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Gold and silver costs have been rising in latest months. Gold hit an all-time excessive of greater than $5,500 per ounce, and silver soared above $100 per ounce for the primary time.
enter FTSE100 miner, Fresnillo (LSE:FRES). The mining big primarily mines gold and silver in Mexico. Over the previous yr, the corporate’s inventory value has soared 430%. The common for the index was round 22%, which is excellent for a FTSE 100 inventory.
Previously 5 years, it has even surpassed rolls royce This can be laborious to consider contemplating the corporate’s energy post-pandemic.
FTSE100 prime performer
However can Fresniro proceed his meteoric rise in 2026?
Nicely, it depends upon whether or not the demand for gold and silver continues to extend. The rise in gold costs is pushed by central banks shopping for up the shiny steel, a weaker US greenback and geopolitical tensions.
In the case of silver, it tends to maneuver much more violently than gold. Some folks name it “steroids plus gold.” Like gold, silver can be seen as a secure haven in instances of uncertainty. However in distinction, it is usually highly effective in industrial functions. For instance, they’re utilized in photo voltaic panels, electrical autos, AI information facilities, and so on. These are all areas which might be anticipated to see excessive development within the coming years.
When valuable metals costs exploded previously, they might be extremely unstable. Costs can fluctuate considerably in each instructions. Within the brief time period, there could also be some profit-taking exercise.
That mentioned, many specialists count on medium- to long-term traits to push costs increased. Many main banking establishments are focusing on costs of over $6,000 for gold and $150 for silver this yr.
For Fresniro, its continued outperformance in 2026 stands out attributable to its direct ties to the commodity supercycle we’re presently experiencing. Fresniro delivered a strong efficiency in 2025, however latest downward revisions to 2026 manufacturing are inflicting some warning.
Taking part in with gold and silver
We stay aggressive as a low-cost operator, offering margin resilience and robust money movement era. A capital utilization ratio of greater than 17% signifies that capital is being correctly utilized. Additionally, the ahead price-to-earnings ratio of 30 is in keeping with historic averages throughout bull cycles. As a bonus, Fresnillo additionally provides a 2% dividend yield.
Nonetheless, needless to say if valuable steel costs reverse for an prolonged time frame, Fresniro’s inventory value may fall within the brief time period.
That is why I solely need to maintain it as a part of a balanced and diversified portfolio. FTSE 100 shares are usually massive, mature, established firms that do not typically obtain triple-digit returns.
However generally there are outliers. Over the previous yr, there have been six FTSE 100 shares which have returned greater than 100%.
It is unclear whether or not the identical factor will occur in 2026, however it’s actually doable. That being mentioned, even when valuable metals costs fluctuate within the brief time period, we consider long-term traits will proceed to assist them. That ought to bode properly for Fresniro in 2026.