--- title: "Current Valuation Comparison of Non-ferrous Stocks" type: "News" locale: "zh-HK" url: "https://longbridge.com/zh-HK/news/271606618.md" description: "The performance of non-ferrous stocks has been outstanding in the price surge of the second half of the year, especially lithium mining stocks, which are facing valuation pressure. Although the market has a bullish outlook for non-ferrous metals in 2026, the valuation differences between different metals will affect future price increases. History shows that cyclicality still exists, and the current high prices may lead investors to be at the top of the cycle. Attention should be paid to the fluctuations in lithium prices and their impact on related stock prices. Overall, the investment value of precious metals is gradually increasing" datetime: "2026-01-06T05:35:28.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/271606618.md) - [en](https://longbridge.com/en/news/271606618.md) - [zh-HK](https://longbridge.com/zh-HK/news/271606618.md) --- > 支持的語言: [简体中文](https://longbridge.com/zh-CN/news/271606618.md) | [English](https://longbridge.com/en/news/271606618.md) # Current Valuation Comparison of Non-ferrous Stocks The non-ferrous sector has emerged strongly in the price surge of the second half of the year, rivaling the AI sector. The core driver is naturally the price increase leading to performance growth, especially as various metals have broken new highs by the end of the year, indicating higher expectations for 2026. For non-ferrous stocks, historical data shows that cyclicality still exists. The prolonged high price period has led many to believe that prices can be maintained indefinitely. Now, with rising prices, expectations for continued increases in the coming years may leave some investors stuck at the peak of the cycle. For instance, there are many discrepancies regarding lithium prices currently; the performance of many lithium mining stocks has not kept pace with the rise in futures prices, as their valuations based on current high prices are not considered cheap. The outlook for non-ferrous metals in 2026 is bullish. However, there are distinctions among non-ferrous stocks, and the key factors determining next year's price increase potential, aside from the extent of price increases, also lie in valuations. This means that for some non-ferrous metals, a small increase in 2026 may fall short of expectations, while for others, a small increase could exceed expectations. The former could see significant declines, while the latter could experience substantial gains. Therefore, it is essential to clarify the valuation differences among major metals to prepare for the upward potential in 2026. 1. The upward expectations are sufficient, but the logic is not solid. Looking back at 2025, most non-ferrous metals experienced price increases, with cobalt seeing significant rises while nickel remained stagnant, and precious metals generally saw considerable gains. Scarcity and value preservation outweigh demand-driven factors; this logic has run throughout the year. This year's non-ferrous bull market is still a gold and silver bull market. For lithium mines, which are rapidly being applied with high demand growth, this year's price increase is not particularly high, similar to gold at around 60%. The ease of gold's rise is primarily due to its limited industrial use, which does not affect real costs. Aluminum is also in short supply, but its extensive downstream applications mean that even a slight price increase has a significant impact on the manufacturing sector. The more precious metals rise, the more investment value they hold. Today, copper and silver have opened up demand space due to AI, with copper's new demand being marginally higher. Silver still struggles to be widely applied in industry, but its price has consistently outperformed copper, primarily due to its stronger precious metal attributes. However, since the end of the year, there have been some changes in the market, with silver and copper, two precious metals, experiencing short-term gains that outpaced gold for the first time. The rise in lithium prices is fundamentally driven by demand rather than value preservation. The former two are applications in AI computing centers, while the latter is driven by the development of electric vehicles and energy storage. Although the non-ferrous market led by gold has been fierce, over the past six months, one can also observe the volatility at high levels. Scarcity, rather than supply and demand, has made quantitative analysis extremely difficult. The reasons for the rise are simply that they are rising; only when gold prices continue to rise does value preservation become valid. However, once it is clear that certain metals are driven by supply-demand imbalances, calculations can be established accordingly But new problems have arisen. Currently, the analysis of any non-ferrous metals shows that supply and demand are balanced, but everyone's price expectations are varied. For example, investors in lithium stocks generally expect lithium carbonate prices to double to 200,000, while industry insiders predict a stable price around 100,000 next year. Different expectations could lead to performance forecasts for 2026 either doubling or plummeting. Similarly, for the current industry leaders in gold and copper, Zijin Mining, many investors have already projected profits of 100 billion for 2026, while brokerage