When it comes to Canadian mining stocks, nickel companies are probably not the first to come to mind.
But in 2024, nickel is in high demand because it is a critical element in batteries as well as materials like stainless steel.
If you want exposure to sectors like electric vehicles, semiconductors, or solar panels, consider adding some of these best Canadian nickel stocks to your portfolio.
This article will discuss 7 of the best nickel stocks in Canada for April 2024.
Top Canadian Nickel Mining Companies
1. First Quantum Minerals
| Ticker Symbol | FM.TO |
| Market Cap | $19.66 billion |
| 52-Week Trading Range | $18.68 – $39.27 |
| Dividend Yield | 0.97% |
| 5-Year Performance | +39.96% |
First Quantum Minerals is one of the largest nickel companies in Canada. It mines a variety of different metals, including gold and copper, which makes up a majority of its revenues.
The company currently has two projects that produce nickel in Ravensthorpe and Enterprise which are located in Australia and Zambia respectively.
In 2023, First Quantum estimated it would produce between 28 and 38kt of nickel between the two sites. Given its diversification between nickel and cobalt, First Quantum should be heavily involved in the future of EV batteries in Canada.
2. Lundin Mining
| Ticker Symbol | LUN.TO |
| Market Cap | $7.32 billion |
| 52-Week Trading Range | $6.24 – $11.49 |
| Dividend Yield | 3.63% |
| 5-Year Performance | +17.16% |
Lundin Mining is another well-known Canadian mining company that produces a variety of different resources. These include nickel, copper, gold, and zinc.
The largest nickel mine under Lundin’s control is the Eagle Mine which is located in Michigan.
Lundin operates multiple other sites around the world including in Portugal, Brazil, Peru, and Sweden. Like First Quantum, copper accounts for a majority of the company’s revenues.
3. Sheritt International
| Ticker Symbol | S.TO |
| Market Cap | $196 million |
| 52-Week Trading Range | $0.31 – $0.65 |
| Dividend Yield | N/A |
| 5-Year Performance | -58.05% |
We move from two of the largest mining companies in Canada to a true nickel penny stock in Sherritt International. This Canadian nickel miner has been in operation since 1927 and is based out of Toronto.
Sheritt focuses on cobalt and nickel, two of the main components involved in the production of batteries. The company owns a partial stake in the massive nickel mine in Peru called Moa, where it anticipated producing 30,000 – 32,000 tonnes of nickel in 2023.
4. Nickel 28 Capital
| Ticker Symbol | NKL.V |
| Market Cap | $127 million |
| 52-Week Trading Range | $0.74 – $1.71 |
| Dividend Yield | N/A |
| 5-Year Performance | +256.41% |
Nickel 28 Capital is a Toronto-based company that deals in nickel and cobalt royalties. It is not a nickel miner although it does own partial stakes in multiple nickel mines around the world.
The company’s largest stake is in the Ramu nickel mine in Papua New Guinea. This project is mostly controlled by the Metallurgical Corporation of China. Nickel 28 also owns stakes in nickel mines across Canada and Australia.
5. FPX Nickel Corp
| Ticker Symbol | FPX.V |
| Market Cap | $117 million |
| 52-Week Trading Range | $0.35 – $1.71 |
| Dividend Yield | N/A |
| 5-Year Performance | +242.86% |
FPX Nickel Corp is another Canadian nickel penny stock that trades on the TSX Venture exchange. This company is based in Vancouver and has full ownership of the Baptiste project in Northern BC.
This site has the potential to be one of the world’s ten-largest nickel mines. FPX Nickel also claims to be the greenest nickel mining company in the industry, with low carbon emissions and non-acid generating host rock.
Other Nickel Stocks To Consider
6. BHP Group Limited
| Ticker Symbol | NYSE: BHP |
| Market Cap | $200 billion |
| 52-Week Trading Range | $46.92 – $71.52 |
| Dividend Yield | 9.49% |
| 5-Year Performance | +22.52% |
If you want to look outside of Canada for mining stocks, look no further than BHP Group, one of the world’s largest miners by market cap.
