Shares of Hudbay Minerals Inc. (TSX:HBM) have been on a bumpy ride of late, generally trending in a downward direction based on global expectation for key commodity prices of various minerals mined by the Canadian company (primarily copper, gold, silver and zinc).
Despite the year-to-date decline of nearly 17%, Hudbay has experienced relatively strong insider buying of late, indicating to the market that shares of the out-of-favour mining concern may be on the brink of a rebound.
As with many other mining companies, the stock chart of Hudbay looks quite similar and follows a very similar correlation to the stock price trends of many other major North American mining companies over the past 10 years.
With global commodity prices sustaining low levels for some time now, many mining companies have simply fallen out of favour with the market, and many investors are loathe to consider investing in the industry in general, due to the perception of low growth prospects for some time to come.
Slowing global growth and relatively stable demand have not been kind to Hudbay, a company reliant on robust global economic growth to sustain higher profitability levels. The company’s trailing 12-month earnings remain negative, and investors have largely steered clear of the sector in general, looking to other industries for growth amid weakening commodity prices worldwide.
With recent insider buying trends picking up with companies such as Hudbay, value investors will likely be interested in taking another look at this company and the sector in general.
Invest wisely, my friends.