firms' expectations are still around 60 billion. This 40 billion difference is enough to determine fluctuations in market capitalization in the range of hundreds of billions or even trillions next year. Moreover, even metals that have seen lower price increases this year, where supply and demand analysis is less reliable, have expectations for price corrections. Currently, the price of silver has significantly outpaced that of gold, causing the gold-silver ratio to return from the 80-100 range of recent years to around 60, which is a reasonable range. Although historically, there is no inevitability for the gold-silver ratio to revert, it has maintained a position above the historical average for many years. However, based on the recent surge in silver prices, their reversion seems to have some persuasive power. Interestingly, there are many price ratio formulas similar to the gold-silver ratio, such as the silver-oil ratio, gold-platinum ratio, aluminum-copper ratio, and nickel-cobalt ratio. Some metals have similar properties and exist in complementary and substitutive relationships in industry. If one can rise, why can't the other, especially those with lagging prices, which have greater room for recovery? Thus, supply and demand relationships and various price ratio factors are at play, leading to high expectations in the current non-ferrous sector. The certainty of price increases is high, but there is significant uncertainty about how high the prices will go. Based on the highest and conservative expectations, one sees completely different targets. Many small metal logics are not rigorous, but once various ratios take effect, they seem to act like a bullish option that can surge. II. Low Expectations, Stable Returns In this year's non-ferrous bull market, many futures and stocks have surged together, but there are also some classic counterexamples. The performance of stocks is difficult to equate with futures prices, as capacity deployment, cost control, and policies all affect the profit release of companies. For example, cobalt has surged this year among small metals. It saw a spike in the first half of the year, followed by continued tightening of policies in the Congo, leading to another surge by the end of the year. However, several companies with "cobalt" in their names have only performed moderately within the non-ferrous sector. The 100% increase in cobalt prices in the first half of the year was not fully reflected in the companies' revenues. The core issue is that the price surge was due to the Congo's export quotas, which were significantly reduced, cutting global cobalt supply by nearly half for 2024. As a result, these companies' mines in the Congo were heavily impacted; while prices rose, the volume sharply decreased, leading to minimal revenue growth Due to the low cobalt prices before the New Year, many cobalt companies are operating at a loss, so the profit improvement brought by the doubling in the first half of the year is not significant. Among them, the leading company Huayou Cobalt's performance growth is driven by the production capacity of nickel. Nickel is at the bottom of the metal price increase rankings this year and is also at a historical low price range. However, Huayou's nickel cost is still lower than the current price, and the large new production capacity has not led to further declines in commodity prices, so almost all the new profits have gone to Huayou, thus achieving performance release through this non-increasing price metal. On the other hand, looking at an opposite example, aluminum, which cannot be considered a non-ferrous metal, has not seen a significant increase this year but has contributed to representative bull stocks like China Hongqiao, which has a large market capitalization and high growth. The increase reached 197% within 2025, and the tight supply and demand of aluminum and stable price increases are not the key factors. The performance cannot explain the price increase. The key is that the market was already prepared for a cyclical decline at the end of last year. China Hongqiao reached nearly 4 times PE and a 15% dividend yield, which is significantly lower than its A-share aluminum peers due to the pessimistic habits of the Hong Kong stock market. However, aluminum prices are expected to rise instead of fall in 2025. The logic for aluminum is based on the non-ferrous bull market and the aluminum-copper ratio, so the valuations of aluminum companies are generally aligning towards 15 times PE. As a result, with the Davis double effect, the stock price has doubled. This cyclical decline expectation also exists for oil stocks, but oil stocks have actually decreased in price, while aluminum has risen instead of falling, leading to a significant performance difference. Therefore, expectations are more important than price increases, and not raising prices does not mean there are no earnings. 