Investing in palladium stocks

This high-value metal is tricky to source and in high demand — especially from car manufacturers. But with a history of volatility and the electric vehicle market booming, there’s no guarantee it will continue to hold its value.

What is palladium?

Palladium is a bright, silver-white metal primarily mined in Russia and South Africa. It’s typically produced as a byproduct of mining other materials, like nickel and platinum. It is one of the six platinum-group metals, a group that includes iridium, osmium, platinum, rhodium and ruthenium.
We’re most likely to encounter palladium when driving a vehicle, as nearly 85% of mined palladium finds itself in the exhaust systems of cars. It’s a vital component of the catalytic converters responsible for transforming toxic pollutants into carbon dioxide, nitrogen and water vapor. Palladium is also used in dentistry, electronics, medicine and jewelry manufacturing.
Palladium stocks are stocks from companies that produce palladium — mining companies, mostly. Unfortunately, there are few pure-play palladium stocks, as this metal is typically produced as the mining byproduct of other materials, like platinum.

Why invest in palladium stocks?

Palladium is 30 times rarer than gold and as demand for this material continues to rise, so do its prices.
The cost of palladium has been on the rise since 2016, hitting an astonishing high of $2,714 per ounce in February 2020. For comparison, gold was trading at $1,575.95 per ounce at that time.
Why is palladium on the rise? In short: demand. Anytime the demand for a commodity outpaces its supply, the price of that commodity rises. And palladium supplies have been unable to meet global demand since 2012.
And the good news for investors is that the demand for this metal looks like it will continue its upward trajectory. With our heavy reliance on palladium in catalytic converters and rising global pressure to ditch high-emission vehicles, car markers need more palladium than ever. And since the metal isn’t easily replaced, palladium demand is high.
The bottom line? Palladium is valuable, and trends in global demand for this metal are poised to drive its value higher still.

Risks of investing in palladium

Despite palladium’s rising price tag, this commodity hasn’t always been such a hot commodity. In fact, the metal has a history of volatility and is only valuable so long as it’s needed.
While car manufacturers have yet to find a palladium workaround, a replacement isn’t exactly out of the question. And with palladium being so rare and cumbersome to produce, it’s quite possible that an alternative could be found — especially given the failure of palladium miners to meet increasing global demand.
Another threat to consider is the rising popularity of electric vehicles. The electric vehicle market is growing — fast. And this could act as a significant market disruptor for palladium since electric vehicles don’t require catalytic converters.

Palladium stocks

There are few pure-play palladium stocks, as most of the palladium that’s manufactured is produced as a byproduct of other metals. So if you plan to invest in this commodity, prepare to back mining companies that produce other materials too, like platinum. See how the following stocks are performing, and view details like market capitalization, the price-to-earnings (P/E) ratio, price/earnings-to-growth (PEG) ratio and dividend yield.

• Canadian Palladium Resources (BULL.CN)

  Company summary

  Quest Critical Metals Inc., a minerals exploration company, engages in the exploration and evaluation of mineral properties. It has an option agreement to acquire 100% interest in the East Bull Palladium Property that comprise 992 hectares located in the Sudbury mining division, Ontario. The company was formerly known as Canadian Palladium Resources Inc. and changed its name to Quest Critical Metals Inc. in December 2023. Quest Critical Metals Inc. was incorporated in 2005 and is headquartered in Vancouver, Canada.

  Historical performance

  Stock information

  • Market capitalization: $3101987
  • Dividend yield: N/A%

• Eastern Platinum (ELR.TO)

  Company summary

  Eastern Platinum Limited, together with its subsidiaries, engages in the mining, exploration, and development of platinum group metal and chrome properties in South Africa. Its PGM deposits include platinum, palladium, rhodium, osmium, iridium, and ruthenium. The company's flagship project is the the Crocodile River Mine located on the Western Limb of the Bushveld Complex in the north west province of South Africa. Eastern Platinum Limited was founded in 2003 and is headquartered in Vancouver, Canada.

  Historical performance

  Stock information

  • Market capitalization: $40468200
  • P/E ratio: 3.3333
  • PEG ratio: 0
  • Dividend yield: N/A%

• Grid Metals (MSMGF.US)

  Company summary

  Grid Metals Corp. engages in the exploration and development of base and precious metal mineral properties in Canada. It explores for nickel, copper, cobalt, lithium, palladium, and platinum group metals. The company was formerly known as Mustang Minerals Corp. and changed its name to Grid Metals Corp. in June 2018. Grid Metals Corp. is headquartered in Toronto, Canada.

  Historical performance

  Stock information

  • Market capitalization: $6745232
  • Dividend yield: N/A%

• Impala Platinum (IMP.JSE)

  Company summary

  Impala Platinum Holdings Limited engages in the mining, processing, concentrating, refining, and sale of platinum group metals (PGMs) and associated base metals. The company produces platinum, palladium, rhodium, nickel, and by-products, as well as ruthenium, iridium, and gold. It has mining operations on the Bushveld Complex located in South Africa; and the Great Dyke situated in Zimbabwe, as well as the Canadian Shield. The company markets and sells its products in South Africa, Japan, China, the United States, and Europe. Impala Platinum Holdings Limited was incorporated in 1957 and is based in Sandton, South Africa.

