Miners Come Roaring Back

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In the classic movie Groundhog Day, Bill Murray is trapped in a loop. Repeating the same day over and over.

The news cycle feels like this lately.

President Trump announces a diplomatic breakthrough with Iran. Oil crashes, stocks rally, and Treasury yields fall. We’re saved!

Gold, silver, and miners tend to rally on these “we’re saved” days too.

Today was a good one. Gold rose $130 to $4,705/oz. Silver gained $4.25 to $77.87/oz.

Miners did even better, with the GDX gold miner ETF jumping 7.69%. The SILJ silver miner ETF spiked 8.9%.

Gold Miner Profits are Soaring

Newmont (NEM), the world’s largest gold miner, reported Q1 2026 earnings in late April (full disclosure: I own the stock). And there are some numbers in here worth reviewing.

The company produced a whopping $3.1 billion of free cash flow in Q1. They returned $2.7 billion of that to shareholders through share buybacks and dividends.

And on oil costs, the company reported that every $10 per barrel increases their all-in sustaining cost (AISC) to mine each ounce of gold by about $12.

I had expected more of a hit to earnings from the oil spike. This is a promising signal for the sector.

Still, high oil prices will be a weight on miners’ backs until the Middle East situation is resolved.

If it is solved soon, I expect a rapid return to full-on miner-mania. If oil can come back down to $70s (or lower), that’ll once again be a beautiful setup.

Silver + Silver Miners Looking Good, Too

Hecla Mining Company (HL) reported earnings yesterday. This company is primarily a silver miner, but also produces a fair amount of gold too.

Hecla produced $411 million of revenue in Q1 of 2026. That’s up 100% from Q1 2025, and up 13% over the previous quarter.

Other silver miners are also putting out excellent Q1 reports. That’s understandable considering the Q1 we had, when silver briefly raced over $100/oz. But overall, silver prices weren’t that much higher than they currently are.

Silver miner performance from here will largely depend on the price of silver, and to a lesser extent the price of oil.

Regarding silver itself, I still love it as a long-term investment. I’m not sure what the price will do over the next few months, but over the next few years I’m confident it will be far higher. The metal’s industrial uses are growing rapidly. And investor appetite is reawakening, particularly in China and India.

Gold or Silver?

The gold-to-silver ratio remains at historically elevated levels, meaning gold is still relatively expensive compared to silver. We’re currently at 61 (meaning gold is 61x more expensive than silver).

Here’s a 100-year chart of the gold-to-silver ratio.

Source: Macrotrends

I fully expect us to hit at least 30 on the gold-to-silver ratio at some point this cycle. At the current gold price, that would put us at $157/oz silver.

During previous precious metals bull markets, that ratio came down to as low as 15. A ratio of 10 to 15 was the norm throughout most of history up until the 20th century. That would give us an even better silver target. But let’s not get ahead of ourselves.

Overall, I continue to like the risk/reward for silver better than gold. However, it will be more volatile.

The fundamental story driving precious metals higher hasn’t changed. The debt bubble is still inflating. We’re simply witnessing the ebbs and flows of manic markets.

I’m not selling my precious metals. Because I know that more chaos lies ahead, and eventually I’ll be able to rotate these investments into more traditional assets at a much more favorable ratio.

In short, we’re not there yet.

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