It was inevitable. Concern over the potential for a massive trade war, especially with China, has dented some of the top stocks in the sectors that do some of the most business with China. Whether it is iron ore, copper, coal or other commodities, China has a massive hunger and need for them, which seemingly grows every year.

In a new research report, Jefferies remains bullish on the mining and commodities sector, citing as one of the biggest reasons the lack of supply growth. They also think they trade wars fears, while justified, may be overblown.

The Jefferies report said this:

The miners have under-performed recently due to renewed fears of a trade war between China and the US. China accounts for about half of global demand for mined commodities, on average. Slower Chinese growth due to adverse trade policies would be a clear negative for the sector, but the recent correction in mining shares is overdone, based on our analysis.

We screened the Jefferies mining and commodities universe for stocks rated Buy that trade here in the United States. We found four that look like outstanding trades now.

Alcoa

This company could be a solid play for more conservative accounts looking to the sector. Alcoa Corp. (NYSE: AA) produces and sells bauxite, alumina and aluminum products. The company offers aluminum sheets for the production of cans for beverage and food.

Alcoa also engages in the aluminum smelting, casting and rolling businesses; generation and sale of renewable energy; as well as provision of ancillary services. The company was formerly known as Alcoa Upstream and changed its name to Alcoa in October 2016.

The Jefferies price target for the shares is $65, while the Wall Street consensus price target is slightly higher at $66. The shares closed Thursday at $44.81.

Barrick Gold

This is one of the top companies in the gold-mining sector and its stock sold off recently, providing a solid entry point. Barrick Gold Corp. (NYSE: ABX) produced 5.32 million ounces of gold in 2017, making it the world’s largest gold producer. At year-end 2017, Barrick’s reserve position totaled 64 million ounces, one of the largest in the world. The company is in the midst of building three new development project, which will add nearly 1 million ounces of new output by 2023.

The company has worked hard over the past few years to deleverage the balance sheet, and asset optimizations and digitization have been implemented to lower costs. Through its large reserve base, a slew of development assets and no hedging, the company offers investors a big exposure to gold.

Investors are paid just a 0.95% dividend. Jefferies has a $17 price target, and the consensus target is $15.67. The shares closed Thursday at $12.85.

Freeport-McMoRan

This one may be a compelling value at current trading levels, and it is one of the top picks at Jefferies in the sector. Freeport-McMoRan Inc. (NYSE: FCX) is the world’s largest publicly traded copper and molybdenum producer, and the eighth largest gold producer. Its key operating and development assets are in Indonesia, North and South America, and Africa.

Highly leveraged toward copper mining, the company could be a big player in a scenario of rebuilding and repairing old and battered projects and would clearly benefit from stronger demand and higher prices for industrial commodities.

The $26 Jefferies price target compares with the consensus target of $19.18. Shares closed Thursday at $16.36.

Peabody Energy

This is the top coal pick at Jefferies and one of the best run companies in the industry. Peabody Energy Inc. (NYSE: BTU) is engaged in the mining of thermal coal for sale primarily to electric utilities and metallurgical coal for sale to industrial customers. Its mining operations are located in the United States and Australia.

Peabody’s segments are Powder River Basin Mining, Midwestern U.S. Mining, Western U.S. Mining, Australian Metallurgical Mining, Australian Thermal Mining, Trading and Brokerage, and Corporate and Other.

The company also markets and brokers coal from other coal producers, both as principal and agent, and trades coal and freight-related contracts through trading and business offices in Australia, China, Germany, India, Indonesia, the United Kingdom and the United States.

Shareholders are paid a 1% dividend. The Jefferies price target is $55. The posted consensus target is $50.13, and the stock closed Thursday at $45.67.

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These four top mining and commodities companies are in four different arenas for the most part. They all make good sense for growth portfolios looking to add mining exposure at a time when trade concerns may be weighing on the stock prices.

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