Q: YTD Lundin's stock price has significantly out performed Capstone. Are there fundamental reasons for that and what are your expectations going forward?
5i Research Answer:
LUN recently reported consolidated copper cash-costs of US $1.61/lb, among the lowest in its peer group. It raised full-year copper production guidance, and its balance sheet saw some improvement this year.
CS is also expecting strong growth, but its cash cost is higher (roughly US $2.20 to $2.50/lb for 2025). But, CS is expecting to grow at a faster pace than LUN.
We like both names, but for a higher growth tilt we think CS has stronger growth potential (it exhibited outperformance throughout 2020 to 2023). Although, we like LUN's recent momentum and it is operationally efficient.