Dear subscriber,
This year, investing has been about one single thing: artificial intelligence ("AI").
And this month, the AI story is starting to crumble. The tech-heavy Nasdaq Composite Index is off by about 6%.
We've covered the reasons why AI may struggle at length in these pages... and done so ahead of the recent downturn.
So rather than recap the old news, let's forget all the hot tech stocks making headlines (at least for a moment)...
Instead, I want to highlight a better opportunity that you may have missed in the AI hype.
It's boring... at least compared with the excitement of generating intelligence from software.
But it's profitable. And I believe it's only going to get more so for three specific reasons.
Here's the deal...
We, as a nation, are dramatically short of metals and minerals.
That's a big claim. You may see headlines saying we're short of copper or zinc or some other oddball metal you've never heard of, like lithium or even antimony. But this is bigger than a quirky little shortage.
We're short them all. And that's powering the shares of the mining stocks that pull these commodities out of the ground higher.
The SPDR S&P Metals and Mining Fund (XME) – which tracks the U.S. industry – has rocketed from less than $50 per share to more than $100 per share this year...
But this isn't a bump or a blip.
As I'll get to in a moment, there are three long-run reasons these stocks are soaring. And these tailwinds are likely to power earnings (and share prices) higher from here.
When it comes to AI, you could say that most rising AI investments are powered by hype. The hype may be justified, but earnings for most parts of the AI ecosystem simply aren't there.
The metals and mining industry, on the other hand, makes real money. And even after this recent move higher, XME only trades at 17 times next year's earnings.
That's cheaper than the broader market. (And it's skewed by the fact that plenty of miners are in development and not yet profitable. But there are profitable ones to invest in.)
If you look at that chart above again, you can see that the U.S. metals and mining industry's return was roughly flat from 2010 to 2024. And that's during an era of booming markets, low interest rates, and strong economic growth.
As an investment, mining stocks had been left for dead. No one wanted to touch them.
And that leads to the first reason that mining is back...
Decades of No Investment
No one wanted to invest in mining. That left the industry short on capital. And therefore mining companies didn't invest in new projects.
Again, we're talking about all kinds of metals. But the starkest example here is copper. The number of major copper discoveries dropped from around a dozen per year prior in 2010... to flat out zero today...
If you haven't noticed, we still use tons of copper.
It's in everything from kitchen sinks and doorknobs to musical instruments and electrical cords.
But mines are getting older and hold lower-grade deposits. Eventually, the holes go empty.
It's a similar story for all metals today.
And again, this doesn't mean that we're running out of metals to mine... just that miners have stopped investing in new mines.
The top 40 global mining companies have invested about $70 billion per year in capital expenditures over the past decade. That sounds like a lot of money... but it's less than Americans spend each year on food delivery.
Put simply, we have a shortage because we haven't been spending to find metals. That will drive the prices of metals and minerals up... and the shares of related stocks will rise in kind.
Moving on to the second reason mining is about to boom...
A New Industrialized World
The way the industrial world works is changing.
Nations have decided they want to produce more goods in their own countries. We no longer want to get all of our semiconductor chips from Taiwan... or all of our rare earths from China.
So we're building new factories, new mines, and new chip foundries at home.
There's more...
We're electrifying... moving from fossil-fuel energy sources to a grid run by electricity. That requires more power lines, more power plants, and more solar cells... which require vast amounts of metals and minerals.
Not to mention, electric-car use is on the rise, and these vehicles take immense amounts of metals and minerals for their batteries. The same can be said for the massive data centers we're building.
All this means... we need more.
The great machinery of global production is gearing up to gobble more critical metals and minerals in pursuit of a new way of producing in the world.
And it's only going to drive demand up for mining companies.
That's why we're starting to see some involvement from the government – the third driver of mining stocks today...
The Government Has Flipped Sides
The U.S. government used to stand in the way of mining.
Mining is dangerous and dirty. And from permitting to environmental reviews, the endless red tape has halted projects for decades.
