3 Mining Stocks to Buy on an AI Boom VIEW IN BROWSER Tom Yeung here with your Sunday Digest. 
The Statue of Liberty, pictured above, is instantly recognizable. This 22-story, copper-clad monument – gifted by the people of France – was the tallest structure in New York City when it was completed in 1876. If you’ve ever seen it up close, its sheer size and grandeur are unmistakable. Now, imagine every city, town, and village in America receiving 15 of them. And imagine that happening every year. Because that’s how much copper the world produces annually. The metal is one of the best conductors of electricity (second only to silver), and three-quarters of the 26 million metric tons mined annually find their way into electrical wiring. Even the most basic electronic device wouldn’t exist without it... never mind 305-foot-tall statues. That’s why copper was such an essential element during the Internet Revolution of the 1990s. Internet service providers laid thousands of miles of wire to link houses together, and the U.S. saw its copper consumption rise 20% to 2.62 million metric tons between 1990 and 2001. That happened even as heavy manufacturing moved abroad. The development of artificial intelligence has now put dozens of other materials on the map. Rare earth metals have become the new bargaining chips of the U.S.-China trade war, and even unexpected ingredients are becoming hard to find. Helium-filled balloons, for instance, have become rarer at birthday parties since the gas is also used in advanced semiconductor manufacturing. On Wednesday, July 9, at 8 p.m. Eastern, Louis will be holding a special presentation to share the opportunities he’s seeing in copper again. (Click here to automatically register for the event.) In the meantime, I’d like to offer three of my own suggestions to play the AI metals boom... | Recommended Link | | | | The briefing Louis Navellier just recorded from his Palm Beach estate may be the most important of his entire career. Because what he’s seeing right now isn’t just another market correction. It’s something far more profound. And it starts with what President Trump’s new tariffs and the DOGE initiative are really setting in motion. What looks like routine policy is actually the catalyst for the most aggressive wealth transfer in modern American history. This isn’t about politics. It’s about your financial future. Click here to view this urgent message now. |  | | The Slow Turnaround: Albemarle Corp. (ALB) There's an old Wall Street saying, “no one rings a bell at the top of the market.” It’s equally true for buying at the bottom. Struggling firms can drop double digits during a selloff... only to keep going down as more issues are revealed. It’s why there’s another saying on the Street that a stock that’s lost 90% of its value is one that first dropped 80%, then proceeded to lose another 50%. That’s what makes lithium mining stocks so tricky to buy. Over the past several years, Chinese lithium miners have flooded international markets with new supplies, pushing prices of the metal down by 80%. We’re now entering our third year of this glut, prompting at least one American official to suspect intentional market manipulation: "They engage in predatory pricing, said Jose Fernandez, undersecretary for economic growth, energy and the environment at the U.S. Department of State last year. "[They] lower the price until competition disappears. That is what is happening." Chinese overproduction is expected to last through at least the end of this year, if not longer. However, patient investors will want to consider an investment in Albemarle Corp. (ALB), one of the largest and lowest-cost lithium miners in the world. The selloff has now pushed prices to a multi-year low of 0.8X book value, a third of its long-term average. The Chilean-based firm produces lithium through salt brine assets in Chile and the U.S., as well as through two joint ventures in Australia. Even at today’s depressed prices, analysts expect ALB to comfortably generate 20% EBITDA margins and positive free cash flow. It should be able to fund its dividends at 2022 levels, where they were before the lithium price crash. In addition, the dash for AI resources has put utility-scale batteries back on the drawing board. AI data centers require enormous amounts of backup power, and their operators have turned to almost every imaginable technology to provide that need. That includes nuclear power… diesel generators… and of course, lithium-ion batteries. Alphabet Inc. (GOOGL) has now installed 100 million lithium-ion cells across its data centers, and other tech giants have contracted with third parties for similar services. Companies are also understandably worried about buying Chinese-made lithium-ion batteries. No American tech giant wants to be seen cozying up to China in the current political environment, so Albemarle should eventually benefit as more Americas-based lithium processing plants are built. Though ALB's story may take several years to play out, it could be worthwhile to get back in now since no one ever rang the bell at the bottom of the market either. The Risky Play: Plug Power Inc. (PLUG) In 2022, I warned that many green energy moonshots had become stocks to skip entirely. High valuations and inflated expectations meant companies like QuantumScape Corp. (QS) and Plug Power Inc. (PLUG) were simply not worth the risk. [My] core list passes over green energy moonshots like battery developer QuantumScape (QS) and hydrogen mobility firm Plug Power (PLUG), despite their potential to go 10x. Instead, this newsletter’s lone energy pick is Schlumberger (SLB), a company that has avoided losing two-thirds of its value in the past year, unlike its flashier peers. Over the following year, these two moonshots saw their stocks fall 38% and 48%, respectively, proving that not every green energy story plays out. Meanwhile, my conservative pick of SLB would gain 65%. Yet, Plug Power’s additional drop of 84% (bringing its total decline to 91%) has turned the green hydrogen firm into a potentially lucrative bet. Shares trade at just $1.40, down from $18 when I first recommended skipping the stock. We're also seeing a reversal in PLUG’s fortunes: - Revenues are rising. Analysts expect a 16% rise in revenues this year, stemming from the 29% decline seen in 2024.
