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- Lundin has started the production at its Eagle mine and expects first sales in October.
- The start-up was expected, but it’s a nice surprise to see the construction being completed ahead of schedule.
- The investment thesis already took a successful start-up into consideration, but an acquisition could change my valuation.
- Lundin Mining is a diversified mining company focused on copper, nickel, zinc and lead.
- The Eagle Mine will start production next quarter and it will be the first U.S. primary nickel producing mine.
- The Eagle Mine is a high grade nickel-copper deposit with cash costs (net of copper byproducts) of $2/lb of nickel.
- The Eagle Mine alone should add several tens of percent to the share price.
- Nickel prices above $10/lb can easily double the current share price.
- Lundin Mining has announced updated resources and reserves for all its majority-owned mines.
- At all mines the mining depletion was compensated by new resources and at several mines the total resource after depletion actually increased.
- The investment thesis remains standing, as Lundin Mining will perform well at the current commodity prices.
- Lundin Mining has a very diversified asset base, focused on copper, zinc and nickel.
- As the Eagle Nickel mine will be in production by the end of this year, Lundin's capex requirements will drop from next year on.
- Lundin will need to acquire new projects to fill its pipeline, and I expect the company to become active on the M&A front later this year.
- Lundin Mining seems to be fully valued, but its robust balance sheet and huge free cash flow from next year could be very important for further share price developments.