinc, making up 14% of total imports, while China imported 441,000 tons, contributing to 11% of total imports. This shows how zinc still plays a key role in infrastructure, the automotive sector, and technology advancements.

As the globe transitions to a low-carbon economy, zinc is becoming a vital facilitator of decarbonization with coatings alone, accounting for 60% of global zinc consumption. The International Zinc Association (IZA) forecasts a 22% increase in zinc demand from the automotive sector, which amounts to an additional 140,000 tons by 2030. This expansion is fueled by the increasing automobile sales in China and India, the surging preference for larger vehicles, and the increased utilization of galvanized steel in electric vehicle manufacturing.

Beyond the automotive industry, zinc’s demand is also increasing in renewable energy. According to Zinc.org, by 2030, solar power infrastructure will require approximately 568,000 tons of zinc, as zinc-coated steel becomes essential in solar arrays and wind turbines. Meanwhile, zinc is increasingly influential in agriculture due to the Zinc Nutrient Initiative (a program with the aim to add zinc fertilizer to soils to significantly increase crop yield, and boost nutritional value in humans), which has created an annual need of 400,000 tons for fertilizers. Moreover, the increasing popularity of zinc-based dietary supplements is boosting market demand.

In parallel, technological progress in zinc recovery and recycling is moving the industry toward sustainability. Innovations in direct leaching and submerged lance technology are improving extraction efficiency while minimizing environmental impact. A significant advancement, named Kobe Steel’s FASTMET process, has achieved a remarkable 95% recovery rate of zinc from steel mill waste and industrial by-products. These innovations are transforming waste into recyclable resources, fostering a circular economy that encourages zinc’s sustainability in the long run.

As the industry progressively emphasizes sustainability, zinc’s significance in infrastructure, energy, and agriculture continues to grow, offering profitable prospects for investors.

Methodology

To compile our list of the 7 Best Zinc Stocks to Buy According to Hedge Funds, we first conducted extensive research to identify companies with significant exposure to the zinc industry. We define exposure in terms of zinc mining, refining, or the production of zinc-based products.

We then extracted the number of hedge fund holders having a stake in the respective companies, as of Q4 2024, using data from Insider Monkey’s hedge fund database. The finalists are stocks with the highest hedge fund interest.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Sibanye Stillwater Limited (NYSE:SBSW)

Number of Hedge Fund Holders: 18

Sibanye Stillwater Limited (NYSE:SBSW) is a global mining company that operates in South Africa, the U.S., Europe, and Australia. It is recognized primarily for its production of gold and platinum group metals (PGMs) such as palladium, platinum, and rhodium. In June 2023, it made a considerable move into the zinc sector by obtaining Australia-based New Century Resources, enhancing its foothold in battery production and industrial metals markets.

These developments are already yielding positive results, with the company’s Australian operations producing approximately 82,000 metric tons of payable zinc in 2024. Despite facing operational hurdles, this was an advancement over the previous year. The increase in zinc prices, averaging $2,800 per metric ton, along with reduced treatment charges of $148 per metric ton, contributed to enhanced profitability. As a result, adjusted EBITDA for the region turned positive at $34 million, recovering from a loss in 2023. This shift was primarily influenced by consistent production following weather interruptions earlier in the year. However, costs rose by 17% to around $2,300 per metric ton due to higher royalties and maintenance capital investments.

Despite these improvements, declining PGM prices impacted Sibanye Stillwater Limited (NYSE:SBSW)’s overall financial results. For the year ending December 31, 2024, revenue declined by 9%, although adjusted EBITDA remained stable at $360 million. The company secured a $500 million streaming agreement with Franco-Nevada to counter tighter margins and reinforce its financial position. This will allow the company to improve its value while simultaneously reducing its debt load.

Despite these financial modifications, Sibanye Stillwater Limited (NYSE:SBSW) continues to be firmly committed to its fundamental assets. The Franco-Nevada deal ensures that the company holds significant exposure to platinum and palladium prices, preserving its influence in the PGM market. Furthermore, it is actively expanding its renewable energy capacity, with 407MW of projects under development. This strategy is expected to decrease dependence on grid electricity and lower long-term operational costs, further enhancing the company’s sustainability efforts.

Sibanye Stillwater Limited (NYSE:SBSW) is focused on driving its Australian growth strategy forward. With ongoing feasibility studies for the Mount Lyell copper project and phosphate development, along with an emphasis on cost management and base metals expansion, the company is establishing itself as a major player in the zinc sector and beyond. As it continues to progress, Sibanye Stillwater Limited (NYSE:SBSW) is demonstrating its significant influence in shaping the future of the global zinc sector.

Overall, SBSW ranks 7th on our list of best zinc stocks to buy according to hedge funds. While we acknowledge the potential of SBSW as an investment, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than SBSW but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.