Platinum Soars to Decade High as Gold Fatigue Sets In – SBSW, BRVO, ELR in Focus

Platinum's bull run just hit a 10-year peak—while gold investors yawn and check their portfolios for the hundredth time this week.

Why the surge? Traders are rotating out of overbought gold into undervalued platinum plays like SBSW, BRVO, and ELR. The 'poor man's gold' is suddenly looking rich.

Wall Street analysts (those same geniuses who missed Bitcoin at $100) are now scrambling to upgrade price targets. Meanwhile, physical demand from automakers and industrial users keeps climbing.

One hedge fund manager quipped: 'Platinum's the new contrarian play—right until everyone piles in and ruins it.'

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Platinum’s price increase has outpaced gold, which has seen its price rise 29% this year to reach an all-time high. Analysts say platinum is benefitting from “gold fatigue” as investors diversify and rotate into other metals and commodities.

Jewelers are also reportedly switching from Gold to platinum due to costs and changing consumer preferences, especially in China. Platinum jewelry demand in China is becoming an increasingly important factor driving the price higher, say analysts.

Supply Deficit

However, a deficit in global supplies for a third consecutive year is the biggest reason that platinum is currently trading at $1,313.10 an ounce and up 44% on the year. Platinum’s price is up nearly 25% in June alone as demand surges. Investors wanting exposure to platinum should consider mining stocks such as Eastern Platinum (TSE:ELR), Bravo Mining (TSE:BRVO), and Sibanye Stillwater (SBSW).

Platinum is a diverse metal and used in catalytic converters, laboratory equipment, electrical contacts and electrodes, platinum resistance thermometers, dentistry equipment, and jewelry. China imported 11.5 metric tons of platinum in April of this year, the highest monthly total in over a year.

Despite this year’s rally, platinum’s price remains below its 2014 all-time high of $1,500 an ounce. Some analysts say that platinum remains undervalued compared to other metals such as gold and silver.

Is SBSW Stock a Buy?

The stock of Sibanye Stillwater has a consensus Moderate Buy rating among two Wall Street analysts. That rating is based on one Buy and one Hold recommendations issued in the last three months. The average SBSW price target of $6.05 implies 13.32% downside risk from current levels.