1. How are the expectations for each company? For these cyclical stock industries, there are similar cyclical stocks corresponding to different market capitalization ranges. For example, CNOOC and PetroChina correspond to profits of over 100 billion, while China Shenhua with a market capitalization of 800 billion corresponds to profits of over 50 billion. If some companies reach the profit levels of the aforementioned companies, it will be difficult for their market capitalization to break free from the influence of these benchmarks. First, looking at the largest weight in the non-ferrous sector, gold, there is a significant divergence in price estimates, with predictions ranging from a slight drop to 3000 or a surge to 6000, and everyone is prepared. However, based on the current price of around 4000, most companies currently have a PE of around 15 times. This PE is not low in the cyclical sector. The reason for the high PE is certainly the optimistic expectations for next year, with profits yet to peak. However, based on the most optimistic expectation of $6,000, the current price corresponds to a PE of 5-10 times, which seems acceptable even if it doesn't rise. The optimistic view is naturally that gold prices can reach $6,000 by 2026, and performance continues to increase significantly, then the PE should be raised to over 15 times, making 5-10 times PE too low, and it should rise at least 1 time. However, most cyclical stocks tend to have lower PEs as performance increases. The reason why gold stocks are generally seeing PE increases for 2025 is due to the price increase expectations for 2026, rather than a PEG logic similar to growth stocks. Therefore, similarly, whether gold stocks in 2026 should be given a PE of 15 times does not depend on how much performance grows, but rather on the expectations for 2027. For example, if gold reaches $10,000 in 2027, that would be reasonable, but the likelihood of this scenario is naturally very low. Overall, the potential increase in gold prices under relatively optimistic conditions may not be high, as even in the most optimistic scenario, it is quite reasonable if prices do not rise. Energy Metals: Energy metals are also receiving considerable attention, mainly lithium, cobalt, and nickel. Lithium is experiencing both volume and price increases, with significant expectations, while cobalt is limited by quotas and can only rely on continuous price increases to drive revenue growth. However, there is a continuous trend of lithium iron phosphate replacing ternary batteries, leading to a decline in cobalt usage. Therefore, in terms of price increase logic, lithium is clearly stronger. Lithium mining stocks are currently similar to cobalt's earlier situation, having declined too deeply. After a significant rise, the industry as a whole is still in a marginal profit state, and the increase is not large enough; a further significant rise from the current price is needed for profit to explode. By the end of the year, this wave could reach 110,000-120,000, basically allowing the entire industry to achieve profitability. Most leading lithium mining companies have costs around 60,000-70,000 per ton, so the industry's current profits are already in a decent state, basically reaching a level of around 400 million profit for every 10,000 tons of capacity. However, relative to the current valuation, this profit is still not enough. Most companies, at best, still have a PE of 20-30 times, which is the biggest uncertainty. What if it drops in 2026? Most investors previously calculated based on 150,000 tons or more, and now it is backfiring. We also need to consider new capacity. Similar to how Huayou Cobalt is pushing profitability through new nickel capacity, many companies will be putting a significant amount of lithium mining capacity into production in 2026. If lithium prices maintain the current level or continue to rise significantly, they will generate substantial profit explosion potential. Including listed companies like CATL, Zijin Mining, Zhongkuang Resources, Qinghai Yanhu Industry, and Ganfeng Lithium, the capacity increments are quite high, while Ganfeng Lithium, as the current capacity leader, faces the issue of insufficient marginal increments. Therefore, if lithium prices do not rise in 2026 and remain stable at high levels, some companies can still release performance, and it can be expected that there will continue to be supply-demand imbalances in 2027, with upward momentum, similar to the rise of gold that can be replicated in 2026. Whether it is the logic of a surge to 200,000+ or the stability logic of 120,000, lithium stocks have certain investability, making them a key focus in non-ferrous metals for 2026. However, the market's calculations regarding the volume logic are still insufficient, but the market has already made its choice. Based on expected incremental calculations, the elasticity is relatively large, meaning that the currently lowest PE stock, Zhongkuang, will be the first to reach new highs. Silver: Currently, the rise in silver is also rapid, greatly threatening to replace gold as the leading non-ferrous metal. Based on the latest prices, most silver stocks are expected to perform better than gold stocks in 2026, with a price-to-earnings ratio of about 10 times. However, there are two unfavorable factors: after a surge, it is prone to a sharp decline, and secondly, the gold-silver ratio has already been corrected. The performance of silver stocks is primarily constrained by gold stocks and the comparative benefits. The gold-silver ratio cannot be expected to move towards the extreme of 30 seen in 2011; it is unrealistic to assume that silver will double its increase compared to gold next year. That said, if the current gold-silver ratio stabilizes and does not rise further, under the current valuation conditions, silver is definitely a better choice than gold, although the extent of this advantage is limited. Copper and Aluminum: The logic of copper