Tonight, in continuing with the top five stocks to own in the top five sectors to own during a recession I will visit the industrial metal and mineral stocks. These kind of companies are sometimes seen as a hedge to the economy, especially when the dollar is being driven so much lower as it has of late. Metal and mineral stocks generally capitalize in periods of a weak dollar. This is a broad-based industry, with some of the companies faring a lot better through recessions than others. 
Top 5 Metal and Mineral Stocks to own through recessions
- Freeport McMoran (NYSE:FCX) This company is growing like weeds right now. The past five years it has grown its sales by an average of 60% a year. Right now the PEG ratio of FCX is a measly 0.32. Though the stock has done extremely well already, it seems that the market is still undervaluing the growth prospects of this company.
- Barrick Gold (NYSE:ABX) Barrick is a terrific hedge inside a portfolio for when recession is looming. This is not a high-growth stock, but a steady and solid performer. Since there is usually a flight to quality in gold when recessions occur, sticking with the biggest and most consistent name in the gold industry makes a lot of sense to me.
- Potash (NYSE:POT) This company is a little different than the first two. The company is involved in nonmetallic mineral mining and its number one product is fertilizer. While there is certainly a chance that this type of business could experience some bumps during a recession, the overall growth in the area should lead this stock out of a recession faster than the overall market. The growth rate here is tremendous.
- BHP Billiton (NYSE:BHP) BHP is a metal and minerals giant that deals in many different areas. The company is easily the most diversified in this sector, which makes it a safer investment than most in this area. They have a market leading position in aluminum, nickel, iron ore, diamonds, and many other areas. The balance sheet here supports possible acquisitions in the future and the business model is a very good one.
- Silver Wheaton (NYSE:SLW) Silver Wheaton is a leader in the much underappreciated silver industry. This company isn't known to a lot of investors, but it is growing very nicely and its margins are very impressive. This is a good way to try to steady the portfolio while staying under the radar.
As I said in the introduction to this post, the metals and mineral stock area is a little more tricky than the first three sectors I touched on, mainly in that some of the stocks in this industry are very cyclical. You have to be more picky in this industry, but when you fight the right ones, they can do you a lot of good through an economic recession.
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