  Historical performance

  Stock information

  • Market capitalization: $168024481430
  • Dividend yield: N/A%

• Ivanhoe Mines (IVPAF.US)

  Company summary

  Ivanhoe Mines Ltd. engages in the mining, development, and exploration of minerals and precious metals primarily in Africa. It explores for platinum, palladium, nickel, copper, gold, rhodium, zinc, silver, germanium, and lead deposits. The company's projects include the Platreef project located in the Northern Limb of South Africa's Bushveld Complex; the Kipushi project located in Haut-Katanga Province, Democratic Republic of Congo; and the Kamoa-Kakula project located within the Central African Copperbelt. It also holds a 100% interest in the Western Foreland exploration project covering an area of approximately 2,407 square kilometers located in the Democratic Republic of Congo. The company was formerly known as Ivanplats Limited and changed its name to Ivanhoe Mines Ltd. in August 2013. The company was incorporated in 1993 and is based in Vancouver, Canada.

  Historical performance

  Stock information

  • Market capitalization: $18888159232
  • P/E ratio: 116.3333
  • PEG ratio: 0
  • Dividend yield: N/A%

• New Age Metals (NMTLF.US)

  Company summary

  New Age Metals Inc., a mineral exploration company, engages in the acquisition, exploration, and development of platinum group metals (PGMs), precious, and base metals properties in Canada and the United States. It operates through two divisions, Platinum Group Metals and Lithium/Rare Element. The company explores rhodium, palladium, platinum, gold, nickel, copper, and lithium deposits. Its flagship project includes, River Valley Palladium Project covering an approximate area of 12,000 acres located in the Sudbury, Northern Ontario. The company was incorporated in 1996 and is headquartered in Vancouver, Canada.

  Historical performance

  Stock information

  • Market capitalization: $5628978
  • Dividend yield: N/A%

• Palladium One Mining (PDM.V)

  Company summary

  Palladium One Mining Inc. explores for and develops mineral resource properties. The company primarily explores for palladium, platinum group elements, gold, copper, cobalt, and nickel. Its flagship property comprises a 100% interest in the Lantinen Koillismaa project located in north-central Finland. Palladium One Mining Inc. is headquartered in Toronto, Canada.

  Historical performance

  Stock information

  • Market capitalization: $17967450
  • Dividend yield: N/A%

• Platinum Group Metals (PTM.TO)

  Company summary

  Platinum Group Metals Ltd. engages in the exploration and development of platinum and palladium properties. It explores for palladium, platinum, gold, copper, nickel, and rhodium deposits. The company holds 50.02% interest in the Waterberg project located on the Northern Limb of the Bushveld Igneous Complex, South Africa. It also develops next-generation battery technology using platinum and palladium. Platinum Group Metals Ltd. was founded in 2000 and is headquartered in Vancouver, Canada.

  Historical performance

  Stock information

  • Market capitalization: $281820000
  • PEG ratio: 0
  • Dividend yield: N/A%

• Sibanye Gold Ltd ADR (SBSW.US)

  Company summary

  As of June 19, 2024, Sibanye Stillwater Limited was acquired by UBS Group AG. Sibanye Stillwater Limited, together with its subsidiaries, operates as a precious metals mining company in South Africa, the United States, Europe, and Australia. The company produces gold; platinum group metals (PGMs), including palladium, platinum, rhodium, iridium, and ruthenium; chrome; nickel; and silver, cobalt, and copper. Sibanye Stillwater Limited was founded in 2013 and is headquartered in Weltevreden Park, South Africa.

  Historical performance

  Stock information

  • Market capitalization: $3509904384
  • Dividend yield: N/A%

  Get more detailed information and learn how to buy SBSW.US stock

• Sienna Resources (SIE.V)

  Company summary

  Sienna Resources Inc. engages in the acquisition, exploration, and evaluation of mineral properties in Canada and the United States. It primarily explores for platinum, palladium, and lithium deposits. The company was formerly known as Habanero Resources Inc. and changed its name to Sienna Resources Inc. in January 2014. Sienna Resources Inc. was incorporated in 1983 and is headquartered in Vancouver, Canada.

  Historical performance

  Stock information

  • Market capitalization: $7884519
  • Dividend yield: N/A%

What ETFs track the palladium category?

Of the three ETFs that contain palladium exposure, the Aberdeen Standard Physical Palladium Shares ETF (PALL) is the closest to a pure-play, as it tracks the performance of palladium with over 130,000 ounces stored in a secured JPMorgan Chase & Co vault in London.

• Aberdeen Standard Physical Palladium Shares ETF (PALL)
• Aberdeen Standard Physical Precious Metals Basket Shares ETF (GLTR)
• Sprott Physical Platinum and Palladium Trust (SPPP)

Palladium performance

This graph shows the spot price per ounce of palladium.

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Bottom line

Palladium plays an important role in the automotive industry as a key component of catalytic converters. But its value could be at risk if a substitute metal were found to take its place.
Before you purchase palladium, review your trading platform options to find the brokerage account that can help you meet your investment goals.

Frequently asked questions

• Do palladium stocks pay dividends?

  Yes. Some that do include North American Palladium and Sibanye Gold.

• Can I purchase penny stocks in the palladium industry?

  Yes. Some penny stocks in the palladium industry include Canadian Palladium Resources, Eastern Platinum Limited and Sienna Resources.

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