Here’s a FTSE 100 share that I think could beat Rolls-Royce in 2026

Gold and silver costs have been hovering increased in latest months. Gold hit document highs over $5,500 per ounce and silver soared previous $100 per ounce for the primary time.

Enter FTSE 100 miner, Fresnillo (LSE:FRES). This mining big digs up gold and silver, primarily in Mexico. Over the previous 12 months, its share value rocketed increased by 430%. That’s insanely good for a FTSE 100 share as the common for the index was round 22%.

Over the previous 5 years, it has even crushed Rolls-Royce shares, which could appear laborious to imagine given that firm’s post-pandemic power.

FTSE 100 prime performer

However can Fresnillo proceed its meteoric rise in 2026?

Properly, that depends upon whether or not demand for gold and silver continues to climb. Rising gold costs have been pushed by central banks snapping up the shiny metallic, a weaker US greenback, and geopolitical tensions.

As for silver, it tends to maneuver much more dramatically than gold. Some even name it ‘gold on steroids’. Like gold, silver can also be seen as a protected haven in occasions of uncertainty. However in distinction, it has robust industrial makes use of too. As an example, it’s used in photo voltaic panels, electrical automobiles, and AI information centres. All of that are anticipated to be high-growth sectors for the approaching years.

Prior to now, when valuable metals have seen explosive rallies, they could grow to be fairly unstable. Costs can swing wildly in each instructions. They could additionally expertise profit-taking in the quick time period.

That stated, many consultants anticipate medium- to long-term tendencies to push costs upward. Many main banking establishments goal over $6,000 for gold and over $150 for silver this 12 months.

As for Fresnillo, its direct tie to commodity supercycles just like the one we could be experiencing now make it a standout for continued outperformance in 2026. It delivered strong 2025 outcomes, however latest downward revisions to 2026 output have launched some warning.

Leveraged play on gold and silver

As a low-cost operator, it stays aggressive and presents revenue margin resilience and robust cash-flow technology. A return on capital employed of over 17% suggests good use of capital. And a ahead price-to-earnings ratio of 30 is in line with historic averages throughout bull cycles. As a bonus, Fresnillo additionally presents a 2% dividend yield.

However bear in thoughts, if costs for valuable metals reverse for an prolonged interval, Fresnillo shares could undergo in the close to time period.

That’s why I would solely personal it as a part of a balanced and diversified portfolio. FTSE 100 shares are sometimes massive, mature, and established corporations that don’t typically witness triple-digit returns.

However every now and then, there are outliers. Prior to now 12 months, there have been six FTSE 100 shares that resulted in returns of over 100%.

Whether or not we’ll see a repeat in 2026 is unknowable, however actually attainable. That stated, after any near-term volatility in valuable metals costs, I think long-term tendencies will proceed to help them. That ought to bode nicely for Fresnillo in 2026.