and aluminum can be grouped together, as both are heavily used industrial metals. There is also a copper-aluminum ratio in industry. Copper stocks are currently the strongest non-ferrous stocks, primarily due to the broad downstream applications, with copper prices reaching historical highs, driven mainly by AI demand narratives. In terms of demand, copper is stronger than aluminum, while supply constraints are higher for aluminum. The profits for 2025 are estimated to be about 15 times for copper and around 10 times for aluminum. However, based on the price increases over the past month, the actual rolling PE gap is not as significant. Additionally, in terms of price fluctuations, copper has risen by 30% this year, while aluminum has risen by 10%. If this trend of excessive increases continues next year, with copper rising another 20%, the valuation differences will narrow, and copper may even become cheaper, although the copper-aluminum ratio remains within a reasonable range In addition, among aluminum stocks, this year has generally seen a valuation pullback, with the increase in share prices driven by a full valuation recovery. The high dividend yields that were feared to drop at high levels have completely disappeared, but the growth rate of performance is not high, so next year is still expected to have low growth, and the possibility of further valuation pullback is less than that of valuation cuts. Therefore, one should not get entangled in the valuation cost-effectiveness of aluminum relative to copper; instead, even a slight price increase can bridge the gap. Thus, in the category of major metals, the logic of copper is stronger. For other minor metals, there is also some momentum in price increases, but most listed companies do not have very pure businesses, and the current revenue share is still dominated by the aforementioned common metals. So even with significant increases, the contribution to performance is not obvious; the current rise in many non-ferrous stocks is mostly based on expectations of copper. The strategy for minor metals is still to look at both ends: the lagging and the ones with the most significant increases. One is nickel, which is currently the lowest-priced metal. The ratio of lithium-nickel and cobalt-nickel is already at historical extremes. In the development of solid-state batteries, while the usage of cobalt may decrease, nickel remains essential, so long-term demand is actually quite good. Historically, large fluctuations in nickel prices are also common. The low expectations for nickel combined with its low price provide a current bottom advantage, but specific performance remains difficult to quantify. The other is tungsten, which is currently the most robust metal, having doubled in price this year, and there are no similar limitations as with cobalt. This issue relates to tax and China's export policy factors. However, minor metals inherently have greater elasticity, and the impact of price on industry costs is minimal, so they often exhibit extreme behavior, similar to the previous "demon nickel" scenario. However, there are not many companies that actually have mines; smelting instead bears the brunt of price increases. Currently, the industry generally has a PE of around 10 times, which is low compared to the aforementioned stocks. However, this also accounts for the potential for significant corrections after large price increases, so the attractiveness must also consider the logic of cost transfer in the midstream. Conclusion Therefore, combining upward momentum and valuation, silver is stronger than gold, and copper is stronger than aluminum. The valuation differences in the former truly determine returns, while the latter should not be overly concerned with valuation. As for lithium, due to insufficient increases and the timing of new capacity releases not yet arriving, the paper valuation remains high, but digesting the valuation by 2026 is relatively straightforward. Logically superior metals with slight increases naturally exceed expectations, while those lacking sufficient logic have more conditions to meet for exceeding expectations. However, it is clear that none of the above metals can achieve valuation recovery driven by pessimistic reversals like that of China Hongqiao; all must rely on price increases. The expectation of a cyclical decline has been falsified, and currently, only coal and oil meet this criterion. In this situation, one should not forget these two cyclical kings that have dominated for many years ### 相關股票 - [Ganfeng Lithium (002460.CN)](https://longbridge.com/zh-HK/quote/002460.CN.md) - [GANFENGLITHIUM (01772.HK)](https://longbridge.com/zh-HK/quote/01772.HK.md) - [GHNM (600301.CN)](https://longbridge.com/zh-HK/quote/600301.CN.md) - [Qinghai Yanhu Industry (000792.CN)](https://longbridge.com/zh-HK/quote/000792.CN.md) ## 相關資訊與研究 - [Ganfeng Lithium Turns to 2025 Profit](https://longbridge.com/zh-HK/news/281121946.md) - [Lithium Carbonate Industry Chain Should Establish Unified Pricing Mechanism, Tianqi Lithium’s President Says](https://longbridge.com/zh-HK/news/280575897.md) - [Ganfeng Lithium sees surge in battery demand amid China-US energy rivalry](https://longbridge.com/zh-HK/news/281343364.md) - [Ganfeng Lithium Swings Back to Profit on Higher Revenue in 2025](https://longbridge.com/zh-HK/news/281118530.md) - [Ganfeng Lithium Group sees 2025 net profit](https://longbridge.com/zh-HK/news/273831186.md)