The Outlook
Like gold, the price of silver has surged following Britain's vote to leave the European Union, with investors purchasing the "safe haven" metals to protect wealth in the event other markets falter. According to an article published on July 19 on INN Daily, the silver price has gone up more than 43% year-to-date, "leap-frogging ahead of gold post-Brexit."

Frank Holmes of U.S. Global Investors, in a July 11 post, notes that silver tops his "Periodic Table of Commodity Returns" for the first half of 2016. "Silver demand had a phenomenal 2015, with retail investment and jewelry fabrication both reaching all-time highs," Holmes wrote. Add to that an increase in demand for silver for photovoltaics, and now Brexit, and the first half of the year has "has been highly constructive. . ." Holmes notes that some experts believe the silver price will reach between $25 and $32 per ounce by year-end. The metal currently trades for ~$19.90/ounce.

Though optimism is prevalent, investors can expect some volatility. Because silver is both "currency and commodity," used in a variety of industrial and other uses, its value is "more highly correlated with stocks" than the value of gold, INN Daily reports.

The potential for volatility is also reflected in the comments of technical analyst Clive Maund, who declared the silver bull market underway in a Gold Report article on July 11. While his optimism was clear, Maund did note that a correction could come into play. "If you are a long-term investor, you may simply decide to ride out any correction," the analyst wrote. But short-term investors might want to "take some money off the table here if [they] are long the sector, taking advantage of the comparatively high prices now prevailing."

The Companies
A number of companies are positioned to benefit as the silver bull continues. As expert David Kranzler explains in the Mining Stock Journal, ". . .mining stocks are a 'derivative' of gold/silver, meaning their intrinsic value as companies is derived from the price of gold/silver. They are leveraged plays on the price of the metals."

As such, any silver company is positioned to benefit from a rise in silver price. Kranzler's case-in-point is Southern Silver Exploration Corp. (SSVFF), which he believes is "significantly undervalued relative to the size of its silver reserve. It will be a big winner." Southern Silver Exploration is a Canada-based explorer with two major projects, one in New Mexico and the other in the Mexican state of Durango.

Southern Silver has also captured the attention of Vicarage Capital, which noted in a June report that the company has "an experienced board of directors and strong management team with a good track record in project exploration, discovery and development."

In the wake of Great Panther Silver Ltd.'s (GPL) Q2/16 production results, Heiko Ihle of Rodman & Renshaw released a report that outlined the reasons behind a target price increase to $2.25/share, among them a "fully stocked" treasury following a recent bought-deal equity financing, stable production at San Ignacio and the company's focus on maintaining "low operating costs across its existing asset base while continuing to evaluate strategic external growth opportunities." Ihle noted that Rodman & Renshaw has not increased its "silver price deck from $17.50. . .any such changes should benefit companies with meaningful silver production such as Great Panther."

Raymond James resumed coverage of MAG Silver Corp. (MVG) as of July 11. "We view the Juanicipio project (MAG: 44%) as, without doubt, the best undeveloped silver asset globally. Our thesis for MAG is reinforced, quite simply, by the exploration upside offered at Juanicipio and elsewhere (Cinco de Mayo) and a lack of broader high-quality silver-focused investible opportunities," analyst Chris Thompson noted in the report. "We see MAG trading at a developer discount to producers, and [primed] to rerate catalyzed by development progress and/or exploration success.” Raymond James also included MAG on its list of preferred silver equities in its July 21 Q2/16 Precious Metals Preview.

Raymond James also covers Endeavour Silver Corp. (EXK); a July 11 report by analyst Chris Thompson noted that Endeavour Silver delivered better-than-expected production results for Q2/16, surpassing Raymond James' estimates by 13%. The stronger metal price environment is changing investment decisions, leading to increased capital spending. "Capital spending across EDR's producing assets is budgeted to increase to $17.4 mln (from $11.3 mln) with a focus on development access to new ore sources," noted Thompson, adding, "At Guanacevi, EDR has made a production decision to develop a new mine at the Santa Cruz Sur orebody for total capital budget of $8.4 mln over 3 years."

The stronger price environment also led Endeavour Silver to reverse a planned production reduction. "Given the improved metal price environment, management has elected to sustain production levels at 1,500 tpd and no longer ramp down to care and maintenance [at El Cubo] by year-end," Thompson commented.

Another company positioned to benefit from an uptick in silver price is Golden Arrow Resources Corp. (GARWF), which recently released an updated resource estimate for its Chinchillas project in Argentina. "The updated resource estimate now also contains a maiden measured resource estimate of 17 million silver-equivalent ounces, bringing the total M&I resources to 155 million [silver-equivalent ounces]," expert Thibaut Lepouttre noted in Caesars Report in June. Lepouttre expects Chinchillas may contain "half a billion silver-equivalent ounces."

Silver Wheaton Corp. (SLW) is also levered to the silver price. In Raymond James' July 21 Q2/16 Precious Metals Preview report, the firm named Silver Wheaton a top pick both as a silver equity and a streamer. Credit Suisse upgraded Silver Wheaton at the end of June from Neutral to Outperform. Analyst Ralph Profit noted, "While CRA tax risk likely continues as an overhang, SLW's business model still provides investors with a highly levered play on precious metals prices and SLW should still command a multiple in-line with royalty valuations and a premium to precious metals miners based on its leverage to underlying prices, free cash flow, and strong balance sheet."