- Costs are falling. The company opened its Vista Manufacturing Facility in 2023, and is finally gaining economics of scale. Operating losses are expected to decline by three quarters this year.
- Order books are filling up. Plug Power has roughly 8 GW of BEDP Contracts (discussions that have moved to the engineering and planning phase), up from 4.5 GW last year.
The reason for this growth is artificial intelligence. Earlier last year, Microsoft Corp. (MSFT) announced it would begin testing hydrogen fuel cell technology at its data center in Dublin. The 250kW?project is enough to supply roughly 200 homes. Alphabet, IBM (IBM) and others have also explored these possibilities. Plug Power should benefit, given its early lead in the industry. Perhaps most compellingly, PLUG’s shares have become so cheap that its chief financial officer has begun scooping up shares on the open market. Since mid-May, Paul Middleton has bought 1 million of PLUG stock in the $1 range, boosting his stake to 2.6 million shares. This is one of the most bullish predictors for future gains. So, even though Plug Power remains a highly speculative bet, its dreams of becoming a fully integrated supplier of hydrogen fuel to the AI industry has suddenly made it a company worth revisiting. Bonus Speculative Pick: USA Rare Earth Inc. (USAR) I’m generally no fan of the backdoor listings known as SPAC mergers, especially during lockup periods. These speculative firms are generally too weak for a regular IPO and are often a sign that insiders want to cash out. The average SPAC merger since 2012 has lost 56% of its value in the first year. That’s why I’d like to propose this week’s final stock only as a firm to keep on your watchlist. It's an incredibly compelling story in the rare earth materials of the AI Revolution... but also one with significant downside risks. The company is USA Rare Earth Inc. (USAR), one of two key players in the American heavy rare earth minerals market for magnets. The firm plans on building a rare earth magnet manufacturing facility in early 2026 and owns a significant asset in Texas called Round Top, which recently produced a sample of dysprosium oxide with a purity of 99.1%. The mineral is a key component in semiconductors as well as in neodymium rare earth magnets used in electric vehicle motors and wind turbine generators. Other deposits at Round Top include gallium, hafnium, beryllium and zirconium. That makes USAR a potential 5X winner. The U.S. currently relies on China for roughly two-thirds of all rare earth minerals, and China has recently used these metals as a bargaining tool in trade negotiations. Regulators will doubtlessly allow expedited permitting for rare earth metals mining, especially in a Republican-controlled state like Texas. Analysts expect USAR to generate $39 million in revenues next year, and then $166 million in 2027, up from zero today. The firm could break even as early as 2028. However, it’s important to note that USAR has a lockup policy that allows insiders to sell up to 50% of their holdings within the first year. (Most SPACs have a more restrictive 0% rule for the first six months.) That will keep pressure on shares until at least May 2026. Mining startups are also inherently risky, as the struggles of fellow Round Top producer Texas Mineral Resources Corp. (TMRC) has shown. The older firm failed to discover meaningful resources when it explored the region in 2014 and now trades over-the-counter as a penny stock. So, keep USAR on your radar, but be sure to wait for a very attractive price before jumping in. The Metals Boom Just now, I mentioned that USAR is one of two major American firms making rare earth magnets. The other is far more established. The company did its own backdoor listing in 2020, saw its expected short-term selloff, and then proceeded to rise 3x as government contracts began rolling in. It’s now a $5 billion company that could see revenue triple to over $600 million by 2027. Louis will reveal the name during his special presentation next Wednesday, July 9, at 8 p.m. Eastern – for free. If you want to learn the details, make sure to reserve your spot for his event now (click here for instant registration). Until next week, Tom Yeung, CFA
Market Analyst, InvestorPlace | 
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