Antofagasta (70GD) AI Stock Analysis

• Market Cap: £21.69B
• Dividend Yield: 709.22%
• Average Volume (3M): 0.00
• Price to Earnings (P/E): ―
• Beta (1Y): 0.06
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: UK
• Employees: 8,095
• Sector: Basic Materials
• Sector Strength: 60
• Industry: Copper
• EPS (TTM): N/A
• Shares Outstanding: N/A
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 0
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £77.00
• Price Target Upside: 9.22% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 68 Neutral
• Price Target: 77.00p ▲(9.22% Upside)

Antofagasta's strong financial performance and positive earnings call are the most significant factors, reflecting robust revenue and EBITDA growth. However, technical analysis indicates potential overbought conditions, and valuation concerns arise from the high dividend yield and lack of P/E ratio data. Effective management of capital expenditures and operational challenges will be crucial for future performance.

Positive Factors

Revenue Growth

The significant increase in revenue and EBITDA demonstrates strong operational performance and effective cost management, indicating a robust market position and potential for sustained growth.

Project Expansion

The ongoing expansion projects are expected to boost production by 30%, enhancing capacity and long-term revenue potential, which strengthens the company's competitive position in the mining industry.

Technological Advancements

Advancements in Cuprochlor technology could lead to improved extraction efficiency and cost savings, providing a competitive edge and supporting sustainable operations over the long term.

Negative Factors

High Capital Expenditures

High capital expenditures are straining free cash flow, which could limit financial flexibility and pose liquidity challenges if not managed effectively, impacting long-term financial stability.

Water Solution Challenges

The need for a new water solution at Zaldívar presents operational risks and potential cost implications, which could affect production efficiency and profitability if not resolved timely.

Moderate Debt Levels

Moderate debt levels could pose risks in volatile market conditions, potentially impacting the company's ability to invest in growth opportunities and maintain financial stability.

Antofagasta Business Overview & Revenue Model

Company Description

Antofagasta PLC is a Chilean copper mining company. The company operates four copper mines in Chile, two of which produce significant volumes of by-products. The company also has a portfolio of growth opportunities located mainly in Chile. In addition to mining, the company has a transport division providing rail and road cargo services in northern Chile to mining customers. All of the company's operations are located in the Antofagasta Region of northern Chile except for its flagship operation, Los Pelambres, which is in the Coquimbo Region of central Chile. The operating business segments are Los Pelambres, Centinela, Antucoya, Zaldivar, Exploration and evaluation, Corporate and other items, and Transport division. The Los Pelambres segment drives maximum revenue.

How the Company Makes Money

Antofagasta generates revenue primarily through the extraction and sale of copper, which is sold to customers worldwide, including major industrial companies and manufacturers. The company operates a vertically integrated model that includes mining, refining, and processing, allowing it to maximize efficiency and control costs. Key revenue streams include the sale of copper concentrate, molybdenum, and by-products from its mining operations. Additionally, Antofagasta benefits from long-term contracts with customers and fluctuating market prices for metals, which can significantly impact earnings. The company also engages in partnerships and joint ventures that enhance its operational capabilities and expand its market reach, further contributing to its financial performance.

Antofagasta Financial Statement Overview

Summary

Antofagasta shows strong operating margins and a stable balance sheet, with steady revenue growth. However, profitability margins have room for improvement, and high capital expenditures present challenges in free cash flow management.

Income Statement

Antofagasta's income statement shows a strong gross profit margin of approximately 37.9% for 2024, reflecting efficient cost management. However, the net profit margin is moderate at 12.5%, indicating room for improvement in profitability. Revenue growth from 2023 to 2024 is 4.6%, demonstrating steady growth, though slower compared to previous years. EBIT and EBITDA margins are robust at 30.4% and 60.0% respectively, highlighting significant operating efficiency.

Balance Sheet

The balance sheet of Antofagasta reveals a debt-to-equity ratio of 0.57, showing a moderate level of leverage. Return on equity (ROE) is 8.8%, indicating moderate profitability for shareholders. The equity ratio stands at 41.8%, suggesting a stable financial structure with a good proportion of assets financed by equity. However, there is a moderate level of debt that presents potential risk in fluctuating market conditions.

Cash Flow

Antofagasta's cash flow statement indicates negative free cash flow for 2024, reflecting significant capital expenditures, which could be a concern. The operating cash flow to net income ratio is strong, signifying good cash conversion efficiency. However, the free cash flow to net income ratio is negative due to high capital expenditures, suggesting potential liquidity challenges if not managed carefully.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.32B	6.61B	6.32B	5.86B	7.47B	5.13B
Gross Profit	2.66B	2.50B	2.66B	2.43B	4.17B	2.27B
EBITDA	2.89B	3.97B	3.30B	2.85B	4.63B	2.56B
Net Income	835.10M	829.40M	835.10M	1.53B	2.23B	886.60M
Balance Sheet
Total Assets	19.65B	22.63B	19.65B	18.24B	17.28B	16.60B
Cash, Cash Equivalents and Short-Term Investments	3.38B	4.32B	3.38B	2.39B	3.71B	3.67B
Total Debt	4.08B	5.35B	4.08B	3.27B	3.17B	3.75B
Total Liabilities	7.60B	9.68B	7.60B	6.59B	6.25B	6.52B
Stockholders Equity	8.95B	9.46B	8.95B	8.63B	8.35B	7.75B
Cash Flow
Free Cash Flow	203.80M	-129.30M	203.80M	-2.30M	1.89B	751.30M
Operating Cash Flow	2.33B	2.29B	2.33B	1.88B	3.67B	2.06B
Investing Cash Flow	-2.09B	-2.08B	-2.09B	-477.50M	-2.20B	-2.19B
Financing Cash Flow	-402.00M	1.35B	-402.00M	-1.33B	-1.95B	717.10M

Antofagasta Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
70GD	68 Neutral	£21.69B	―		709.22%	―	―
Sector *	61 Neutral	$10.42B	7.39	-0.05%	2.86%	2.86%	-36.73%
AAUKF	―	$37.38B	―	-9.21%	0.85%	―	―
FNLPF	―	$21.94B	48.92	11.97%	5.17%	―	―
ATYM	76 Outperform	£755.88M	12.02	13.54%	0.71%	21.25%	108.30%
CAML	74 Outperform	£250.69M	8.93	9.97%	8.18%	5.70%	-9.60%
GLEN	64 Neutral	£35.35B	―	-5.26%	2.46%	-1.06%	-285.88%