Now, the government has decided it wants to drive mining projects forward rather than restrict them.
It has taken stakes in and cut deals with mining companies that it deems critical to national security.
MP Materials (MP), Lithium Americas (LAC), and Trilogy Metals (TMQ), for instance, all got sweetheart deals from the government as it looks to encourage production.
And their shares have rocketed higher as a result...
These stocks cooled a bit after the initial excitement. But the returns here are impressive... and there's likely more of these deals coming.
That said, you don't need a U.S. government deal for these stocks to take off (though it does help).
Even the major global mining companies are on the rise. And these moves appear more sustainable. Look at Brazilian iron ore and copper miner Vale (VALE) or British-Australian mining giant Rio Tinto (RIO)...
The market has been a one-note story for the past several years, with the AI frenzy driving returns.
Mining stocks look to be the second-biggest story of 2025... and perhaps the biggest of 2026.
So make sure you keep this industry on your radar. Countless opportunities to invest in undervalued mining stocks are bound to present themselves – and the upside could be huge.
The Stocks That Save America Summit
The mining industry makes it difficult on investors. Financial statements don't give the full picture of what's down in the hole... and what it's going to cost to get it out.
That's why, in mining, it's all about who you know.
At Stansberry Research, we partnered with Nick Hodge and Rick Rule... two guys who know more about investing in metals and miners than just about anyone in the world. (And believe me – that's not a stretch.)
Recently, they prepared a special presentation to explain just how big this opportunity is... and to outline some of the stocks that have already been exploding higher.
To hear more about the recent action in metals and mining, check out today's This Week on Wall Street video.
You can watch the entire episode on our YouTube page by clicking the image below. Be sure to like and subscribe to get more of our videos.
What Our Experts Are Reading and Sharing...
- The market was holding its breath for Nvidia's (NVDA) earnings... even though it was obvious the hyperscalers hadn't slowed their spending from their own announced plans. Nvidia's earnings came in just fine. No surprise despite the hype. But it wasn't enough to turn around tech stocks this week.
- I recently told you yields on government bonds around the globe were heading higher. Well... Japan just joined the party, with a huge surge in government bond yields, as investors sell off government debt.
- I (also) told you not to let private equity touch your 401(k). Now, here's Nick Maggiulli from the blog Of Dollars And Data explaining very clearly that the push to get private equity into regular investors' portfolios is because they need someone to offload investments on to – not because they want to bring you higher returns.
New Research in The Stansberry Investor Suite...
Side hustles... The "gig economy"... Whatever you call it, the American labor market is changing.
It's not easy to find a job. It's not always easy to make ends meet. And lots of people just don't like working for a boss.
Whatever their reasons, more than 60 million people now take part in the broader gig economy in the United States.
And in this month's Stansberry Innovations Report, John Engel and the team dig deep into the financials of one particular gig-economy stock.
What they find may surprise you... One ride-share company, after years of operating in the red, is finally profitable.
It's even producing real free cash flow.
As the Innovations Report team explains, more than 1.5 million people drive for ride-sharing platforms these days.
And these aren't just side hustlers. They're a new working class that's large and politically connected.
The ride-share industry of the 21st century has weathered lawsuits, strikes, and local crackdowns. Now, it's finally profitable and growing.
And one underdog – a pure-play platform focused entirely on ride-sharing – is in an ideal position for breakout growth. While its main competition is diversifying into delivery and freight, this company is doubling down on its core market.
It doesn't need to conquer the world to deliver substantial upside for investors. It just needs to be the best at what it does in the markets that matter most. John and the team will show you how it's making that happen, the macro tailwinds at its back, its avenues for international growth, and its recent flip to profitability.
Stansberry Investor Suite subscribers can read the entire report here.
If you don't already subscribe to The Stansberry Investor Suite – and want to learn more about our special package of research – click here.
Until next week,
Matt Weinschenk
Publisher and Director of Research
What do you think about This Week on Wall Street? Send any and all feedback to thisweek@stansberryresearch.com. We read every e-mail you send in.
