Lundin Gold: Solid Execution and Long-Term Upside, But Fully Valued Near-Term Justifying a Hold Rating

In a report released today, Brian Quast from BMO Capital maintained a Hold rating on Lundin Gold, with a price target of C$125.00.

Brian Quast has given his Hold rating due to a combination of factors tied to Lundin Gold’s solid but largely fully valued operating profile. Q4/25 gold production closely matched his expectations and the company delivered strong annual output within its guidance range, underscoring consistent execution at Fruta del Norte. He also sees a positive earnings tailwind from higher realized gold prices in Q4/25, which should support near‑term profitability and free cash flow generation. However, operating metrics such as throughput and metallurgical recoveries are still tracking slightly below internal targets, reflecting room for improvement rather than clear outperformance.

Brian Quast’s rating is based on the view that while there is meaningful long‑term potential, key value catalysts remain several years away and are not without uncertainty. He highlights that investors are likely to focus on the upcoming development decision for the FDNS project and the mine‑to‑mill expansion study, both expected in 2026, which could unlock further production growth but are still in the decision phase. In addition, new porphyry exploration targets could diversify revenue through copper exposure, yet these discoveries would require substantial time and capital to translate into cash flow. Balancing the company’s strong track record and optimization upside against current cost pressures and the long lead time on major growth projects, he concludes the risk‑reward profile justifies a Hold (Market Perform) stance rather than a more aggressive rating at this stage.