This Australian-based company has various nickel sites in Australia and sells over 85% of its produced nickel to battery suppliers. This includes an exclusive deal that it signed in 2021 with Tesla.
Another attractive thing about BHP is its massive dividend yield. This stock currently pays out a yield of 9.49% which equates to an annualized dividend of about $7.00 per share.
7. Vale SA
| Ticker Symbol | NYSE: VALE |
| Market Cap | $56 billion |
| 52-Week Trading Range | $11.72 – $19.31 |
| Dividend Yield | 5.23% |
| 5-Year Performance | -9.62% |
Vale SA is another massive international mining company that specializes in nickel. This Brazillian miner claims to be the largest nickel miner in the world, with 2023 guidance of over 160kt in production.
The company has deals with several battery suppliers as well as both General Motors and Tesla. In 2023, Vale planned to spin off its base metals segment from its iron ore operations in hopes of capitalizing on the high demand from EV battery makers.
What Are Nickel Stocks?
Canada ranks as the sixth-largest producer of nickel in the world. It should come as no surprise to Canadian investors as the country is known to be rich in natural resources and has a large mining industry.
Nickel stocks are companies that are involved in the discovery, mining, and production of nickel.
While nickel might be in high demand, it is also one of the most abundant elements on Earth. It has some beneficial traits, including being resistant to corroding, which is why it is widely used as a component of industrial metals.
How To Invest in Nickel Stocks in Canada in 2024
Nickel stocks that trade on the TSX are available at most brokerages in Canada, including discount brokerages like Wealthsimple and Questrade. Discount brokerages can help save on high-commission fees that are charged at most of the brokerages of the big Canadian banks.
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How To Choose Nickel Stocks For Your Portfolio
Given the wide range of nickel stocks in Canada, it is important to choose the right nickel stocks for your portfolio.
When investing in mining stocks, you should consider how many projects the company currently operates, as well as any further sites in development. This can ensure a future pipeline of nickel can sustain a company’s revenue and profit margin growth.
On top of that, looking at partnerships with major brands like Tesla shows that nickel miners will have a consistent demand for their products in the foreseeable future.
Downsides of Nickel Stocks
As with any sector, there are downsides to nickel stocks that you should consider. A majority of the surge in nickel demand has come from EV batteries. It is always a risk to invest in a sector where a majority of the demand comes from one product.
There also are not very many nickel stocks in Canada. Some of the best nickel stocks are actually US-listed companies, so Canadians will need to buy these stocks in US dollars.
Finally, nickel is a cyclical industry, which means that the supply and demand can fluctuate, as can the underlying price of the metal.
Methodology
Choosing the right nickel stocks can be a challenge for investors. Revenue growth and margins are a great place to start when analyzing a company’s fundamentals.
For growth investors, looking at emerging nickel miners might better suit your risk tolerance. Those seeking stability and a dividend will likely look at more established players in the industry.
As with any stock, researching the company behind it is critical to the success of your investment. Find companies with strong growth projections and are continuously expanding their business operations. For nickel stocks, this means companies that continue to seek out partnerships and expand their nickel mining footprint.
FAQs
The largest nickel producer in Canada is First Quantum Minerals, which has a market cap of nearly $20 billion. As of 2023, First Quantum is expected to produce as much as 38kt in nickel.
The top nickel-producing country in the world is Indonesia, which produces an estimated 1.6 million MT of nickel on an annual basis. Canada is the sixth-largest producer trailing Indonesia, the Philippines, Russia, New Caledonia, and Australia.
These days, the largest nickel buyers are EV battery makers. Some of the largest deals have been made between nickel miners and companies like Tesla and General Motors. Nickel is one of the key components of EV and rechargeable batteries.
The countries richest in nickel are Indonesia and Australia, which both hold over 21 million MT in nickel reserves. Canada is sixth on this list, with 2.2 million MT in nickel reserves as of 2023.
You can invest in nickel by buying nickel mining stocks in Canada, nickel ETFs, nickel futures contracts, or even physical nickel bullion, which comes in coins and bars.
